Taxpayer cash used for failed arena bid (From Croydon Guardian)

Taxpayer cash used for failed arena bid

8:59am Wednesday 20th August 2008

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Croydon Council used taxpayer’s money to foot a £168,000 bill to help Arrowcroft’s failed arena bid.

The council reached an agreement with Arrowcroft in May 2006 that it would cover the costs of a compulsory purchase order for the Croydon Gateway site and then claim the money back from the company at a later date.

A Croydon Guardian investigation can reveal that the council has issued Arrowcroft with six invoices from September 2007 to July 2008, totalling £168,727.30 in legal fees and advice from its own chartered surveyors. More than £14,000 remains unpaid.

Following our inquiry, Arrowcroft repaid an invoice for £63,000.

Under the agreement, Arrowcroft promised to pay the council “all CPO costs incurred by the Council. . . within 20 working days of receiving a fully itemised invoice”.

Despite this, Arrowcroft took 305 and 171 days respectively to pay two of the bills.

Croydon Council does not appear to have charged the company any interest for the late payments.

Anti-arena campaigner Ken Frost said: “As a qualified chartered accountant I can see a few problems with this. It indicates that the council does not have effective control over taxpayer’s assets.

“If they have not charged interest, the question is why not? It is our money that they are wasting here.

“This is not a huge amount of money. If they cannot afford to pay it back, how would they have financed an arena development?”

Mr Frost said Albert Dock Ltd, an Arrowcroft development in Liverpool shows losses in excess of £1m and debts of £24m in the company accounts.

“As a taxpayer, I am disgusted that the council has wasted my money. I want to see that they have charged interest.”

Tony Newman, Labour leader said: “This is the taxpayers money, not the council’s and Arrowcroft’s. If an agreement was entered into and money is now owed then it should be paid back with immediate effect.”

A spokeswoman for Arrowcroft said: “I can unequivocally confirm that the financial position of the Arrowcroft Group of companies is strong and healthy.

“The outstanding invoice represents a very small percentage of the overall cost of Arrowcroft's support for the council's CPO, most of which has already been met.

“It is normal in business for invoices to be queried and backed up by appropriate paperwork and in the case of this particular invoice there are some minor discrepancies which need to be cleared up, so that the invoice can be settled.”

A spokeswoman for the council said: “These invoices relate to fees that cover third party costs and it is for this reason that negotiations are continuing with Arrowcroft.

“However, both parties are in agreement that all CPO costs will be reimbursed and we are therefore confident that payment will be made.

“In line with other local authorities, the council does not charge interest on sundry debtors.”

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