Council releases explanation of costs for Lyme Green fiasco

Cheshire East Council has released figures to show that the net cost of the cancelled Lyme Green Waste Transfer Station project in Macclesfield is £262,000.

The Council says a full review has been carried out, factoring in all potential and actual costs and savings. The figures released show a comparison between the actual costs of aborting the project and the estimated costs had the scheme progressed as initially planned.

Costs include £595,000 paid to the main contractor and £106,000 in professional fees. Offset against this £701,000 is £246,000 which is made up of £145,000 as the building is being retained for an alternative use, £18,000 which is the cost of surveys to be offset against future disposal and £292,000 which is the cost of site clearance and preparation which is also offset against future disposal.

Added to the £246,000 is £2,036,000 in costs for providing the service from November 2011 to March 2015 ( £1,1882,000 in payments to the third party contractor and £154,000 additional costs) and £365,000 investigation costs (£225,000 for the DIP review and £140,000 for severance payments).

This brings the total costs for the aborted scheme to £2,647,000.

Cheshire East Council has then deducted the costs had the scheme been completed which are £1,500,000 and £885,000 estimated running costs, which brings the net cost to the Council between November 2011 and March 2015 down to £262,000.

Council Leader Michael Jones said: "I am pleased that the residents of Cheshire East now have the true picture of the costs arising from this event.

"It is important that we are fully apprised of the facts and I am satisfied that this presents a much more accurate account of how money was spent, how it was saved and how other factors came into play to mitigate the full financial impact of this episode."

The attached figures, released by Cheshire East provide a breakdown of the costs of the Lyme Green project together with projected and actual savings.

The Cheshire East Labour Group says it does not dispute the amount spent on construction works at Lyme Green without getting planning permission, nor the amounts paid to senior staff who left. However, it does dispute what costs are recoverable and what costs the council would have incurred had it gone ahead with Lyme Green. The also claim the latest figures released by the Council fail to take into account the extra administration burden caused.

Cllr Sam Corcoran said, "The latest figures quoted by Cllr Michael Jones are a travesty of creative accounting. The Conservatives now seem to be claiming that the Lyme Green fiasco was a good investment and has saved the Council money! If Cllr Jones survives the no-confidence vote on Thursday then I will be demanding that details of the figures be released."

Tags:
Cheshire East Council, Lyme Green
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Comments

Here's what readers have had to say so far. Why not add your thoughts below.

Graham Jackson
Thursday 26th February 2015 at 12:29 pm
Fantasy world accounting - its this sort of hubris that gives CEC a bad name. Surely if they had been honest, said that they had dropped that ball, the staff concerned punished and Councillors resigned then I'm sure the electorate could have moved on. Instead we get the above whitewash, tosh and general puffery.
Mark Goldsmith
Thursday 26th February 2015 at 4:25 pm
Is Cllr Jones is trying to get a job with the Qatar World Cup team?

Because the level of spin he is putting on this is up there with FIFA's finest.

Frankly, he should be sacked for even thinking that wasting a massive amount of money on a completely duff project is ameliorated by not paying running costs for the duff project.

The only true picture is what would it have cost to carry on as before (which we did) vs the money spent (ie wasted) on this project. This would not be £262k.

PS And why oh why did it cost £225k for the DIP report? This was a massively over priced report on a farce of a project. Quite apt if it wasn't our money these clowns were blowing.
DELETED ACCOUNT
Thursday 26th February 2015 at 4:40 pm
It really does sum up our Council when they attempt to justify the Lyme Green fiasco beneath a carefully constructed veneer of financial plausibility. I have every expectation that they soon be telling us that, "the stars are God's daisy chains".
Pete Taylor
Thursday 26th February 2015 at 5:25 pm
Is there an accountant in the house?

There is one in mine.
Dave Cash
Thursday 26th February 2015 at 5:40 pm
How can you subtract estimated running costs (unless reserved) from a project that was cancelled?
Can CEC offer advice on my next Tax Return?
Nick Jones
Thursday 26th February 2015 at 6:51 pm
@ Dave Cash.. financial advice.. Yes they can..... get someone to make up a random number for you, pay them with a lot of your neighbours money.. dont ask questions... take out the numbers you dont like..... then ignore the red letters..

@ Pete Taylor.. financial /factual advice .. possibly courtesy of a Mr Nick Leeson both have lost Barings.

How can you release a selectively redacted section of such an pivotal integrity related issue. The only way to satisfy the electorate will be to publish "the report" before the election,....before anyone else falls asleep on their watch..
If nobody knows what you are doing nobody knows what you are doing wrong...Openness and honesty required otherwise its just an expensive abstract nonsensical toilet roll.More spin than a fan ..soon to be halted by flying detritus.

Roll on election......
Bob Jones
Thursday 26th February 2015 at 7:13 pm
Cllr Jones wouldn't get a job as a spin doctor even for FIFA. I presume no associated severance costs are included as they might have given a clue to the redactions in the published version of the DIP Report.

Was this hopeless piece of political propaganda produced at taxpayers' expense (remember the tweets).
Pete Taylor
Thursday 26th February 2015 at 7:52 pm
Apparently all CEC Councillors have now seen the un-redacted report on the condition that they do not tell anyone else what the contents are, or name names.
Don't forget: they work for you.
Oliver Romain
Friday 27th February 2015 at 9:14 am
Beyond contempt. They think we are idiots. If the local Conservatives have any respect for the electorate they should de-select all the councillors involved in this cover up.
Ryan Dance
Friday 27th February 2015 at 9:54 am
CEC.....creative accounting at it's best..... shocking.... to then spin it.... Disgusting!

Attempting to account for costs not yet incured to reduce the overall net impact of the cancelled project.
Chris Wigley
Friday 27th February 2015 at 1:18 pm
Let's hope that the electorate across Cheshire East send a message to Michael Jones on polling day and that his party ditch him.
Nick Jones
Friday 27th February 2015 at 1:34 pm
With respect to Judge Henderson and her careful deliberations .. CEC Cllr
Sam Corcoran made a valid point in December 14, .... well over 3 yrs since this expensive debacle started .... to suggest that those named "...voluntarily request that the sections relating to their conduct are released....... the argument for councillors is different.... We should not be protecting our careers..." Surely If the report has been circulated as suggested above then by default it has now been disclosed. Honesty. Transparency. Integrity......
Strange bedfellows to some of our elected representatives. ( When measured against conduct and actions,there is a certain irony in using these last two words )
Mark Goldsmith
Friday 27th February 2015 at 3:28 pm
We should also have a DIP investigation as to why the DIP report cost £2,200 PER PAGE.

Incompetence on top of incompetence.

Cllr Jones should be ashamed of every single part of this sorry episode, including his latest statement of financial gobbledygook.
James MacDonald
Monday 2nd March 2015 at 10:39 pm
I am pleased that Michael Jones is pleased. I am only disappointed that they didn't make a net profit from this venture. In fact if they hadn't spent £365k on investigation costs they would have done. With this sort of enterprise they could make profits elsewhere and reduce our council tax bills... ;)