Croydon Council could face huge punitive fines if it fails to meet strict deadlines as part of its regeneration plans, the Croydon Guardian can reveal.
Croydon council would be liable for fines of up to £100,000 for every week it delays in plans to remove tenants from its Fell Road site.
The building is due to be demolished and replaced with a new public sector hub under the council’s Urban Regeneration Vehicle, a partnership with developers John Laing.
As part of the agreement, the council has selected four sites – Fell Road, College Green, Taberner House and the Tamworth Annex – to be regenerated by John Laing, with each party receiving a 50 per cent share of the profits.
The first stage is the decanting of Fell Road into recently acquired Davis House. This requires the council to acquire the leases of floors three and six, which currently house companies Intuitive and Metropolis Business Publishers respectively.
This process is estimated to cost almost £6m.
Despite the council yet to secure planning permission, it plans to have this completed by December 18, but has been set a deadline of January 2010 by John Laing.
Should they go beyond that date they will be liable for costs incurred by the developers, estimated at £100,000 a week.
Councillor Tony Newman, leader of the opposition, said: “If these figures are true then this is appalling news for the tax payers of Croydon.
“What is the council is doing when it is a 50-50 partner in an organisation getting involved in a contract where the tax payers foot the bill for any delays?
“This is potentially a massive waste of taxpayers’ money.”
A council spokesman said he could not confirm any figures due to “commercial reasons”.
He said: “In order to move ahead with the public service delivery hub on Fell Road, we need to empty the ‘60s municipal offices block that currently occupies the site. Intensive planning is taking place so that the forthcoming decant involves minimal disruption to staff affected by the move and therefore minimal disruption to services.
“We are confident that the project, which has yet to receive planning permission, will prove to be a sensible, value for money investment in the way in which public services are provided in Croydon for the next 50 years or so.
"This is in line with our long-term aim for a cost-effective solution to the mounting expense of running council services from the inefficient Taberner House.”
Comments: Our rules
We want our comments to be a lively and valuable part of our community - a place where readers can debate and engage with the most important local issues. The ability to comment on our stories is a privilege, not a right, however, and that privilege may be withdrawn if it is abused or misused.
Please report any comments that break our rules.
Read the rules here