Updated: Pier Hill 'blunder' could cost council £1.7m (From Echo)

Updated: Pier Hill 'blunder' could cost council £1.7m

9:24am Wednesday 17th September 2008 in News By Geoff Percival

The Pier Hill viewing tower

SOUTHEND Council may have to repay nearly £1.7million to the European Union after an alleged blunder over the prestigious Pier Hill improvement scheme.

The council has been accused of failing to go through proper channels when awarding the contract for the £6million works to civil engineering firm Fitzpatrick in 2003.

Borough treasurer Martin Hone said auditors brought in to check the accounts said the council should have put the contract out to tender rather than just awarding it to Fitzpatrick.

As a result, the auditors have warned the council could have to refund a significant part of the grant.

This could be up to £1.7million. The situation was been described as an “utter farce” by council leader Nigel Holdcroft, who said the council would be fighting to make sure the money could be saved for the town.

He said: “We took outside advice from consultants at the time and were advised we could deal with the matter in the way which we did. “It is ridiculous the issue has arisen again following an audit carried out by our external auditors, Pricewat-erhouseCoopers, last year.”

Conservative councillor Mr Holdcroft added: “It isn’t even as if the money would be used elsewhere in this country if it was paid back.

“It would go straight to Europe. “We will continue to negotiate with the Government Office for the East of England about the matter to try and find a solution which does not involve giving back the money.

“Otherwise we will be looking for redress from the advisors we had at the time.”

At the time the contract was awarded, council chiefs said the money needed to be spent “as a matter of extreme urgency” because there was a time limit on the grant, awarded through Thames Gateway.

But the auditors said the need to spend the money quickly was not adequate justification for bypassing the normal procedure of getting a number of quotes before awarding a contract.

Mr Hone said the council would continue to fight to keep the cash, arguing it was a “very special set of circumstances”. The Pier Hill scheme involved the remodelling of the hill itself and the provision of the new lifts and viewing platforms across the estuary.

The total cost of the scheme was £6,451,000, half paid for by the European Union and the other half by the council.

A report on the issue will be considered by the council cabinet next week.