East Herts District Council - Causeway building is a millstone

30 Jul 2009 - Article in the Herts & Essex Observer

The Conservative council chiefs [who are] behind plans to pay £5m to quit the Causeway in Bishop’s Stortford and centralise East Herts services in Hertford have answered their critics this week.

In an exclusive briefing yesterday (Wednesday) leader Councillor Tony Jackson and executive member Mike Tindale, the Little Hadham councillor who holds the portfolio for resources and internal support, robustly defended their decision to seal the contract with landlord Henderson, freeing the central location for massive retail, residential and commercial redevelopment.

Cllr Tindale said: “We are 100 per cent sure that this is the right deal for the council and in the best interests of the council taxpayers.” The complex transaction, which has been questioned by both Liberal Democrat and Independent opposition members, revolves around four key sites of which the council holds the freehold: the Causeway offices where it is currently based, the neighbouring Charringtons building where it wants to set up a new and improved frontline service and the Waitrose and Causeway car parks.

Henderson holds the residue of 125-year leases on the two office blocks, and to release the council from its 90-year commitment to the Causeway, it insisted on £5m plus new 999-year leases on all four sites for a total payment of £7.35m, leaving the authority with £2.35m in the bank. The council will lease back space at Charringtons for an annual rent of £141,855 and – crucially, according to the executive – avoid a £1.9m bill to upgrade the Causeway. Cllr Jackson insisted the authority had taken expert advice and was prudent, despite current economic turmoil, to press ahead. Critics claimed the council was selling at the worst possible time and undervaluing its assets in a “naïve” transaction, but he stressed: “This [Causeway] building has been a millstone.” He pledged: “The public will see an improvement in services and we believe whatever happens on this site will add value for the town.”

Both Cllr Jackson and Cllr Tindale argued that while the Causeway deal dovetailed with the streamlining of its services by centralising in Hertford, the two initiatives were not mutually dependant Cllr Tindale said: “The status quo is not an option going forward. Staying here would be the wrong decision for tax-payers.” He was unable to say how much the changes in working practice would cost to resource, but believed a saving of £1.5 would ultimately result.