Stadium for Cornwall: Council votes not to put public money into project

At the Full Council meeting of 15 May, members voted by 55 votes to 46 not to support further work on the project.

Some members wanted the Cabinet to consider an investment of £10 million of public money in the stadium subject to a full business case being developed. Others felt that there was no realistic prospect of the project being viable and/or they felt that it was wrong in principle for public money to be put into such a project.

The Council papers for this item can be downloaded from Stadium Project.

I voted against the project. I have been asked by some why I voted that way. In an email to a constituent, I said the following:

"First, I have absolutely no problem with the principle of a new stadium being built in Cornwall for sport and I have no problem with the proposed location at Threemilestone. Some of my colleagues may have concerns about the location, but my feeling is that, if a stadium is going to be built, putting it close to the centre of Truro and close to reasonable public transport routes is the sensible place to do it.

My concerns are about who should pay for this facility. This stadium would primarily be used by one, or two, professional sports teams. These teams are private businesses that collect money from spectators and pay players and other staff. These are not the only rugby and football teams in the county. 

In principle, it is difficult to justify putting significant amounts of council taxpayers' money into a facility which would benefit just these two businesses. There are many other rugby and football teams who would, quite rightly, feel that it was unfair to support those two teams and not others. It could even be challenged legally.

Even if the concept of providing support to just two teams could be justified, having a good stadium would be no guarantee of success on the field of play. There are many professional football teams which have excellent stadiums but are languishing in the lower divisions of the football league. There are also many who have gone into administration, some more than once, despite having very good playing venues. The same applies to many rugby teams. Cornish Pirates and Truro City FC happen to be the most successful teams in the two sports at the moment, although there is no guarantee that they will always be the top teams in the county with or without a stadium. 

Truro City FC are due in court within the next few weeks yet again as HMRC seek to have them wound up for non payment of PAYE. The club has staved off winding-up orders a couple of times, but there is no guarantee that they will do so again. It would be sad if Truro FC was wound up, but their suitability as a tenant of the new stadium has to be questionable whilst this uncertainty continues.

The sums of money being asked of the Council is very significant. A sum of £10 million is being quoted at the moment, although it was only a few weeks ago that the project team were claiming that no public money would be required. There is no evidence of where the rest of the capital investment would come from other than we know that Truro College (another public body) could put in £2M. Inox, the "developer" has no funds to put into the project. All their talk about obtaining funding from other sources has been wishful thinking. A simple search in Companies House (which I have done) shows that the Inox companies are not the big financial powerhouse that they purport to be. It is entirely foreseeable that the Council's £10M would grow to even more. 

With regard to the annual running costs of the stadium, there is no guarantee that it would not make a loss. Again, the evidence from around the country is that running a stadium at breakeven, let alone a profit, is very difficult. Even the new Wembley continues to have major financial problems such that it has to host a whole variety of events of all shapes and sizes. As a consequence, the pitch has to be relaid a few times every year. In my view, the Stadium for Cornwall would continue to be a drain on annual resources throughout its life.

As for the forecasts of the supposed economic benefits that the stadium would bring to Cornwall, I accept that some financial benefits would accrue, but, to be frank, I just do not believe the forecasts made by the consultants. Having seen so many forecasts by consultants about economic regeneration projects, I am inherently cynical about the figures that they provide. They always promise untold wealth and benefits to the economy. They are usually proved to be ridiculously optimistic after the event.

If the Council wishes to support and promote sport, I think that it would be fairer, cheaper and more beneficial to provide ongoing revenue support to those sports and clubs or organisations that show that they are promoting more participation from young people and developing their skills and talent. A few tens of thousands of pounds to get hundreds of youngsters out on a Saturday or Sunday morning on a football or rugby pitch getting coaching from professionals would be a good thing.

In conclusion, I remain of the view that putting significant sums of Council taxpayers' money into a glamour project such as the Stadium for Cornwall is not the right thing to do."

Bob Egerton, 18 May 2012

May 2012