Guardian News and Media/London
Ministers have potentially wasted more than £20mn of public money on London’s controversial garden bridge, having more than once committed extra funds to the project against official advice, according to a report from the National Audit Office (NAO).
It found that the initial decision by George Osborne to help finance the scheme, strongly championed by the then London mayor Boris Johnson, with a £30mn grant from the department for transport (DfT), was taken despite there being questionable transport or tourism benefits.
The report casts additional doubt on the heavily delayed project, which already faces severe difficulties. Last month, the London mayor, Sadiq Khan, set up an inquiry into the use of a combined £60mn of public money, much of which has been spent before construction has begun.
Ministers initially set an £8.2mn limit on how much of the DfT’s £30mn grant could be spent on pre-construction work for the tree and plant-filled bridge across the Thames in central London. However, this limit was then raised twice, to £9.95mn in June 2015 and by another £3.5mn the following year, along with an extra financial guarantee if work were cancelled.
The report from the NAO, the independent government spending watchdog, said: “Officials from the department advised ministers against increasing the department’s exposure for the second and third increases.”
It noted a “pattern of behaviour” throughout the project in which the Garden Bridge Trust, the charity behind the Thomas Heatherwick-designed project, repeatedly asked the DfT for more money when it encountered challenges. “The department, in turn, has agreed to these requests,” the report said.
Meg Hillier, the Labour MP who chairs the powerful Commons public accounts committee, likened the pattern of repeated requests for more public money to the collapse of the Kids Company charity. “It worries me that whenever the Garden Bridge Trust runs into financial trouble, the department for transport releases more taxpayers’ money before construction has even started,” she said. “If the project collapses, taxpayers stand to lose £22.5mn.”
Tim Farron, the Liberal Democrat leader, said the bridge was “a vanity project” for Johnson, and it was up to Khan to quash it. He added: “It is an unnecessary expenditure and will have little benefit to Londoners.” The NAO found that the government’s liabilities towards the scheme stand at £22.5mn if the bridge is not built, which the report says is possible.
“There remains a significant risk that the project will not go ahead,” it said. The Garden Bridge Trust has yet to secure the necessary sub-lease on the area of the South Bank where the bridge will land, the report notes, while the main contractor has been put on standby and construction has been delayed for at least 18 months.
The government’s involvement in the planned 366m (1,200ft) structure running from Temple to the South Bank, intended to hold 270 trees and thousands of plants, began in 2013 when the then chancellor Osborne agreed the £30mn grant with Johnson, to be directed through the DfT.
This happened despite the department finding that the transport case for the pedestrian bridge in terms of faster walking times was minimal and benefits from tourism were “considered highly uncertain”.
“The department agreed to make the £30mn investment in spite of its concerns about the value for money of the bridge,” the NAO said. In May 2016, ministers agreed to underwrite cancellation liabilities of up to £15mn, giving a peak DfT liability of £28.5mn. The guarantee was reduced later that year to £9mn.
The DfT receives written monthly updates from the Garden Bridge Trust on the project, but these do not contain “standard project performance information,” such as progress against schedule and budget, or details of the trust’s progress against fundraising targets, the NAO noted.
Public investment accounts for £60mn of the scheme’s projected £185mn cost, of which Transport for London provided £30mn, with £20mn of this later turned into a long-term loan. The remainder is still being raised from private donors.
The NAO report noted that one of the reasons the trust repeatedly asked for more DfT cash to be spent before construction was the unwillingness of private donors for their money to be used before they were sure the bridge would be built.
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