£1.7m fund put aside for Friars Walk
Updated 12:01pm Monday 9th June 2014 in News
A FUND of more than £1 million is set to be put aside by Newport council for the Friars Walk scheme in case a plan to loan £90 million to the shopping complex hits the buffers.
Documents for today’s Newport council meeting show the authority had £3.9 million spare at the end of the 2013/14 year.
Senior councillors have been recommended to invest the cash in reserves – including £1.7 million to mitigate for any financial impact of the shopping and leisure project.
According to the report, Newport council services under spent by £2.5 million in the 2013/14 financial year – £1.8 million of which was saved due to job vacancies. This, combined with the fact the council’s contingency budget of £1.4 million was not used, left the authority with £3.9 million spare.
Officers have set out how the money they recommend should be allocated into reserves.
The report says £1.75 million could be allocated for a reserve fund for the Friars Walk scheme.
Newport council has pledged to provide a loan of up to £90 million, which the authority would borrow, to finance Friars Walk.
Officers argue profits made on interest charges to developers Queensberry are designed to provide a limited financial buffer against any potential losses due to delay or default.
According to the report physical work to clear the Friars Walk site, near John Frost Square, has been completed and construction work will start shortly.
As well as the cash for Friars Walk the cabinet report also proposes £152,000 is allocated to increase funds in a reserve designed to help the council meet landfill targets.
Another £1 million could also be allocated for reserves for possible future infrastructure projects.
Cabinet will decide whether to go ahead with the proposals on Monday.
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