Wednesday 27 March not only heralded the end of Lent and the start of Easter. The date also marked two decisions about finances in the Tees Valley.
Billingham
Billingham Town Council voted to scrap its Sunday Lunch Service which delivers free two-course weekly dinners to local vulnerable elderly people. In its four years of operation the service has delivered 10,000 Sunday lunches and has supported over 400 residents.
At the moment 72 elderly people enjoy the free dinner service, which employs two paid staff (totalling 6.5 hours a week) and a team of volunteers.
The decision to close the scheme, which included votes from three Labour town councillors, sparked an angry response from the Town Council Chair, Stockton councillor Clare Gamble, who has resigned in protest.
Teesworks and PD Ports
In another part of the Tees Valley, Wednesday brought bad news to Conservative Tees Valley Mayor Ben Houchen, now Lord of High Leven.
A judgement on costs in the High Court in London ruled against the Tees Valley Combined Authority’s South Tees Development Corporation (STDC) and its joint venture Teesworks Ltd. The latter was established to manage regeneration of the 2,500-acre old steelworks site near the mouth of the Tees – also confusingly called Teesworks.
The court case was brought against PD Ports Teesside in a bid to gain a ransom payment for access across Teesworks land to PD Ports’ property, despite documented evidence of the statutory harbour authority’s legal access going back over a century.
The fee demanded by Teesworks Ltd in a settlement offer 10 months before the court action was not trifling. PD Ports would have to pay STDC 90% of their income from charges on goods accepted by Teesworks tenants.
90% of the Teesworks Ltd joint venture was given to private interests controlled by four businessmen led by Chris Musgrave and Martin Corney. According to Private Eye, by March last year the companies controlled by the two leading businessmen had made £124mn in pre-tax profits from the project. The Gove investigation into Teesworks put the figure by July last year at £108mn after tax. This is without investing a penny.
Their earnings are from the sale of lucrative scrap from the site; a purchase/sale flip of development land; and consultancy services.
The public purse meanwhile has coughed up over £500mn to clean up the highly polluted site and ready it for tenants.
In a November 2021 deed appended to the Gove report on Teesworks (Appendix 4), STDC had agreed to pay Musgrave and Corney’s company up to £54mn for “consultancy services” over the land dispute with PD Ports.
The deed also guaranteed that Teesworks Ltd would be entitled to a maximum of £54mn if PD Ports had to pay cash for access rights.
The ruling on Wednesday instructed an interim payment for legal fees to PD Ports of £1.2mn. With legal fees already topping £3.1mn that’s a bill to Teesworks Ltd and STDC of a likely £4.3mn
That does not include the working time spent on the three-year case by well-paid STDC officials. The CEO of STDC, Julie Gilhespie, enjoys a salary of £173,000 a year.
There’ll be little hardship for Teesworks Ltd, which seems little more than a vehicle for channelling public money and collecting income from scrap on the site. However, the company has declared that it will appeal the High Court rulings. STDC has indicated that it will not appeal.
Next year’s running costs for Billingham’s Sunday Dinner Service were projected to be £8,000 – equivalent to 0.2% of STDC’s legal costs in the PD Ports access case.
Musgrave’s 26 year old son Joe whose company has made stellar profits from leasing plant on the Teesworks site, recently took delivery of a £300,000 Rolls Royce Cullinan.
In the recent Gove Inquiry, Houchen and STDC were cleared of corruption allegations. There remain 28 recommendations that Houchen is required to put into action.
