The new revelation comes amid a final flurry of debate, claim and counter-claim ahead of a vote on Wednesday over the future use of Aberdeen’s Union Terrace Gardens, an exchange that has even drawn in pop singer Annie Lennox and Scotland’s top architecture body.
The crux of next week’s vote is whether to approve the proposal to convert the gardens into a city square or build an arts centre. The city square plan is spearheaded by Aberdeen City and Shire Economic Future (Acsef).
However, Peacock Visual Arts already has planning permission for the site and 75% of its £13m funding in place to build a new arts centre in the gardens.
After 18 acrimonious months, the vote will decide which scheme gets the go ahead. But according to an independent financial commentator Acsef’s figures do not add up.
Of the £140m needed, oil tycoon Sir Ian Wood has pledged £50m to the scheme, and Acsef expects the private sector to add a further £20m.
Acsef said the project plans to borrow the remaining £70m in loans, based on the expected increased business rates for the area. This system, tax increment finance (TIF), has the philosophy is “paying for growth with growth”.
However, a paper prepared by PriceWaterhouseCoopers dated May 6 on the feasibility of TIF being used in this project has raised questions over Acsef’s sums. TIF has yet to be used in the UK and Aberdeen would need the Scottish Parliament to pass legislation for money generated by increased business rates in the city to remain in the city, rather than go to central government for redistribution, as normally happens.
The report also questioned whether the project would be able to generate enough income to meet any interest payments in its first years.
Using the figures from the report, an independent financial commentator has estimated that at an interest rate of 3%, the common rate local authorities borrow at, the £70m loan would cost £150m over 25 years. Acsef has dismissed the £150m figure.
This comes days after Aberdeen-born Lennox wrote to every councillor urging them to follow the wishes of the people on Wednesday and reject the city square plan. Last month the public consultation revealed that 55% of locals were against the plan.
Lennox said: “To carry on with the city square would be an act of civic vandalism and abandonment of democracy.”
Peacock Visual Arts has also urged the councillors to make a final decision and said further delays would kill its plans to build a centre within the gardens.
As well as a time-sensitive and project-specific £4.5m grant from the Scottish Arts Council, Peacock has the chance of a £1m grant, but needs to apply by early June.
Meanwhile, the war of words between the Royal Incorporation of Architects Scotland (RIAS) and Acsef continued.
After a strongly worded letter last week to Scottish Enterprise, in which he stated the budget would be at least twice the £140m figure and condemned plans for an international design competition that would exclude Scottish architects, RIAS secretary Neil Baxter has called the city square project “daft and devious”.
He said: “Daft in that it is a very poor, ill thought through idea. Devious because what this proposal does is prevent any positive regeneration of the area.”
A spokeswoman for Acsef called Baxter’s comments “highly inappropriate and surprising”, adding: “Acsef reiterates that this is a civic project that will be controlled by the city of Aberdeen and its citizens.”
Aberdeen City Council stressed that Wednesday’s meeting will be about the future of the whole city centre, not just the future of Union Terrace Gardens.
For in-depth arguments from Acsef and Peacock Visual Arts for their respective schemes see ‘The final push’ in Related Content above, top right
