ONE of Scotland's richest men has committed an extra £35million to support a controversial city centre project.
Oil tycoon Sir Ian Wood is now prepared to pay a total of £85m to support the £140m project to transform Aberdeen's Union Terrace Gardens into The Granite Web, a futuristic network of paths over grass parkland.
As opponents cast doubts over a potential cost overrun, Sir Ian said he wanted the Aberdeen public to be confident the price of the project will not spiral out of control, as happened with the Edinburgh trams project, and has pledged the extra funds.
Local people will vote this month in a referendum to establish whether they want to create new gardens based on The Granite Web design or retain them as they are.
Sir Ian's family trust has already committed £50m to the project, with £200,000 to help pay for the referendum which closes on March 1.
The Wood Family Trust issued a statement yesterday after discussions with Aberdeen City Council, saying it was now prepared to make the additional funds available to the City Garden Project "in the very unlikely event of cost overruns".
Sir Ian Wood, chairman of the Wood Family Trust, said: "Concerns have been expressed about the impact of any potential cost overrun to the City Garden Project. These are being irresponsibly fuelled by mis-information and unfounded speculation."
Sir Ian said the estimated total cost of £140m had been verified by independent technical experts. The Granite Web was a particularly cost effective design, which should be delivered within the £140m estimate, which already includes contingencies.
"However, to reassure the taxpayer this project will not take funds away from local services provided by the council and to demonstrate my confidence in the cost estimates, Wood Family Trust will give an undertaking to the council to pay for any cost overrun up to 25% of the £140m estimate to cover the very unlikely event of any cost escalation," he said. "This should eliminate any concerns on this issue."
Sir Ian said there was too much at stake for Aberdeen and its citizens, to lose the project. The business case had demonstrated how the creation of more than 6000 jobs and an additional £122m in the economy every year would be achieved.
He added: "As the oil generation citizens of Aberdeen, we have this once-in-a-lifetime chance to transform our city with an enormous investment – an investment which will be lost forever and given to another area of Scotland unless we grasp the opportunity."
But responding to Sir Ian's announcement, Mike Shepherd, of the Friends of Union Terrace Gardens, which opposed the project, said: "This is the result of our group's persistent questioning over the past two years.
"We are glad our concerns have at last been recognised. We would even ask if 25% is enough given the massive cost overruns seen in other Scottish civil projects such as the Edinburgh Trams debacle."
Aberdeen City Council plans to use Tax Incremental Financing (TIF) to secure a maximum of £70m for the gardens project, in recognition of its importance to city centre regeneration.
TIF is a means of funding public sector investment which may otherwise be unaffordable to local authorities, by using future additional revenue gains from taxes to finance the borrowing required.
But Mr Shepherd said: "Does the reserve contingency also cover the risk of Aberdeen Council's borrowing through TIF?
"If there is not enough income or interest rates hike up, then the council could be left with outstanding debt after 25 years."
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