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Concerns over risk to public funds in TVR deal

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TAXPAYERS could face a multi-million-pound bill after the Welsh Government spent more than £14m on a failed attempt to attract sports car manufacturer TVR to Wales.

Adrian Crompton, the auditor general for Wales, said the Welsh Government spent £4.75m buying the former Techboard factory in 2021 and £7.6m on refurbishment.

TVR received a £2m five-year loan and a £500,000 investment from the public purse, with the aim of creating 150 jobs and building 2,000 sports cars in Ebbw Vale by 2020.

But at the turn of 2024, the carmaker confirmed it no longer wants to lease the factory – or locate production in Wales – after announcing a new base in Hampshire.

Mr Crompton, who oversees the annual audit of some £24bn of public money, said selling the building for a market value of about £7.5m would net taxpayers a loss of £4.85m.

In a letter dated July 12, he told a Senedd committee that ministers have been trying to find an alternative tenant since November, with TVR paying a £322-a-month rent in that time.

Mr Crompton wrote that the 180,000 sq ft factory – which could generate an income of about £735,000 a year – has attracted some market interest but no formal offers.

Wales’ auditor general said Welsh Government officials’ advice was not to award a contract for the factory refurbishment in advance of a lease agreement with TVR

But he told the public accounts committee: “In August 2020, the minister wrote to TVR telling them the Welsh Government would progress refurbishment with or without them.”

Refurbishment of the factory, which was initially expected to cost £4.5m in 2017, was finally completed in July 2023 with the budget having ballooned to £7.6m.

Taxpayers could be on the hook for a botched investment in the company’s shares, the letter revealed, despite TVR being deemed a high-risk business at the time.

The Welsh Government bought 3.3% of the sports car manufacturer in 2016 but the public’s stake in the company has since more than halved to 1.6%.

TVR received a multi-million investment as part of a joint venture with Ensorcia, a lithium-mining business, which diluted the Welsh Government’s shareholding in 2021.

In May, ministers received external advice about the TVR stake – including a lower valuation than paid in 2016 – and secured an option to sell the shares back to the company.

Officials are now preparing ministerial advice for a decision on whether to sell the shares at a loss or retain the investment in the hope the price increases.

Mr Crompton said TVR breached loan requirements in September 2016 because it had not secured a promised £5.5m private-sector investment to start production.

He added that TVR negotiated extensions to the Welsh Government’s loan default requirement, which otherwise would have led to early repayment in full

In April 2022, TVR paid the Welsh Government £4.3m, covering the £2m loan and accrued interest, which released the company from a requirement to base itself in Wales.

Mr Crompton wrote: “The Welsh Government had to extend the loan repayment period but still achieved a return on investment when TVR eventually repaid it….

“Full repayment has now removed the conditions that were originally attached to the loan.”

In his briefing, the auditor general said he reviewed Welsh Government support for TVR after receiving correspondence that expressed concerns about the risk to public funds.

Mr Crompton pointed out that the public purse will have incurred further costs in terms of officials’ time over many years, external advice and professional fees.

Ministers’ attempts to woo TVR coincided with the failed £425m Circuit of Wales project.

The proposals for a motor racing circuit in Blaenau Gwent collapsed in 2017, with Ken Skates, then-economy minister, refusing to underwrite a £210m loan.

In 2020, Mr Skates wrote off nearly £15m related to loans for the Circuit of Wales after failing to claw back taxpayers’ money.

Business

Salon plans for Haverfordwest car valet site approved

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RETROSPECTIVE plans to change a Pembrokeshire car sales/valet area to include a barber shop and tanning salon have been given the go-ahead.

In an application to Pembrokeshire County Council, Zizo Barbers & Affordable Cars, of Cambrian Place, Haverfordwest sought permission for the change of use of previously granted valet and car sales area, the works completed in 2024.

A supporting statement through agent Hayston Developments & Planning Ltd said the former commercial garage business has been operating in several guises from the premises for many years and has included petrol sales, motor servicing and repairs, MoTs, vehicle valeting, car sales and customer parking.

This followed on from a 2011 permission for the partial demolition of the original commercial garage, with a later approval for the site refurbishment to provide a workshop, valeting and offices for the existing car sales.

A supporting statement said: “The proposed update to a change of use involves the replacement of a car valeting service, which took place under a covered area at the rear of the site by a wash and valet operation – and restricting this service to those cars being sold at the Cambrian Place site. The use of a former office / store as a barber shop.

“The use of the former customer waiting area as a tanning salon including a new moveable timber shed for use as a meet and greet facility and as a car sales office. Provision of a communal parking area. Whilst retaining the principal use of the site for the sale of used cars.

“It is therefore suggested that the proposal will reduce both the elements of noise and the generation of dust whilst improving air quality as substantially fewer cars being power washed and valeted as well as the visual impact of these activities in this very public location – and with adjacent residential properties.”

Haverfordwest Town Council had objected to the scheme on highway safety grounds, but an officer report recommending approval said: “Highways colleagues have advised that the mixed use at the site is not likely to generate a significant number of trips that would lead to congestion and/or road safety issues due to the hours of operation are suggestive of visitors in the non-peak hours over the course of the day.

“In addition, highways colleagues have confirmed recorded accident history is negligible at the site, with one accident in 2023 at the nearby junction as a result of a rear shunt.”

It also said that, as the site lies adjacent to the A40(T) Welsh Government as a highway authority were consulted on the application, but has not not issued a direction in respect of this application.

One letter of objection had also raised issues of traffic and highway safety, chemical and detergent waste from the site and occasional activity after 5pm.

The report said the cessation of the valeting/washing use will reduce water usage at the site and any activity outside normal hours was an enforcement matter.

The application was conditionally approved by officers.

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Business

Community council objections to Tenby Lidl store scheme

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PLANS for a new store on the edge of Tenby by retail giant Lidl, which has seen objections from the local community council, are likely to be heard next year.

In an application recently lodged with Pembrokeshire County Council back in October, Lidl GB Ltd, through agent CarneySweeney, seeks permission for a new 1,969sqm store on land at Park House Court, Narberth Road, New Hedges/Tenby, to the north of the Park Court Nursing Home.

The proposals for the latest specification Lidl store, which includes 103 parking spaces, would create 40 jobs, the applicants say.

The application follows draft proposals submitted in 2024 and public consultations on the scheme, with a leaflet drop delivered to 8,605 local properties; an information website, with online feedback form; and a public exhibition, held last December at the De Valence Pavillion in Tenby, with a follow-up community event held at New Hedges Village Hall, close to the site, publicised through an additional postcard issued to 2,060 properties.

Some 1,365 responses have been received, with 89 per cent of respondents expressing support for the proposals, the applicants say.

A supporting statement says: “Lidl is now exceptionally well established in the UK with the Company operating c.980 stores from sites and premises both within and outside town centres. Its market share continues to increase substantially, and the company is expanding its store network considerably. The UK operational model is based firmly on the success of Lidl’s operations abroad with more than 10,800 stores trading across Europe.

It adds: “The granting of planning permission for the erection of a new Lidl food store would increase the retail offer and boost the local economy.  The new Lidl food store would create up to 40 employment opportunities for people of all ages and backgrounds, providing opportunities for training and career development.  This in turn will create an upward spiral of economic benefits.”

Local community council St Mary Out Liberty Community Council has formally objected to the scheme, saying that, while it supports the scheme for a Lidl store in principle, recognising “the economic benefits a new retail store could bring,” it says the proposed location “is unsuitable, conflicts with planning policy, and cannot be supported in its current form”.

Its objections add: “The A478 is heavily congested in peak tourist months. A supermarket would worsen congestion, increase turning movements, and heighten risks to pedestrians, cyclists, and emergency access.”

It also raises concerns on the potential impact through “noise, lighting, traffic disturbance, and loss of quiet amenity” on a neighbouring residential care home.

An initial assessment by Pembrokeshire County Council, highlighted concerns about the visual impact, with the authority’s landscape officer commenting that the store would introduce “an intense urban function into an otherwise rural context”.

The report added: “It is not considered to be compatible with the character of the site and the area within which it is located; and furthermore, will lead to a harmful visual impact on the setting of the National Park.”

The application will be considered by county planners at a later date.

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Business

Senedd approves £116m transitional relief for business rates

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BUSINESSES facing sharp hikes in tax bills after the 2026 revaluation will see increases phased in over two years after the Senedd backed a new transitional relief scheme.

Senedd Members unanimously approved regulations to help businesses which face significant rises in non-domestic rates bills after a revaluation taking effect in April 2026.

The Welsh Government estimates the transitional relief will support 25,000 ratepayers at a cost of £77m in 2026/27 and £39m in 2027/28. The partial relief covers 67% of the increase in the first year and 34% in the second.

Mark Drakeford, Wales’ finance secretary, stressed the £116m scheme comes on top of permanent rate reliefs which are currently worth £250m a year. He said ratepayers for two-thirds of properties will pay no bill at all or receive some level of relief.

The former First Minister told the Senedd: “In providing this transitional relief scheme, we are closely replicating the scheme of relief we provided following the 2023 revaluation – supporting all areas of the tax base in a consistent and straightforward manner.”

The Conservatives’ Sam Rowlands expressed his party’s support for the transitional relief scheme which will help ratepayers facing sharp increases after the 2026 revaluation.

Conservative MS Sam Rowlands
Conservative MS Sam Rowlands

He said: “We are grateful that the Welsh Government has at least brought forward a scheme that will soften the immediate impact for thousands of Welsh businesses.

“We also understand that if these regulations are not approved or supported… this relief scheme will not be in existence. Many businesses across Wales would face steep increases with no protection at all and that is certainly not an outcome we would want.”

But the shadow finance secretary warned businesses up and down Wales are worried about the increase in rates that they are liable to pay.

Advocating scrapping rates for all small businesses in Wales, Mr Rowlands said: “We’ve heard first-hand from many of those in the hospitality and leisure sector, some of whom are facing increases of over 100% in the tax rates they are expected to pay.”

Responding as the Senedd signed off on the scheme on December 16, Prof Drakeford said the Welsh Government had to wait for the UK budget to know if funding was available. As a result of the time constraints, the regulations were not subject to formal consultation.

Prof Drakeford agreed with Mr Rowlands that voting against the regulations would not improve support, only eliminate the transitional relief package before the Senedd.

Finance secretary Mark Drakeford
Finance secretary Mark Drakeford

Earlier in Tuesday’s Senedd proceedings, former Tory group leader Paul Davies warned Welsh businesses have already been hit with some of the highest business rates in the UK.

He said: “The latest business rates revaluation has meant that some businesses are now facing rises of several hundred per cent compared with previous assessments…

“Whilst I appreciate that a transitional relief scheme will help some businesses manage these changes, the reality is that for many businesses it’s not enough and some businesses will be forced into a position where they will have to close.”

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