A Tory-led district council has announced it will legally challenge Defra’s decision to part-fund the controversial £500m Norfolk incinerator project, claiming financial arrangements impeded fair debate.
Borough Council of King’s Lynn & West Norfolk leader Nick Daubney said Norfolk County Council, which gave the plans the go-ahead, had conflicted interests as it faced £20m worth of break clause costs if the deal fell through.
The borough council passed a motion last week to proceed with legal action against the government’s decision to release the £91m of PFI credits to help fund the scheme. The council will appeal for a judicial review and for communities secretary Eric Pickles to call in the scheme for determination.
The council motion said: “This Council reiterates its belief (as determined at Council on 17 March 2011) that financial arrangements in place between Norfolk County Council and the preferred contractors impede open and fair debate during the planning process.”
Norfolk County Council declined to comment on the borough council’s legal challenge. But PFI advisors told MRW that break clauses were common in large infrastructure projects, especially where there were planning concerns.
Environment secretary Caroline Spelman last month released the private finance initiative credits to help fund the energy-from-waste project near King’s Lynn, which will be built and run by Anglo-US consortium Cory Wheelabrator.
Spelman had withheld the credits last year following widespread local opposition, but said she was now satisfied it met the criteria for PFI funding.
Speaking after Spelman released the credits, the county council’s cabinet member for environment and waste, Bill Borrett, said: “The grant will substantially reduce the cost of a proposed new service for dealing with Norfolk residents’ waste, making it excellent value for money.
“It also reflects the government’s opinion that projects such as this will help the country meet its European landfill diversion targets.”
Nadeem Arshad, partner with law firm Bevan Brittan, last week told MRW that if the government had withheld the credits, it could have had a negative impact on other waste PFI projects currently in procurement.
Extracts from the Borough Council of King’s Lynn & West Norfolk motion
The Borough Council does not believe that the project, in any way, commands a broad consensus of support. Indeed since the Secretary of State initially expressed concern on this issue, support for the project has, if anything diminished.
The Council therefore instructs officers to examine the basis of the decision taken by the Secretary of State to award PFI credit to Norfolk County Council. Council further instructs officers to formally commence the essential and necessary steps to apply for a judicial review of that decision.
We repeat our request to the Secretary of State for Communities and Local Government to “call in” the matter for determination