Compensation for Norfolk incinerator ‘considerably lower’ than expected
- Credit: Matthew Usher
The compensation which Norfolk County Council has paid out because of the aborted incinerator is 'considerably lower' than the £20.3m County Hall bosses expected to have to hand over, it has been revealed.
The county council says it cannot yet reveal the precise figure it paid this week to Cory Wheelabrator, which would have built and run the incinerator, because it is commercially sensitive.
But, it is understood to be millions of pounds lower than the capped maximum, which was fixed at £20.3m under the terms of the contract.
The county council voted by 48 votes to 30 to terminate the contract for the proposed incinerator at Saddlebow, near King's Lynn, at an extraordinary meeting in April.
Council officers had said that, due to delays in securing planning permission for the Willows project, the controversial project no longer offered good value for money, and councillors agreed to ditch it.
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In July, the council paid just over £11m to the banks for in interest rate-related hedging costs and a deal has been struck have been taking place with Cory Wheelabrator over the compensation payable to them.
George Nobbs, leader of Norfolk County Council, said: 'Given the stark financial position this council finds itself in - with demand for critical services continuing to increase, whilst funding from central government decreases, despite more duties and functions given to us to perform, it has never been more imperative that Norfolk County Council has robust financial management in place.
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'As a consequence of secretary of state Eric Pickles' failure to make a decision on the Willows application, this council was well aware that the result of terminating the energy from waste contract would require us to pay compensation.
'Before the contract was terminated we began to build up a financial reserve to meet this cost.
'A payment was required on September 2 and has been made by the council and I am pleased that the figure is considerably lower than the £20.3m we had previously reported, and expected, we would have to pay.'
The announcement over the compensation was made at a meeting of the county council's policy and resources committee yesterday.
At the meeting, councillors also discussed the need to close a £17.5m shortfall in the 2015/16 budget, with officers suggesting they might want to consider increasing council tax, with the money raised potentially being specifically earmarked for certain uses.
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