Anger after Government blocks city council from asset buying plan

MINISTERS have been accused of attempting to block Hull City Council buying assets from the axed Yorkshire Forward.

Stephen Brady, leader of the council's Labour group, has criticised Whitehall for stopping the handover of key sites on a "buy now, pay later" basis.

The sites include the Humber Quays office complex next to Hull Marina and land adjoining St Stephen's shopping centre.

Now, the council has been told it must pay market value for the multi-million-pound regeneration projects funded by regional development agency (RDA) Yorkshire Forward, which has assets estimated at �220 million.

Councillor Brady is just one of 19 councillors to have written to Business Secretary Vince Cable urging him to "think again". He said: "We are dismayed at the Government's decision to effectively shut out local authorities from the bidding process for the strategic assets of the former RDAs.

"At a time when unemployment is rising and the growth forecasts have been downgraded, we believe the Government should be supporting councils to drive growth in their areas and create the private sector jobs and investments we need for the future, not holding them back.

"By not allowing local authorities to purchase strategic assets from former RDAs through a delayed payments agreement at a time when they face an average cut of 27 per cent to their budgets, the Government is pricing them out of the competition to keep these vital tools for growth."

St Stephen's shopping centre was bought under compulsory purchase when Yorkshire Forward joined forces with the city council to assemble the site for its eventual redevelopment.

The quango also owns the 239-acre Capitol Park business and industrial estate, near Goole.

Shadow Business Secretary John Denham has branded the Government's move – blamed on the need to tackle the deficit – as "outrageous".

Mr Denham said: "This is 'Whitehall knows best' centralism at its finest."

A spokesman for the Department For Business, Innovation And Skills said: "The Government has confirmed to the RDAs that it will not be appropriate for RDAs to transfer assets to local authorities or other bodies on a deferred consideration basis.

"It was concluded, however, that within the constraints imposed by the current fiscal climate, it is not feasible for local authorities to delay payment for RDA assets.

"However, local authorities are able to purchase assets at the market value and other options to allow local authorities to be involved with RDA assets in future are being considered."

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