Calls to renegotiate Brighton i360 debt repayment deal
Bosses say the seafront attraction is nowhere near meeting its financial obligations
Last updated 1st Oct 2024
Brighton and Hove City Council aims to renegotiate the i360 loan repayment schedule because the seafront attraction cannot meet its current obligations.
Finance chief Nigel Manvell said that the i360 was not performing well enough even to meet a reduced level of repayments.
The council brokered the original £36 million loan from the government-run Public Works Loan Board and pays £2.2 million a year including interest. The i360 repayments have fallen short.
At a meeting last week, Conservative councillor Anne Meadows asked about the “expected credit loss” – up from £14.8 million to £26.5 million. Mr Manvell said that the outstanding i360 loan repayments were being treated as a “bad debt”.
He told the council’s Audit, Standards and General Purposes Committee that the original repayment schedule included a “commercial mark-up” but the council was not receiving this.
Mr Manvell said: “For the council, the real position is the underlying Public Works Loan Board loan which does not include the commercial mark up.
“And the council has something called a minimum revenue provision to meet the repayment of the Public Works Loan Board loan so the council is not in default.
“That cost is £2.2 million per year. The council has already approved that it will meet £1.2 million of that and the i360 is expected to pay the other million.
“That repayment is also potentially affected by the i360 performance and that is currently being reviewed as to the likelihood of them being able to make those payments in future.
“That’s something that is being discussed with the i360 at the moment.”
The i360’s outstanding debt to the council currently stands at £46.981 million.
Last year, it was due to hand over almost £1.5 million, with repayments scheduled for June and December. It paid just £250,000 in June 2023. No payments have been made since then.
In all, the i360 has paid £5.8 million over the past 10 years when it had been due to stump up about £20 million.
Since the meeting, Labour council leader Bella Sankey has spoken out about the situation. She said: “At a time when the council is experiencing significant financial pressures on our services, it’s incredibly frustrating we are still not receiving regular payments from the Brighton i360.
“This is contributing to the council’s budget shortfall and the need to make even more savings.
“Each missed repayment is money which could have been spent on vital local services.
“We are actively considering our next steps in terms of recouping taxpayer funds as far as possible.”