A £45k budget overspend was noted in Council accounts for when the traders in the Peoples Market were moved out in January, however it appears the figure is really ‘just’ an extra £5k.
In an article on Friday we referenced two queries lodged with Wrexham Council in the middle of last month over the underspend in their budget, one regarding a possible £25m investment over the next five years , and the other regarding a £45k cost incurred when the traders in the Peoples Market were moved out in January.
Although the question over the £25m spend is ‘in hand’ and as yet unanswered, we did get the following a few hours later over the Peoples Market query.
The budget documents referenced: “A further overspend of £45k was incurred in the markets budget as a result of the loss of rental income due to concessions granted and following the decision to move traders from the Peoples Market in January 2017.”
We asked for a comment on the apparent unforeseen cost, and if it effectively would be charged to the project or absorbed by WCBC. We also asked when the decision to go ahead with the decision to move traders was that figure, or a projected cost available to Councillors Hugh Jones and then Councillor Neil Rogers at the time to help inform them.
Cllr Terry Evans, Lead Member for Regeneration and Economic Development, said: “The overspend cited within the report was absorbed within the Cash Limited Budget for the Housing and Economy Department.
“A report put to the Employment, Business, Investment and Scrutiny Committee in March 2016 outlined concessions open to traders from September 2015 until March 2016, with a 40 per cent reduction on their rent. This was open to all traders not in arrears, and resulted in a decline in income of £15,301 for the 2015/16 financial year.
“At the same meeting, it was proposed that the concessionary arrangement continue for a further nine months until the end of December, 2016. It was noted that this would result in a total reduction of rental income of £19,672. Further reductions in 2017, to help tenants during the construction stage at the OW Peoples Market project, were also proposed.
“It was estimated that this would result in a total reduction of more than £40,000.”
At the time we noted comments from then Councillor Neil Rogers, with questions regarding compensation for traders who wish to leave the market during the reconstruction raised in the meeting, however Cllr Rogers noted that he was ‘not prepared to discuss compensation’ during the meeting.
The report to the March 2016 meeting states: “In addition to the decline in income, it was agreed that for the period from September, 2015 to March, 2016 the permanent traders in the People’s market would receive a 40% reduction on their rent (not service charge). This was applicable to all traders that were not in arrears and has resulted in a reduction of rental income of £15,301 for the 2015/16 financial year. 4.7 Discussions relating to rental concessions are ongoing with elected representatives of the Traders in the People’s Markets.
“It is proposed that this arrangement continues for a further 9 months until the end of December, 2016, resulting in an estimated total reduction in rental income of £19,672. A further reduction in 2017 is proposed to support the tenants during the construction stage.”
“A reduction of 100% of rent (not service charge) for the six month period January to June, 2017 followed by a 25% reduction for the remaining six month period to end of December, 2017, (when traders will be in their newly refurbished permanent base) is considered appropriate during this most disruptive period. This will result in an overall estimated reduction in rental income of £40,984 for this period.”
The above would indicate a budgeted rent (not service charge) reduction through to the end of 2016.
This morning we have double checked with Wrexham Council if the ‘further overspend of £45k’ was on top of the already planned £40k cost, or if it was part of that already calculated figure.
Wrexham Council have told us the overspend, and presumably therefore the extra cost of the u-turn to move traders out, was an extra £5k .