Bath spa project compensation figure revealed at last

The total figure for the compensation paid over the Bath Spa fiasco is just short of £7 million, the Bath Chronicle can reveal.

The building firm and architect which did most of the work on the much-delayed £45 million project both agreed to settle out of court with Bath and North East Somerset Council last year.

But the payment to compensate the authority for the delays and extra costs of the controversial scheme was subject to a confidentiality agreement, with the figures emerging only in official accounts.

The council’s accounts for the 2008/09 financial year showed a £4.177 million compensation payment.

Now the authority has issued its statement of accounts for the 2009/10 year, which shows an additional payment of £2.785 million - making the total £6.962 million.

The compensation has been paid by builder Carillion and architect Nicholas Grimshaw and Partners.

The authority had sued Carillion for £21.366 million after a formal claim for £2.382 million from the contractor which had been removed from the project ahead of the building’s opening in 2006.

That was five years after its original scheduled opening date, with the final cost more than three times the initial budget.

The council had set aside £6 million in a reserve fund for the cost of a court case which had been due to start at the start of this year.

The compensation payments have freed up this money to allow the Tory cabinet running B&NES to put one-off cash injections into road maintenance and affordable housing work.

Carillion’s predecessor Mowlem had originally made claims of around £10 million but this sum had been reduced through what council chiefs call “constructive discussion and negotiation.”

The council reached an out-of-court settlement with the two firms last November with all parties keen to avoid the huge costs of a formal case before a judge.

Council deputy leader Councillor Malcolm Hanney said: “The council believes it was fully justified in defending the claims made by Carillion, and counterclaiming against Carillion and NGP. The settlement amounts received exceed the costs of so doing.”

The council has stressed that the extra money freed up by the settlement has been spent on what are called non-recurring items - and not to plug temporary budget gaps.

The council has significantly increased spending on road maintenance work in the current financial year, to £6.5 million.