Tuesday 17 December 2013

Carmarthenshire Council, State Aid and the Scarlets - the BBC investigates

Update 18th Dec; The Western Mail reports today that Cllr Caiach has made a formal complaint to the European Commission that up to £20m allegedly channelled from Carmarthenshire Council to the rugby club in recent years amounts to unlawful state aid.
The council statement, which again attempts to completely gloss over the peculiar split over the car park proceeds, contains one of their most deluded sentence of the week, "We have not given the club any money". Words fail.


One long running argument concerning the Council's financial commitment to the Scarlets Regional Ltd, the rugby club, has been whether they have breached EU State Aid rules. The rules are complex but basically restrict and limit the use of public money to prevent private companies gaining an unfair advantage in the marketplace.

Followers of this blog will be aware that Cllr Sian Caiach has raised this issue numerous times (see for example 'State Aid and the Stadium') and the council have consistently relied on a legal opinion from 2007 which apparently said that they were exempt from State Aid Rules.

Cllr Caiach's requests to see this document have been consistently refused by the council.  

BBC Wales have now carried out their own investigation and have sought the opinion of a European funding expert. He believes that State Aid rules were 'likely to apply' and 'should have been followed'.

The article also mentions the sale of the car park to Marston's, recently the subject of concern over those peculiar 'Allowable expenses?' and the subsequent grant of further financial relief by the council's Executive Board in October. I understand that the 'Marston's deal' is now the subject of a complaint to the Wales Audit Office.

There is nothing wrong of course in a local authority supporting its favourite rugby team, but it is the degree and manner of subsidy which has created so much concern against a backdrop of severe cuts to frontline services

Interestingly, the funding expert also says that "If a breach is found to exist then the European Commission can force the awarding body, in this case Carmarthenshire council, to recover the amount that's in breach of state aid regulations from the recipient"  Surely that would be welcome news for cash-strapped County Hall...wouldn't it?

The BBC article can be read here; Llanelli Scarlets £20m aid by council concerns raised

No comments: