Friday 13 October 2017

Swansea City Deal and the Wellness Village...the dream unravels?

This week's Carmarthenshire and Llanelli Heralds feature detailed reports on the troubled Swansea Bay City Deal, as well as a scathing Cadno opinion piece (see below). As we know this all ties in with the luxury spa Wellness Village planned for the Delta Lakes Swamp in Llanelli. Listening to Carmarthenshire Council, and more particularly the City Deal lead chief executive, our very own Mark James, it's all wonderful, so wonderful in fact that neither he, nor Emlyn Dole, could be bothered to personally answer the questions posed by the newspaper.
The Herald reports that Carmarthenshire Councillors will be briefed at a meeting next week as to the progress of the City Deal - it is very likely that this will be another PR stunt like the 'presentation' back in February.

I have given my views on the Wellness thing in previous posts and reported Pembrokeshire's doubts over the City Deal last month.
Last week it was the turn of Neath Port Talbot. Their chief executive provided a damning report on the City Deal and expressed serious doubts about the level of public funding required and seemingly insurmountable governance issues.
Just in case our own chief executive doesn't furnish councillors with a similarly honest report next week, here's a link to the document - I urge them all to read it.

To summarise just a couple of points, at least six months of time, and copious amounts of external legal advice have been used to try and formulate a governance model for the 'Joint Working Agreement' to oversee the City Deal projects. The conclusion is that the 70 page draft is not fit for purpose and they'll will need to start from scratch.

Some may remember Sian Caiach being shot down by the chief executive when she asked how liable the council would be for covering interest payments on the millions of pounds worth of loans the council would be required to take out. Mr James snarled back saying it would all be covered as the government was allowing the councils to keep some of the business rates from the proposed developments.

The NPT report reveals that the government has made no such firm commitment and the four councils will, in all probability, have to stump up all the costs (£386m) without any idea if they'll get any of it back. Carmarthenshire council already has a debt of £386m costing £18m a year in interest.

Furthermore the strangely PR obsessed ARCH (A Regional Collaboration for Health) programme, essentially made up from the health boards, and a major player in the Wellness thing, was refused Welsh Government funding before the City Deal was even signed. NPT has said it will definitely not plug any funding gaps. The health boards themselves haven't got the cash to splash either.

As for the promised millions from private investors, there's little evidence of anything concrete and if there is, the governance issues around public/private partnerships are an equally tricky problem - there are plenty of costly PFI failures to draw on.

Reading between the lines it appears that the language used behind closed doors has been somewhat stronger than that outlined in the report. Rowing chief executives perhaps, and with Mr James in the lead role...well, taxpayers' money, governance issues...what could possibly go wrong? After what has been revealed to me through several years of litigation with Mr James I would question whether they've got the right chief executive in the 'lead role' at all.

This blog is primarily concerned with Carmarthenshire. The Yr Egin cultural centre which involves Trinity St David University has already gone ahead and is currently at the large empty shell stage, What this has cost the council remains unknown although as Mr James, (with his many declared and undeclared hats), is also a Director of the University, he could probably tell us.

As soon as the Wellness concept came to light alarm bells were ringing. A bit of research uncovered the fact that this is all about luxury health tourism and private health care; a concept put forward by a privately run US based organisation, the Global Wellness Institute. Then, last year, after the costs escalated, the council by-passed usual procedures to enter an 'exclusivity deal' with a private company, Kent Neuorosciences Ltd to manage the project (see also here). It's not clear if they're still on board or whether the council are committed to a contract which may never materialise. The promise of a leisure centre and care home for Llanelli has, in the words of Cadno, 'metastasised' into something else entirely.

We also know, through Freedom of Information, that the council and the Welsh Government have already spent £1.3m on the project, roughly half each, without, it appears, a clear idea whether it will even go ahead.

The total cost of the project is around £230m with just £40m coming from the City Deal. Back in January the council hoped that £127m would come from private finance. As the Herald states, 'the Council is becoming involved in what increasingly appears to be a speculative commercial venture' and dependent on a 'high level of private finance in a time of considerable economic uncertainty'. The Herald asked the council ‘how much private sector finance has been obtained to date?’ Their unwillingness to provide a specific response suggests not very much, if anything.

So, whilst the chief executive of NPT says it how it is, our councillors are kept in the dark, and always have been. Have any of them read the report? You would think its revelations might have prompted a question or two at next week's full council meeting. Instead, the leader of the opposition Cllr Edmunds (Lab), claiming to be concerned about the lack of openness and transparency has suggested a tweak to the constitution to try and get straight answers to councillors' questions.

It could possibly have been triggered by a question at the last council meeting when Cllr Madge (Lab) asked Cllr Dole if Ammanford Town Hall was now safe after the misleadingly titled 'Agile Working Plan' report had been withdrawn from a earlier Exec Board Meeting. The 'Plan' suggested that, amongst other buildings, the Town Hall would be sold off.

Instead of just saying that he couldn't give any reassurance, which would have been an honest answer, Cllr Dole decided to go on the attack and say the report hadn't been discussed so the question was 'mythological'. The report, despite being deferred had actually been through various stages of senior management approval and, although the plans to sell the buildings might be shelved, he couldn't guarantee they were safe. And despite being deferred, the report had been published on the agenda for all the world, and the staff employed at the Town Hall, to see. (update; a revised report has been published today, the 16th, and the Town Hall has been removed from the list but Parc Amanwy is for the chop instead)

It works both ways of course and Cllr Madge was equally evasive whenever he was put on the spot as leader. The day that a politician, from a prime minister to a mediocre county councillor, gives a straight answer to a mildly probing question, will be a moment to remember and unlikely to be achieved by tweaking the constitution. That said, it wouldn't hurt.
Mind you, it would be far better if Cllr Edmunds focused his concerns on removing this from the constitution.

I am digressing though, the point being that our councillors need open their eyes to the big wide world and in particular to the potential lasting drain on the taxpayer of County Hall vanity projects. Take the blinkers off. Lessons should have been learned, and the common denominator is Mr James himself. Remember the independent accountants warning against investing in the Parc Y Scarlets' stadium? It's drained the taxpayer ever since. If we go further back the people of Boston were stuck with a massive bill and an audit investigation thanks to another of Mr James' vanity projects which proved far more costly than predicted.

The taxpayer was equally shortchanged over the notorious car park deal a couple of years ago, thanks to Mr James' last minute intervention, it was nothing short of a generous bung. His own actions regarding the pension tax avoidance scam, let alone the illegal libel indemnity shows a senior public official who has less regard for the public purse than his own precious wallet.

We have yet to see how his interests in the residential letting element of the Wellness village squares with his own property interests in Cardiff Bay...

I have been following, as best I can, the various organisations involved in the Wellness thing, as well as the City Deal and there has been virtually nothing in the way of public information, from Minutes of meetings to risk reports, it's all been public relations nonsense. Emlyn Dole, our Council leader has swallowed the lot, hook line and sinker.

Mr James has committed the council to the Wellness vision, it will become one of those visions which cannot fail, no matter what; it is not just his councils' reputation which is at stake but his own. Which, in the world of Mr James, is all that matters. When councillors attend the briefing next week they should remember this, and before they commit millions (a possible £150m..or more?) to a flawed vanity project, plug any funding gaps, and leave a costly legacy for auditors to clear up, they should demand some straight answers, and they should never, ever, assume that they're being told the truth.

18th October; For Cneifiwr's analysis, see his latest post; Mark leads us to the promised land


Cadno and the Road to Wellness
Reproduced with permission from the Herald

There is a short speech in Macbeth which has always resonated with Cadno as an example of how poor decision-making can lead to worse actions.
I am in blood
Stepped in so far that, should I wade no more,
Returning were as tedious as go o'er.
Strange things I have in head, that will to hand,
Which must be acted ere they may be scanned.

Macbeth has committed himself to a course of action which he feels he cannot back out of and has plans to carry out which he must do before he has a chance to think about them.
Next week, councillors in Carmarthenshire will receive a briefing on exactly how much the Council will be ponying up towards a project, the artist’s impression of which was described elsewhere as resembling ‘a herd of white elephants gathered around a stagnant pond’. 
Yes, readers!
It’s the all-singing, all-dancing wellness thingy – the flagship project of what now appears to have changed from being a regional deal to a city deal. 
Way back in the 1990s, there was a minor American comedy drama called The Road to Wellville, which starred Anthony Hopkins as Dr John Harvey Kellogg, whose surname adorns many cereal boxes.
At Dr Kellogg’s sanatorium, his unusual methods for maintaining health include colonic irrigation, electrical stimulus, sexual abstinence, vegetarianism and physical exercise.
His wealth has given him the scope to indulge his theories and impose them on those seeking the sanatorium’s services in order to achieve wellness.
In one memorable scene, Kellogg describes one benefit of his vegetarian diet as his production of stools that have no more aroma than a freshly-baked biscuit. 
What joy it must have been to be alive in those days, readers, when all one needed to get into Wellville was ready cash and a fond belief in the unlikely efficacy of crackpot ideas. 
The Road to Wellness, starring that Savonarola of Gaol Hill Mark James CBE, is a slight variant on the notion. Using a combination of Council Taxpayers’ money, loans, and private sector funding, Mr James will be trying to persuade county councillors to get out the civic chequebook and start writing out cheques for sums involving large eight-figure sums.
After all, the argument will go, ‘we are stepped in blood so far…’ 
As The Herald reveals elsewhere in this newspaper, the Council has zero involvement in the Life Science and Educational aspects of the development. That funding is coming from the City (Region) Deal, whose local authority lead executive is none other than our own Dr Kellogg-Macbeth.
The amount of funding committed to the bits of Wellness the Council is actually attached to is – in round terms – a big fat nought. 
£150m is the headline figure for the oh so exciting speculative investment the Council is planning to be part of – which includes such exciting developments as a ‘Wellness Hotel’ and a retirement village for wealthy gentle-folk who fancy teeing off at Machynys Golf Club, just across the road, and having spa treatments administered by ever-so grateful locals working for minimum wage.
Who knows? They may even get round to actually building the leisure centre from which this whole project has spawned – or, more precisely, metastasized. £150m is the cost of this venture into property development, and the only other funding shown as coming on board is private sector funding.
Cadno has no doubt that next week there will be a series of equivocations, weasel-words, and showy graphics in order to deflect councillors from the hard truth that the local authority will be mortgaging the Council’s future at a time that cuts in public services are really biting hard. 
And all the while the clinching argument will be ‘we are stepped in blood so far’. 
The Council has chucked seven figures of public money at this project, so far. Officers and those members of the Executive Board who want to leave a legacy – one of the Seven Wonders of Wales, perhaps, should perhaps remember that a collection of tombs and derelict and apparently purposeless stonework is not the model to which the Council should be working. 
The whole concept is flawed from top to bottom. 
It is so dependent on a series of serendipitous events underwritten by hubris and a disregard for public money and cost that the plan – as mooted at this stage – is less a strategy than a recipe for disaster. 
Councillors would do well to consider, before they are bounced into handing over the money, the track record of the Council’s involvement in major developments. For some reason, the words ‘Parc y Scarlets’ and ‘fiasco’ come sprinting into view. Never in the history of Carmarthenshire has so much been squandered for so little return and at such a loss. The Council will never get repaid and may as well write off the money for that one. 
Of course, lenders who will be bankrolling the Council’s collective vanity will not write off the money ploughed into the swamp at Delta Lakes. They will want repaying. 
Moreover, private sector investors will want something more than a sales pitch which revolves around a rehash of ‘never mind the quality, feel the width’. And you might well wonder why the Council would want to plough public money into a project the fat end of which will end up in private sector hands. 
Forget the research – the Council will have naff all to do with any kudos attached to that as it will not be involved with it other than as landlord. What the Council is involved in is nothing more than a piece of property speculation involving huge sums of public money to private benefit. 
Put it another way: in Cadno’s kitchen cupboard is a collection of handy china containers of varying sizes from which he likes to drink his tea. A councillor believing that the Road to Wellness will end in anything other than a huge cost speculation for little benefit – maybe the Council will remember to build a leisure centre, though – is welcome to join the other mugs in Cadno’s cupboards. 
And all the while, the siren song shall be: ‘we are stepped in blood so far’.
Either that or, even worse, there will be an appeal to councillors’ vanity, inviting them to magnify their own to match that of those behind the whole scheme and a request that they act without thought or proper scrutiny.
It’s not only the Road to Wellness which is paved with good intentions.


Sian Caiach said...

Thank you Jacqui for this update. As you know I was the only councillor on Carms CC at the time that voted against this project. It seemed bonkers then and I'm pleased to see that at least one of the partners is looking at the project objectively.

We will never have economic regeneration in Carmarthenshire if we continue in this line. What always seems to happen with these projects is:

Someone has had an idea for grabbing grants and/or permission to borrow.{ Not only a begging bowl economy but not even great ideas of what to beg for.}

The project is "developed" to do this and involves a list of usual suspects or partners as they are called, both public and private.

Often the motivation and/or reliability of the partners is suspect and the project is not fleshed out with planning and infrastructure details. Neither is a convincing business plan.

A glossy presentation, nice building{s}, beautiful scenery, flyover CGI etc. Always works.

Absolutely no analysis of any possible problems or downside.


I despair. Were my colleagues gullible or just so desperate for anything to change?
What was the evidence that is was financially viable? The Wellness Village was, Meryl Gravell assured us, bound to be used by local well off people in the vicinity and would produce up to 400 jobs, some for the people of South Llanelli in roles such as carers and security guards. No figures, no research, no examples of success elsewhere. So no actual reason to put a private health care tourist facility into Llanelli.

And the sums? It was eventually revealed that Emlyn Dole had signed the Deal without an analysis of the financial commitment it entailed. It could have been a very expensive photo call with Theresa May.

A private healthcare facility/research hub would be unlikely to recruit skilled staff locally and even if it did could seriously effect the local NHS. Mrs Gravell told us she had a friend who worked for a profitable genetics company whose company might be interested. The phrase "several expressions of interest" was mentioned in passing.

Another problem of this project is the high reliance of the funding on borrowing which is supposed to be largely covered by later private investment. There was absolutely no sign of anything which would be attractive to an investor, What were the returns? How safe was their money. What were the odds of success in a project so lacking in detail?

The individuals who got us into this mess will bear no liability for the repayment of the loans. The council tax payer and even the Welsh Government may have to do so.

The decision to throw money into this project was made by all of the County Councillors present {bar me} and few if any will still be in post in 20 years time if it is built, and the financial results become clear. Beguiled by the promise of jobs they did not examine the details. The money has to be borrowed up front. Then it will be hype and promises with the public to take any losses.

On one of the american news channels I've just seen a glossy TV Advert for a Wellness Centre in a far eastern country where apparently you can have your private medical procedures done by cheerful, attractive and highly skilled people as well as convalescing on the adjacent attractive tropical beach.Also hinting all this is at a fraction of the price you would pay in the West. Could Delta Lakes compete?

Anonymous said...

Will the dream come true, or will it end up as a nightmare ?

To play safe maybe they should name it the Elm Street Clinic.

Anonymous said...

This just another way of getting taxpayers to pay for high end private sector projects which only provide minimum wage part time jobs - when the money should be going for community facilities and services

Why is it that two CEO in the regional are querying the governance of the initiative and our own leader - that is James not Dole are hell bent on going forward even appointing a £149k Director of Regeneration to carry out these projects

With James' track record of projects why are we the taxpayers allowing him to stay in post

Where are the Plaid Cymru Councillors

The Council should stick to rubbish collection and providing care for the elderly and not playing banker to private companies

Anonymous said...

I am staggered at the cavalier attitude this council, and in particular the lunatic employed by the asylum to provide advice, displays towards tax payers money. Councillors glibly accepting the word of those with vested interests (read james and gravel) knowing full well the history of this incestuous duo when it comes to money and vanity projects should be ashamed of themselves. Everyone knows the inherent dangers related to any of the schemes introduced by these clowns and if either of them told me it was a pleasant day I would have to check outside to confirm daylight before responding. Councillors need to and should have been doing so since this cancer descended into Carmarthenshire.

It is also of interest to note that gravel is now on the payroll of the delta lakes scheme, apparently £50k per annum for 2 days per week. Nice work if you can get it. But my point is that with james hell bent on pursuing this folly at any cost we have to wonder what his motives are. Well, if it looks like a duck, walks like a duck then it will likely paddle on the lakes...

All the councillors have email addresses published on the council website and I would urge you to submit all the documents you feel appropriate and relevant prior to this forthcoming meeting with a covering message highlighting their responsibilities to US, the people they represent and take decisions on our behalf, bringing their attention to the disaster that will unfold if they allow this vanity project approval.

At least then, if it all goes to hell in a hand cart, as it likely will, they cannot claim not to have been aware of the consequences.

Martin Milan said...

If the council wants to encourage employers into the area then it should invest in the creation of a skilled workforce through education - instead of cutting it to the bone...

Elderly Neil. said...

These vanity projects from Boston Lincs to Parc Y Scarlets and now the Wellness Centre
are all completed by developers unknown locally.
These companies not engaged in public works are ever ready to take on harebrained schemes similar to the above vanities.
Undoubtedly completed accounts do not show the sweeteners surely paid in the way of rewards to those who are so up to their necks in dreaming up such lunacies.

Anonymous said...

Sweeteners are factored in to tenders as a matter of course - usually 5% - disguised as something else, naturally.