Redcar council returns £1m to EU over empty office space
More than £1m has been returned to the European Union (EU) after Redcar and Cleveland council failed to fill office units in a new development.
The council received the EU grant for the £31m Redcar Leisure and Community Heart project.
But it has now had to refund £1,030,000 after it failed to meet all the EU Development Fund criteria.
Cabinet member for housing Tristan Learoyd said taxpayers may have to foot the shortfall.
He told BBC Tees: "As part of the [EU] deal it was specified that a number of office spaces had to be filled.
"The reality is no office space was being taken up and there is empty floor space for everybody to see.
"It works out as £10 per head across the borough, it will be paid out of the central grant so that means services will have to be cut back as a result or there will be future tax rises.
"This year the books have been balanced but moving forward, because of the catastrophic decisions made in the past, wasting money at a time when they were having to cut back, there is a likelihood of future tax increases because of these mistakes."