Wales politics

Circuit of Wales: Jones misled public says Plaid Cymru AM

Circuit of Wales
Image caption Plans for a racetrack at Ebbw Vale have received £9m in public money

An inquiry is needed into the rejection of the original Circuit of Wales plans last year, Plaid Cymru has said.

First Minister Carwyn Jones said then it was because a proposed government-backed guarantee for the racetrack in Blaenau Gwent rose from £30m to the entire project cost of £357m in days.

But an email from main private backers Aviva said there were negotiations for months on a deal for a 100% guarantee.

Plaid's claim that Mr Jones misled the public has been denied by ministers.

On Tuesday, the Welsh Government refused to back a new version of plans for a motor racing track and leisure project in Ebbw Vale, calling it too risky and saying claims of up to 6,000 new jobs were "overstated".

On Thursday, ministers said the proposed full guarantee emerged from a "range of funding options" that were discussed.

On 6 April 2016, the then economy secretary Edwina Hart said the Welsh Government could not underwrite the entirety of the £357m cost saying there was a "significant question around the viability of the project" and an "unacceptable risk" to the Welsh Government.

Image caption The circuit itself would have created only around 100 jobs, Carwyn Jones said on Tuesday

In a BBC Wales interview the next day Mr Jones said: "The model that was put forward was not going to work.

"What happened originally was they were looking for a guarantee of £30m from us, it then went to £357m.

"That is far too much, no government is going to agree to that without of course looking at the model in more detail."

When asked when the development occurred, he said: "In the last few days."

An email obtained by Plaid Cymru from a senior manager of Aviva Investors, Mark Wells, to the founder of the Circuit of Wales project Michael Carrick later in the year, but referring to April, said: "At that stage, the manner in which the deal was rejected did not reflect well on Aviva Investors.

"Especially as it quoted that we requested a 100% underwrite a few days before the rejection, when in fact this deal had been worked up with the Welsh Government (through civil servants) for many months and nothing in our funding structure changed in the run up to this announcement."

Image caption Adam Price says Welsh ministers made a series of inaccurate or misleading statements

Plaid Cymru economy spokesman Adam Price said the Welsh Government claim the proposed guarantee had increased so sharply in a few days was a "false assertion".

"Sadly this project has been characterised by a series of inaccurate and misleading statements made by the government, ostensibly to justify its own position in the face of potential criticism," he said.

Accusing Mr Jones personally of misleading the public, Mr Price added: "As things currently stand no-one - business, media, parliament or public - can be confident our government is being straight with us.

"Only a full independent inquiry can begin to rebuild public trust."

The Welsh Government said in a statement: "As we have already made clear Welsh Government officials have worked with the developers throughout this process to try to make the Circuit of Wales project work for Wales.

"Between August 2015 and March 2016 a range of funding options for the Circuit of Wales project were being explored between the developers, local authorities and Welsh Government officials.

"Following those exploratory discussions, what eventually emerged was a proposal from the developers that required a £357m Welsh Government guarantee.

"Once formal advice on that proposal was given to the former economy minister, she made the decision that it did not reflect value for money for the tax payer and was not state aid compliant."

Speaking to BBC Radio Wales' Wales at Work on Thursday, the chief executive of Circuit of Wales, Martin Whitaker, said it was "a shame" he had only met with Economy Secretary Ken Skates once in the past 12 months and added: "I think that's maybe the biggest problem that we have.

"I think if we'd had the chance to discuss this face to face with him we wouldn't be in the situation we're in today."

And he insisted they were still "ready to go" and "shovel-ready".

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