Council ordered to repay £150,000 in European funding

A High Court judge in London agreed with the Government’s stance that the council had breached EU requirements by failing to open up the tender process to contractors on the continent ahead of granting contracts to A&S Enterprises.

As a result, Mr Justice Foskett backed the decision of the Secretary of State for Communities and Local Government to “claw back” 25 per cent of the total funding granted by the European Regional Development Fund for the two related projects as part of the Station Gateway Public Realm Improvement Works.

Mansfield District Council had challenged the decision that it must pay back £138,317 and £20,262 in respect of the two contracts.

But the judge, rejecting its case, found that the authority had failed to consider potential “cross border” interest in the tendering process.

Rather than properly advertising the contracts, he said that it had relied on an existing list of approved contractors from which it drew up a final tender list of eight. Six competed for the project, and A&S was selected.

The judge said: “No evidence of any assessment by the claimant of potential cross-border interest in the project has been proffered at any stage and none exists.”

He acknowledged that it was possible to see why a conclusion might have been reached that there would be no such interest in respect of relatively small projects which the Council said are “in a remote part of North Nottinghamshire”. But he found that the ERDF National Procurement Requirements demand that local authorities carry out a “conscious process” conscientiously.

The council’s failure to do so, he said, constituted a “breach of the EU procurement requirements”.

He found there were no grounds on which he could interfere with the amount of the claw back, which the council had branded disproportionate.

Coun Kate Allsop, Mansfield District Council’s portfolio holder for economic regeneration, said: “The council follows rigorous procedures to ensure that funding regulations are adhered to and consulted the funders throughout this project.

“We are disappointed with the outcome and are considering appealing the decision.

“There was never any intention to not comply with the procurement process and this was acknowledged by Mr Justice Foskett.”