Taxpayers must pick up £475k tab over demolition of Scunthorpe pub
TAXPAYERS face a bill of £475,000 to demolish a pub in Scunthorpe town centre.
The news follows the earlier part-demolition of The Foundry Arms, which North Lincolnshire Council says it was forced to carry out when it flattened the adjoining Carlton Street car park.
Licensees Chris and Andrew Mappouras had reopened the pub, previously known as The New Venue, in July 2011 after investing £250,000.
However, just weeks later they were told by the council to close amid fears the car park might collapse. The car park has since been demolished at a cost of £787,000.
Now the pub will be flattened – bringing to an end a legal wrangle that has rumbled on since the demolition work began.
North Lincolnshire Council has agreed in principle to pay £425,000 to take on sole ownership of the site, with a further bill to the taxpayer of £50,000 to demolish the remainder of the pub.
The £425,000 will be handed to Scanlans Consultant Surveyors LLP, based in Leeds, which has acted as agents for those who had been the registered owners of the site.
It is understood some of this money will then be passed on to Chris and Andrew Mappouras.
The overall bill will be funded by council contingency funds.
Scanlans confirmed to the Telegraph that the basis for a conditional agreement had been signed.
A confidential report prepared by North Lincolnshire Council and seen by the Telegraph says "it unfortunately proved impossible to demolish the multi-storey car park without causing significant collateral damage to the Foundry Arms.
"As a result, it became necessary to effect the demolition of a substantial part of the Foundry Arms building."
The council says this was due to the "restricted method of demolition allowed by the Health and Safety Executive".
A spokesman for North Lincolnshire Council said: "North Lincolnshire Council was forced to demolish the car park following safety concerns and this decision has also compromised a number of neighbouring buildings.
"The multi-storey car park was found to have serious structural faults and be in danger of collapse and no other decision other than immediate demolition was possible to protect public safety.
"Protection of an electrical substation added to the critical nature of the challenge and the need to secure a prompt resolution to ensure continued supply to homes and businesses.
"The council is committed to the regeneration of the Market Square and Church Square areas of Scunthorpe and has allocated funding to create local jobs and provide new homes and improve and create a town centre that residents can be proud of."
The report states that the cost of rebuilding the pub would have left the authority facing a bill in the region of £529,000.
The report goes on to say that legal advice "indicates the council is liable for making good the damage caused to a standard equivalent to that immediately prior to demolition.
"This requires the rebuilding of The Foundry Arms and replacement of all lost equipment.
"This is not covered by the council's insurance arrangements."
The council report concedes the £475,000 deal is "the best option".
The report states: "It resolves all current and any potential outstanding liabilities that the council has in relation to The Foundry Arms at a significantly lower cost than fulfilling our obligation to rebuild the facility."
The authority also hopes demolishing the site will help restore the area.
The report adds: "It provides the opportunity of the return of a key town centre site", which it says will contribute "to our future ambitions for regeneration of the area."
But the report also reveals the complex ownership arrangements of the site.
The report, written prior to the agreement, states: "The tenancy of the Foundry Arms is complex. A ground lease is in place between the council and third party tenants.
"This originally dates from 1977 and expires in 2072.
"This currently yields an annual income of £4,500 to the council, although this is temporarily suspended at present."
The Mappouras family have so far declined to comment.