Northumberland council faces '£5.5m claim' over virus-halted work

The council's chief executive, Daljit Lally, is currently on extended leave

The temporary shutdown of a building project during the Covid-19 pandemic has led to a multi-million pound claim against a council-owned company.

Work on a £30m energy park in Blyth was mostly halted in late March by Advance Northumberland, a regeneration company owned by the Conservative-led council.

It has emerged that site contractor Farrans has launched a claim for losses, thought to be worth £5.5m.

Advance said the decision to close was taken to ensure the safety of staff.

It added that as well as stopping work over concerns about social distancing difficulties, there were also supply chain problems and staffing issues.

'Taken legal advice'

In evidence seen by the BBC, Northumberland County Council Chief Executive Daljit Lally - who has been put on "extended leave" - said she was not consulted and that Advance's managing director Ken Dunbar may have exceeded his authority and had not properly assessed the implications of halting construction.

Mrs Lally also said the Government had not ordered work to cease on construction sites at that point.

Mr Dunbar said he did have the authority to order the shutdown, had taken legal advice, assessed potential implications and worked with the council.

"Ultimately I, fully backed by a board of independent directors and directors who are also councillors, took the decision it was important we looked after the safety and welfare of the staff and closed sites down safely," he said.

He would not be drawn on the amount Farrans was claiming against Advance while negotiations were ongoing.

'Pressures from Covid-19'

Work has resumed at the Northumberland Energy Park site.

"The ultimate goal is that we will have a project that will attract hundreds of millions of pounds of investment and hundreds of jobs," he added.

No party has overall political control of the council but it is run by the Conservatives which has the largest number of councillors.

Councillor Susan Dungworth, Labour group leader, said: "We've been potentially handed a liability of £5.5m when like other local authorities up and down the country we're facing pressures from Covid."

Northumberland County Council said the issue was a "commercially sensitive matter" between a contractor and Advance.

Farrans has not responded to requests for comment.