Laura Sharman 18 July 2018

Council threw £40m 'down the drain' in flawed Stadium investment

Council threw £40m 'down the drain' in flawed Stadium investment

An independent review has criticised Newham Council for investing £40m into the London Stadium, warning the decision was ‘flawed’.

The investment, made by the council’s previous administration, saw Newham invest the money despite the deal not achieving a financial return of £3m per year, one of the council’s own conditions for investment.

Mayor of Newham, Rokhsana Fiaz, has already promised more accountability and scrutiny in future decision-making.

Mayor Fiaz said: ‘The view we can draw from this report is this was ultimately £40m down the drain. For me, the report helpfully tells us that concerns raised by financial advisors at the time – namely that a £3m return on a £40 m investment was not achievable – were ignored.

‘The vision for the stadium and the benefits it could provide was exciting, but the investment by Newham in 2013 was significantly flawed because not enough attention was paid to the detail when the final decision was made.

The QC’s report found councillors and officers often did not have enough time to properly read and understand highly complicated reports related to the decision. It also found decisions were made behind closed doors and delegated to senior officers.

 
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