Decision details

The Auditor General for Wales’ report on The Welsh Government’s acquisition and action to dispose of the former River Lodge Hotel, Llangollen was published in June 2012.  The report concluded that the Welsh Government's decisions- in 2007 to buy the former River Lodge Hotel for £1.6 million and in 2009 to enter into a lease agreement with an organisation known as Powys Fadog- were flawed and did not represent good value for money. In light of this, and the increasing likelihood that Powys Fadog would be unable to fulfil the conditions of the lease agreement, the report considered that the Welsh Government’s decision in 2010 to carry out an appraisal of options for the disposal of the property was both prudent and necessary. The report also found that the Welsh Government had been slow to react to external and internal concerns about the probity and value for money of its earlier decisions.

The Auditor General for Wales’ report did not include any specific recommendations to the Welsh Government. The Public Accounts Committee was very concerned by its findings and agreed to conduct an inquiry into the issues raised by the report, with particular regard to determining what lessons the Welsh Government could learn from the episode.

4.1 The Chair welcomed Gareth Hall to the meeting.

4.2 The Committee questioned the witness.

Action points:

Gareth Hall agreed to provide:

·         Further information on briefings provided to the relevant Minister with regard to the proposals by Clwyd Alyn Housing Association to use the site of the River Lodge Hotel.

·         Clarity on whether there had been other examples of the Welsh Development Agency / Welsh Government failing to conduct an independent red book valuation for land acquisitions.

·         Clarity on when the compliance review was comissioned.

·         An email received from Amanda Brewer’s line manager, outlining the nature of her role on the board of Powys Fadog and assurances that the conflict of interest was being managed effectively.