The Welsh Audit Office is investigating how public money was given and spent in connection to the Circuit of Wales project, less than a month after what was expected to be the final piece of private funding.
In 2014, the Welsh Government awarded the project a £2m development grant while also underwriting a £7.35m bank loan to cover the company running the project’s debts.
Monmonth MP David Davis, whose constituency sits 30 miles away from the Ebbw Vale site where the Circuit of Wales is planned to be build, has called for a suspension on any further funding for the scheme until the Welsh Audit Office compiles an inquiry into evidence received from a whistle blower on the scheme.
It has been reported by BBC Wales that the evidence questions how public money was spent by the Heads of the Valleys Development Company led by former Bahrain International Circuit CEO Michael Carrick.
“I think they should say to Michael Carrick ‘it’s down to you if you have private investors out there willing to back the scheme, bring them forward let us know who they are’,” Davis told BBC Wales.
“At least £9m has gone into this scheme of public money and I think that it’s time they started to find out what’s happened to that money and not put any more money into it.”
The Welsh Government has stated it agreed to the £2m grant and £7.35m loan on its policies and can ask for the return of the loan but has not yet opted to do so.
The Welsh Audit Office examination brings up the latest hurdle to the project, after the Welsh Government rejected Carrick’s proposal that it underwrite a £350m deal with private investment from Avivia.
After the recent local elections Carrick asked new Infrastructure and Economy minister Ken Skates MP to underwrite 75% of the project but once again this was rejected, with the latest deal projected to see the government underwrite only half of the finance.
In October, it was announced merchant bank Kleinwort Benson in London is set to stack up £100m worth of private investment for the Circuit of Wales and was described as ‘the final piece of private funding required’.
The venture secured a five-year deal with Dorna to host the British MotoGP which began last year and had originally hoped to move the event to Ebbw Vale in 2017. After interruptions in confirming financial backing MotoGP has been delayed by 12 months, with the Welsh circuit expected to take over hosting duties in 2018.
Silverstone has hosted the first two years of the British MotoGP contract the Circuit of Wales holds and will be called upon for the 2017 race.
Read more at http://www.crash.net/motogp/news/234948/1/government-investigates-circuit-of-wales-funding.html#y3E5y1tIUY5XBtwz.99