The Welsh Government's acquisition and action to dispose of the former River Lodge Hotel, Llangollen

14 Jun 2012 - 10:00am

Concerns about the acquisition of the River Lodge and proposals for its use were first brought to the attention of the Wales Audit Office in January 2010 by a former Assembly Member, who had represented her concerns to Ministers on a number of occasions but had not been satisfied with the information she had been given in response.

The decisions made by the Welsh Government, in 2007 to purchase the River Lodge for £1.6 million and in 2009 to enter into an Agreement for Lease with 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 Agreement for Lease, 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, although the appraisal did not include a full evaluation of the costs and benefits of feasible options. In our view, to ensure value for money, fully-costed options appraisals should have been integral elements of the decisions, in the first place to acquire the River Lodge, and then to agree to lease the property to Powys Fadog.

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