Bassadone Group deal does not make financial sense

Bassadone Group deal does not make financial sense

Government’s plans to on the one hand sell its buildings but on the other spend £5.5M in rental payments in favour of the Bassadone Group at Queensway does not make financial sense or deliver value for money.

As stated in Parliament last week, the Government is spending almost £22,000 a month in rent at a property owned by the Bassadone Group in order to house numerous Government departments, including the Care Agency, ITLD and the Education department. The Government has already spent £610,000 in rent over the last 18 months and the civil servants are not even in occupation of the property because the fitting out has not been done. It is unclear when it will exactly be ready. This significant expense does not take account of the cost outlay there will be in kitting out the office space.

While the sale of the properties where the departments are currently housed are, according to the Chief Minister, expected to realise between £8.8M and £10.2M, the reality is that there will be an on-going rental liability into the future. There will also be a loss to the Government of clearly valuable real estate for ever. All of this has been done on the potentially questionable basis that the Government says that the cost of refurbishment is prohibitive. Given that the 21 year lease will cost £5.5M and does not include the cost of fitting out the 3600m2 of property is this deal value for money?

What all of this shows is that a well-known business entity which is very closely connected with the GSLP will receive millions of tax payer pounds on the one hand while the Government, on the other, sells off public assets, no doubt to raise much needed cash in the first place.

Damon Bossino said: “The deal is for all these reasons, highly questionable and smacks of a Government that
is so desperate for cash that it is selling its own offices. Who, in the end, benefits?”