Meryl's millions

Update 5pm

As Meryl Gravell has told as all ad infinitum, she always defends the council's officers, and they always do a tremendous job. Strange then that at the last meeting of the full council in July where councillors queued up to give their thanks and best wishes to Roger Jones, Meryl remained silent. Stranger still when you recall that they would have worked together on a daily basis for at least the last 15 years.

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The Western Mail reports today that the Wales Audit Office is investigating a £2.63 million grant awarded by Cllr Meryl Gravell at a 15 minute private meeting in June.

Extraordinarily, the decision was referred to the WAO by Roger Jones, the council's Director of Resources who has just retired.
 
On 25 June 2014 Meryl held one of her decision meetings as Executive Member for Regeneration and Leisure. The public and press are excluded from these meetings, but according to the record, Meryl sat down at 2pm with just two officers. One of those carries the title of "Physical Regeneration PDF" Officer (PDF being short for Property Development Fund), while the other was from Democratic Services representing the Monitoring Officer. The Monitoring Officer's job is to ensure that decisions conform with the law and correct procedures are followed - a statutory function which in Carmarthenshire has been rendered less effective than a chocolate fire guard.


They then wrestled with their desire to be open and transparent while applying the public interest test. After what must have been several nano-seconds of soul searching, they decided that the report they were about to consider should be exempt from publication and kept secret.

It must have been a very short report because minutes later, at 2.15pm to be precise, the show was over and a grant of £2.63 million had been awarded to a company called JBCH Developments Ltd. for the development of a "food grade industrial unit" at Cross Hands.

Don't be surprised if you have never heard of JBCH Developments because although the company was incorporated in 1997, it has never traded, although in its rather long and quiet life it has had three different names.

Companies House records show that in its last set of accounts published in 2013, JBCH was dormant, with no assets and a paid up share capital of £2.

All of that changed suddenly in January 2014 when JBCH acquired a plot of land at Cross Hands from Carmarthenshire County Council. The value of this transaction is as yet unknown, but the money had to come from somewhere, and Finance Wales, a vehicle set up by the Welsh Government to fund small and medium sized businesses, provided a mortgage.

The mortgage is secured against the land and against a contract JBCH had won to build the "food grade industrial unit".

JBCH's registered address - its company headquarters if you like - is just across the road from the building site, care of Ajax Machinery, a company specialising in plant and machinery hire for the building trade.

The contract will involve JBCH building and fitting out what is in reality a meat processing plant to be operated, and presumably owned, by Celtica Foods, a sister company of Castell Howell, the food wholesaler which already has a substantial presence in Cross Hands, and the contract with JBCH was entered into by both Celtica and Castell Howell.

Celtica currently employs just under 50 people at a boning plant in Pensarn, Carmarthen, and those jobs will now be relocated to Cross Hands. The company hopes that the new plant will create up to 32 new jobs over the next five years, and in July 2013 Edwina Hart announced that the project would receive £1 million in grant assistance under the Welsh Government's repayable business finance scheme.

The cost of the new plant was put at £2.8 million, and the fact that a local company is expanding and creating jobs for local people is undoubtedly good news.

But let's return to Meryl.

The £2.63 million grant is coming out of the South West Wales Property Development Fund, a pot of money managed by Meryl and Carmarthenshire County Council, for a number of other local authorities across the region. A large part of the money in the SWWPDF fund is EU aid.

The fund's website says that certain industries are excluded from assistance. They include retail, house building, leisure and primary food processing. However, a footnote says that under some circumstances companies operating in these sectors may still be eligible.

One of the odd things about this award, aside from the fact that the money is going to a company with no track record and no assets to speak of until January 2014, is why the grant was awarded to the company developing the factory rather than the company which will own and operate it and presumably pay for it.

If you tot up the value of all of the grants and interest free or subsidised loans handed out for this £2.8 million development (that was the value according to the Welsh Government last year), you will come to around £4 million. Again, if Celtica is buying the plant, which is what we have been led to believe, why did the grant go to JBCH?


The decision also raises fresh concerns in the ongoing debate over governance in Carmarthenshire. Is it right that one councillor acting alone in secret, in a closed meeting can sign off such large sums of money, with no need to refer the decision to the Executive Board, let alone the full council?

In its carefully worded response to the Western Mail, Carmarthenshire County Council gives the impression that the investigation is perfectly normal.

Why did the grant go to JBCH rather than Celtica? Well because JBCH applied for it, comes the reply, which goes on to describe the process which grants are supposed to go through. The council decided to refer the grant to the WAO just to make sure everything was in order.

Cneifiwr understands that reality was subtly different. The grant decision was referred to the WAO because of concerns over possible irregularities.

Roger Jones, it should be remembered, also tried to stand up for the interests of the county council and council tax payers in the Marstons deal in Llanelli, only to find that he was over-ruled.