Council says that huge scheme to transform former Birmingham wholesale market site could leave £29 million cost
Birmingham Council has said the enormous Smithfield development could leave it facing a £29 million cost to meet the demand for extra school places.
The massive “once in a generation” scheme is set to transform the former Birmingham wholesale market site, turning it into a landmark destination in the city centre.
The plans, which were approved last year by council planners, includes proposals for housing, cultural spaces, office space, a theatre/cinema, market, park and more.
The huge project has sparked optimism that it can create a must-visit site in the heart of Birmingham; boost the city’s international standing; and unlock commercial opportunities.
But a recent council report has highlighted that providing over 3,000 new homes through the Smithfield plans will lead to the requirement of additional school places and possibly a huge cost to deal with.
The report said: “Additional requirements of Smithfield is likely to lead to the need for more than 1,000 primary/secondary/early years/SEND places at an estimated cost in the region of £29.58 million.
“At this stage, if the scheme is to progress, the council, as a worst case position, will need to underwrite the costs of the education provision.”
The council, which has been hit by a financial crisis, acknowledges that this would be “less than ideal”, saying it will increase the pressure on already “extremely constrained capital resources”.
With other planned schemes set to increase the number of homes in central Birmingham, it went on to say: “A more strategic approach to identifying the increased demand on service provision, including education, will now be required
“Discussions on the future needs of the city need to commence.”
It added that this will include talks with the Department for Education around the increased demand for school places.
In a bid to minimise the impact on its resources, the council stated its officers will explore “all routes” for external funding.
The council said: “Education officers will continue to work collaboratively with the project team to plan effectively and ensure that school places are created in a timely manner as demand materialises.”
It said this would help ensure that the council remains in a position to meet its statutory duties regarding school provision.
It also stated that the Full Business Case and viability assessment will need to more “clearly define” the required provision and how the cost will be met.
‘Major regeneration opportunity’
In the report, the Smithfield project was described as one of Birmingham’s most significant development opportunities and a “key strand” of the transformational plans for the city centre.
It added that it was recognised as a “major regeneration opportunity, being the largest single city centre redevelopment site in the UK”.
The council has also said in the past that the benefits the development could bring include the creation of new jobs, further investment in the area, housing, a new public square and open space.
But questions were raised last year after the real estate group behind the scheme announced it would be stepping back from UK construction.
Lendlease, which has been working in partnership with Birmingham City Council on Smithfield, revealed at the time major restructure plans which would see development and construction become ‘Australia only’.
But it was confirmed earlier this year in May that Lendlease and The Crown Estate had agreed to enter into a partnership to create a new joint venture.
It will allow The Crown Estate, an independent business belonging to the Monarch, to invest in Lendlease’s undeveloped UK land and land management portfolio, providing support on existing projects.
The Smithfield plans are set to be discussed at a council meeting next Tuesday, July 22.
Cabinet members at the council have been recommended to approve local authority to underwrite the estimated £29.58m to fund the cost of meeting the additional education provision “if alternative funding is not identified”.
Several issues have contributed to the recent financial turmoil at the Labour-run city council according to external auditors.
These include the equal pay debacle, inadequate budget setting, poor service management, demand led pressures and the disastrous implementation of a new IT system.
Labour politicians have also highlighted the impact of previous funding cuts on local government.
