Arun District Council may be forced to pay up to £18 million on work to revamp Littlehampton Harbour – a decision which would lead to even more services being cut.
Yesterday, council leader Martin Lury warned the financial consequences could be “extremely damaging” to the council’s budget as he updated members on a high court decision.
The harbour management brought a high court claim over the council’s refusal to pay additional infrastructure costs in March last year after Arun failed to comply with a request the previous December to help pay for work to explore what updates are needed to the harbour entrance’s 1920s infrastructure.
West Sussex County Council agreed to pay their half of the infrastructure costs in February 2023 – but Arun refused.
However, on December 18 last year, Judge Melanie Plimmer said this refusal would be “quashed” and an “up to date” request from the board should be submitted, which the council will be “required to respond to”.
Leader of the Council Martin Lury (LDem, Bersted) told a meeting of the full council on Wednesday, January 8, although it is ‘unclear’ exactly how much the council will need to pay, the board could request around £18 million following the decision.
He said: “This would result in additional borrowing costs of approximately £1 million per annum over a 40 year period.
“The council’s current net revenue budget is £28 million and the burden of these costs would be extremely damaging.
“It would probably mean cuts to other valuable public services provided by the council and probably would result in redundancies. The council will inform the public as soon as we’re able to share more information.”
The district council argued that it was not legally liable to pay for the “disproportionate and unaffordable’ capital costs. The board claimed that this was a misinterpretation and an “error of law”.
The board also said they were seeing budget constraints and were likely to go bankrupt due to the infrastructure costs, stating in the decision it would “not have sufficient funds to meet its core duties” without the funds requested from the council.
The decision notes that for the last 23 years the harbour has relied on support from West Sussex County and Arun District councils to stay afloat.
It says this is due to debts with the Public Works Loan board, ongoing budget deficits using its generated income which cannot be put away for repairs, and a reduction in commercial shipping through the harbour due to ships getting larger and outdated harbour infrastructure.
The board applied in 2019 for a Harbour Revision Order from the government to help the board put money away to update its infrastructure, but this remains undetermined.
