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Cardiff Airport purchase wasted millions, Welsh Tories claim Cardiff Airport purchase wasted millions, Welsh Tories claim
(35 minutes later)
Ministers have been accused of wasting tens of millions of pounds buying Cardiff Airport for around double an accountants' valuation of £20m-£30m.Ministers have been accused of wasting tens of millions of pounds buying Cardiff Airport for around double an accountants' valuation of £20m-£30m.
BBC Wales understands the estimate from accountants KPMG appears in a report to be published by the Wales Audit Office. Welsh Tory leader Andrew RT Davies accused Labour of a "stunning failure to safeguard taxpayers' money" in paying £52m for the airport in 2013.
Months later, after negotiation and a further valuation, the Welsh government bought the airport for £52m in 2013. The estimate by accountants KPMG is in a report by the Wales Audit Office.
Welsh Tory leader Andrew RT Davies accused Labour of a "stunning failure to safeguard taxpayers' money". The Welsh government said BBC reports based on those figures were "entirely selective and misleading".
The Welsh government's purchase of Cardiff Airport from its Spanish owners Abertis followed years of concern about its performance and long-term viability. The decision to buy Cardiff Airport from its Spanish owners Abertis followed years of concern about its performance and long-term viability.
First Minister Carwyn Jones defended the deal at the time as a means of securing the airport's future as "a vital gateway to Wales", to be run at arm's length from government.First Minister Carwyn Jones defended the deal at the time as a means of securing the airport's future as "a vital gateway to Wales", to be run at arm's length from government.
Bristol Airport chief executive Robert Sinclair had claimed the purchase price was well above market value, while the Welsh Conservatives demanded proof that "nationalising" the airport was value for money.Bristol Airport chief executive Robert Sinclair had claimed the purchase price was well above market value, while the Welsh Conservatives demanded proof that "nationalising" the airport was value for money.
'Over the odds'
Reacting to the revelations on Wednesday, Mr Davies said it was "unforgiveable", following Tuesday's apology from Mr Jones for the handling of land sales to raise money for regeneration.Reacting to the revelations on Wednesday, Mr Davies said it was "unforgiveable", following Tuesday's apology from Mr Jones for the handling of land sales to raise money for regeneration.
"This is yet another example of the Welsh Labour Government's stunning failure to safeguard taxpayers' money, with tens of millions of pounds going to waste - despite clear, professional advice which should have told them that the price they were prepared to pay for the airport was over the odds," the Tory leader said. "This is yet another example of the Welsh Labour government's stunning failure to safeguard taxpayers' money, with tens of millions of pounds going to waste - despite clear, professional advice which should have told them that the price they were prepared to pay for the airport was over the odds," the Tory leader said.
"At a time when councils, hospitals and schools are facing a financial squeeze we have two clear examples of Labour wasting huge sums of money.""At a time when councils, hospitals and schools are facing a financial squeeze we have two clear examples of Labour wasting huge sums of money."
Welsh Liberal Democrats economy and transport spokesperson Eluned Parrott added: "This is another huge blow to the Labour Government's already tattered economic reputation." Welsh Liberal Democrats economy and transport spokesperson Eluned Parrott added: "This is another huge blow to the Labour government's already tattered economic reputation."
A Welsh government spokesman said: "The BBC has taken a single set of figures from an 80 page report to wrongly suggest that the Welsh Government paid more than it needed in acquiring the airport.
"This is entirely selective and misleading. KPMG modelled a range of scenarios during the due diligence process. The resulting valuations varied greatly depending on the cost of capital applied to the calculations.
"After taking further professional advice including a public asset valuation from Arup, the Welsh government concluded that a valuation of around £55m would be reasonable from a commercial perspective.
"The public asset valuation of £472m [taking into account its wider value to the Welsh economy] also justified the price paid on public value for money grounds.
"We do not anticipate the Wales Audit Office will challenge this approach when it is published."
The revelations came as airport chairman Roger Lewis called on the UK government to give Welsh ministers the right to cut air passenger duty as a means of boosting the airport's fortunes.The revelations came as airport chairman Roger Lewis called on the UK government to give Welsh ministers the right to cut air passenger duty as a means of boosting the airport's fortunes.