Is the opening date of Brecon’s Y Gaer cultural hub under threat as a result of the collapse in the share price of construction giant Kier?
That’s one of the questions opposition group councillors want answers to as they call for an urgent review of the contracts Powys County Council has with Kier.
The company has seen its share price plunge by more than 30 per cent in the last month.
There are fears Kier could collapse after it announced an emergency plan to raise £264 million to cut its debt of more than £600m.
It comes as some share speculators are betting against the company’s survival.
In the county, Kier is in partnership with PCC, looking after the housing stock in joint venture, Heart of Wales Property Service.
Its purpose is to repair and maintain the housing, public and commercial buildings that were looked after by the council.
Kier has also been building the flagship museum project in Brecon ’Y Gaer’ – Welsh for fort.
Building work has dragged on beyond the projected opening date and costs have spiralled beyond the original calculation of £9m to an estimate of £14m.
Plaid Cymru Group Leader Cllr Elwyn Vaughan, who represents Glantwymyn, said: “We have a joint venture with Kier.
“I want assurance that Kier is still a viable entity.
“And what risk assessment has been done to minimise the liabilities to Powys Council?”
“In recent months we have seen a major outsourcing company, Carillion, going to the wall and another company, Interserve, in severe difficulty.”
Labour group leader Cllr Matthew Dorrance, who represents St Johns ward in Brecon, said: “It cannot be right that a company propped up by public funds evades any public scrutiny.
“We put forward a plan to ensure democratic accountability of Heart of Wales Property Services so that it serves the people of Powys not profit margins.”
Cllr Dorrance believes that the ruling coalition’s decision to vote against the motion could have consequences now.
Haydn Mursell, chief executive of Kier Group plc, said: “There has been a recent change in sentiment from the credit markets towards the UK construction sector, with various lenders indicating that they will be reducing their exposure to the sector.
“This has led to lower confidence among other stakeholders and an increased focus on balance sheet strength.
“The Rights Issue is intended to address these issues, better position Kier to continue to win new business and further strengthen our market leading positions.”
A spokesman for Powys County Council said that questions on the viability of Kier should be directed to the company.
Nigel Brinn, Powys County Council director of environment and board member of the Heart of Wales Property Services, said: “We can confirm that the council has received formal questions regarding Kier and that responses will be provided at a meeting of the full council in January.”
Y Gaer (Welsh for Fort) is the new revamped Brecon Cultural Hub which is the redevelopment of the Brecknock Musem and is to become a new library, art gallery and community facilities.
PCC is expecting a handover of the building soon with the official opening on March 1.
Heart of Wales Property Services looks after 5,400 homes and 630 properties in the county.
The joint venture with PCC started in July 2017 after 109 workers were transferred to the company by TUPE.
Work has been carried out from the three former council bases in Brecon, Llandrindod Wells and Newtown.