Dome still costs public £3m a year

THE DOME will carry on costing the taxpayer about £3m a year until its developers win planning permission, under an extraordinary deal agreed by the Government. The bill, which covers the annual cost of maintaining, insuring and securing the attraction, means that the public will carry on bankrolling the project for some time, despite previous Government assurances that the private sector would shoulder all the risk.

Lord Falconer, minister with responsibility for the Dome, was expected to announce details of the deal today, in which the Dome and the surrounding 190 acres are given away to the developer Meridian Delta (MDL), in exchange for a share of future profits.

The announcement, expected to be made in the Lords this afternoon, has already been delayed after a last minute hitch when it transpired that British Gas's property arm, Lattice, was threatening to take the Government to court. Lattice is demanding that under a five-year deal signed in 1997, it is owed 7.5% of the land's market value, which could amount to some £40m.

Lord Falconer was locked in talks on Tuesday over this and a number of other issues surrounding the site on the Greenwich peninsula. But when he makes a statement on the venture later today, the minister - a close friend of Tony Blair who has taken most of the flak for the embarrassing saga over the attraction - will argue that it represents value for money.

Under the scheme, the Dome will be converted into a 20,000-seat arena for concerts and sports events. The land around will be sold off in packages, for businesses and housing, with the Government taking up to a 50% share in the profits.

Lord Falconer will put the best possible interpretation on the deal, claiming that it could result in more than £500m coming back to the public purse over the next 25 years. But the £3m-a-year maintenance and security costs will be criticised by MPs, who wanted to see the Government rid itself of the troubled attraction.

The complex planning process involved in allowing the Dome to be used as an arena could take at least 18 months - or longer if Ken Livingstone decides to hold up the approval. MDL does not initially pay a penny for the land, or its 999-year lease of the building. Instead, it pays for parcels of land as it is developed.