Government reveals Dome 'sale'

THE Government finally announced a deal for the future of the Millennium Dome - but left unanswered the key question of how much, if any, of the millions poured into the project will be recovered.

Transport Secretary Stephen Byers and Dome Minister Lord Falconer confirmed the structure will be turned into a 20,000-seat sports arena, and the surrounding 150 acres of land on the Greenwich peninsula will be developed into homes and offices by the Meridian Delta Limited (MDL) consortium.

But the immensely complicated joint venture appeared to raise more questions than it answered. Official sources were either unwilling or unable to say how much the taxpayer will be paid back under the scheme, or how much money is being put upfront by MDL.

The announcement came as a written parliamentary answer with no chance for MPs to ask questions, and none of the fanfare that accompanied the original unveiling of the project, which swallowed up £628m of Lottery cash. Officials maintained the deal was not a public-private partnership, or PPP; that MDL was not a 'preferred bidder' although it is the only contender; and that it was not a leasing arrangement, although it is being handed over under a 999-year lease.

They said they were entering into an 'exclusive relationship' with the consortium and that it was actually a sale, despite the fact that the consortium-will not be paying a lump sum for the site or the Dome. Instead, the Government will take a share of profits from the running of the Dome as a sports and entertainment arena, and also from the sale of hundreds of homes to be built. Negotiations are likely to continue for several months, but ministers hope to sign a deal in the spring.

The consortium, the Government claims, has plans to invest up to £4bn to build homes and offices. Some space will be made for parks. Lord Falconer said: 'This is a good deal with a world class consortium which is likely to generate better value for the public sector than all earlier offers. It will bring hundreds of millions of pounds to the taxpayer and create thousands of houses and many thousands of jobs. In providing a 999-year lease on the Dome and surrounding land we are securing in the region of £4bn of investment to develop a long-term, sustainable future for the Greenwich peninsula.'

Final contracts have yet to be signed, he stressed, 'but we are entering the last phase of negotiations very positively with people who have a track record around the globe of delivering the sort of top class facilities London deserves'.

One of the backers is Phil Anschutz, an American oil magnate whose company Anschutz Entertainments runs major sporting events in the US. The other members of the group are property developers Lend Lease, which built the Sydney Olympic Village, and Quintain Estates. The deal follows two previous attempts to sell the Dome for £125m, after it lost hundreds of millions of pounds because fewer visitors than expected turned up during 2000.

The high-profile project has caused Tony Blair a series of embarrassments, from the original squabbles over what to put inside the building, to the increasing costs of keeping it empty since it closed at the beginning of the year.

A cash-guzzling life of controversy