Labour under fire over collapse of China deal

Labour has come under fire from opposition councillors after admitting Sheffield’s £1 billion deal with China was dead.

By Lucy Ashton
Wednesday, 10 July, 2019, 11:45
Council Leader Julie Dore arriving in China to sign the agreement

The Liberal Democrats said Labour could “not be trusted” to run the city while the Green Party said they should stop “chasing visions of untold riches”.

Three years ago the council signed a 60-year partnership with Sichuan Guodong Construction in what was supposed to be the biggest Chinese investment outside London.

An initial £220m deal promised millions in foreign investment into the city over three years, and up to £1 billion over the following 60 years.

But Labour this week conceded the deal was over. The council had spent £40,000 wooing Sichuan Guodong Construction but it had not invested anything in the city.

The Lib Dems have repeatedly raised the lack of progress at meetings and demanded updates.

Lib Dem Leader Coun Penny Baker said: “The truth always comes out in the end. Labour announced this deal in 2016 to great fanfare, they claimed it was the biggest deal outside of London but right from the start, the numbers just didn’t add up.

“We know that the Labour council has been courting this investor for years. Tens of thousands of pounds of taxpayer’s money has been spent on flights to China – including a trip by the Council Leader Julie Dore. 

“Senior Labour councillors need to take responsibility for misleading the people of Sheffield. This once again shows that Labour cannot be trusted running our city.”

The Green Party said the good news was that it would give some certainty and allow fresh thinking about the options to make the city better.

Coun Douglas Johnson said: “It’s OK to try, even if you fail – but this was an announcement that was so grand in scale and ambition, but so lacking in detail and openness, that it was never designed for the people of Sheffield.  

“Instead it gave every appearance of selling off public assets, like the Central Library, to whoever had the newest and flashiest money, with secret deals and conflicting public statements.

“We were told of a confidential exclusivity deal before it was officially denied that such a deal existed. 

“It is time for Labour to stop chasing visions of untold riches and to focus on development that is good for Sheffield’s core strengths.”

Meanwhile, a former Labour councillor said he knew the China deal was over years ago. Coun Steve Wilson tweeted: “It was over years ago, indeed I knew it when I ran a scrutiny on it when I was chairman. Sheffield Labour knew about it too and have been defending a non-deal for the last three years.”