A report has criticised the "avoidable haste" with which the Welsh Government spent £4.25m on a Brecon Beacons farm in an attempt to secure the future of Green Man festival. The purchase of Gilestone Farm has been mired in controversy since it emerged that the music festival plans to stay at its original site near Crickhowell.
Adrian Crompton, the auditor general for Wales, has completed an investigation and raised several concerns ranging from the level of due diligence to the advice given to economy minister Vaughan Gething, who approved the deal. He found that the "haste" of the purchase was linked to a desire to use an in-year underspend.
But Mr Crompton also said a longer timeframe would not necessarily have led to a different decision. And the government has responded that the report makes it "clear" the acquisition "followed the appropriate processes".
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The government bought the 240-acre farm last March — before a full business plan had been provided by the Green Man festival, which has been held at the Glanusk estate for two decades. The Gilestone site in Talybont-on-Usk was being used as 'glamping' holiday accommodation and a farm.
Mr Crompton wrote that the Government did not keep a record of what was discussed with Green Man in "various virtual meetings" to consider the business plan outline. But he found that the "most significant" factor behind the pace of the decision was an opportunity to use an in-year underspend in the government's Economy Main Expenditure Group.
Officials "emphasised" to Mr Gething that the purchase would have to be completed by March 31 if the underspend was to be used. A week before that deadline he agreed to proceed with the £4.25m deal.
The auditor general said he recognised that the government had been in discussions with Green Man about potential sites for some time. "However, in relation to Gilestone Farm, we consider that avoidable haste driven by the financial year-end compromised the Welsh Government’s ability to clearly articulate and fully consider as part of its decision-making process the underlying rationale for purchasing that site, linked to Green Man’s intentions for it," he added.
"In our view, these issues do not fundamentally undermine that decision’s procedural integrity if regarded, in the first instance at least, as a straight property transaction. Nevertheless, it is clear that the Welsh Government would not have bought the farm had it not been approached by Green Man with what... was little more than a high-level outline of Green Man’s aspirations.
"We will not speculate about whether, given a longer timeframe, the minister would still have made same decision. However, with more time the Welsh Government could have undertaken greater due diligence before making any decision. By buying Gilestone Farm when it did, the Welsh Government accepted an avoidable financial risk, albeit one which officials have emphasised to us was, in their view, low and manageable."
Mr Crompton also found that officials' advice to Mr Gething provided "limited information" on how the land’s suitability for Green Man could be affected by potential issues around site access, planning requirements, and parts of the site being environmentally sensitive. The report also says "proper consideration should have been given" to using a different funding budget and deferring the purchase of Gilestone Farm until there had been due diligence on a full business plan from Green Man.
Ministerial advice before the decision had said the festival was constrained by a lack of available land to accommodate visitors. Mr Crompton believes this suggested that increasing capacity was the main objective for the deal and that some festival activities would relocate to Gilestone. But the government has told the auditor general that this "was not actually their intention" — which was instead "to support extension of the Green Man brand and help to secure its future in Wales".
Green Man, meanwhile, has said is will not be relocating to Gilestone but may host smaller events there each year. They intend for the farmland to remain in agricultural use and for the accommodation to be in residential and tourism use.
On making the deal, the government agreed to lease the land back to the previous owner at a peppercorn rent to maintain the property and harvest crops. The lease expired last October before being renewed on what the report described as "commercial terms, including a profit-share". This new lease is due to expire this October.
The report adds: "Despite obtaining an independent valuation of the site which was £75,000 higher than the actual purchase price, in the event of an onward sale, the Welsh Government may not be able to recover the full purchase price, either due to market conditions or to separation of the site into separate lots, which are in total worth less than the whole site in a single lot."
Conservative Senedd group leader Andrew RT Davies argued the report "highlights the latest example of Labour ministers in the Senedd recklessly throwing around millions of pounds of taxpayers' money to fund a new vanity project". He added: "There is currently an A&E crisis in Wales and the time and money Labour spent on Gilestone Farm should instead have gone towards our Welsh NHS."
And Plaid Cymru's agriculture and rural affairs spokesperson Mabon ap Gwynfor said: "It's deeply concerning to see that Welsh government may not be able to recover the full purchase price, and that the speculative purchase of the farm included such financial risks. Welsh Government must give full account of the reason why they made the purchase before obtaining a full business plan, and somebody must be held accountable for this."
A spokesman for the Welsh Government said it welcomed the Audit Wales review. He added: “It is clear from the review that the acquisition of Gilestone Farm followed the appropriate processes, was value for money and is clearly aligned to our economic ambitions.
“Due diligence work continues on Green Man’s detailed and comprehensive business plan which will conclude in the coming weeks. No final decision on the future of Gilestone Farm will be made until the due diligence process is complete.”
There are reported to be plans to hold up to three gatherings a year at Gilestone for as many as 3,000 people. Talybont-on-Usk residents have voiced concerns that their village will be overrun.
Green Man attracts more than 25,000 visitors each year. You can read more of the latest news about the festival here.
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