Who was in control?

Wednesday 14 December 2016

A damning report has been published into the way the States handles its property assets, following the fuel farm fiasco.

Earlier this year States Members agreed a new ten-year lease on the critical site, after the opportunity to give notice to the existing tenants – La Collette Terminal Ltd, owned by Rubis – was missed.

It prompted an investigation by the States spending watchdog, the Public Accounts Committee, which has now completed its report.

The report comments: 

“The PAC is very concerned that despite the significant value of land and buildings owned by the States (exceeding that of the strategic reserve), it appears that insufficient skills and resources are dedicated to managing such a vast estate.

“The PAC has concluded that opportunities for States Members to consider options for acquiring the assets of the fuel farm had been missed, due in large part to no single department having overall responsibility for the security of fuel supply to the Island. By the time they were notified of the decision to renew the lease in early 2016, the only reasonable course of action open to Members was to ratify the renewal of the lease to the current operators.”

However, the Panel’s Chairman, Deputy Andrew Lewis, has welcomed the fact that since the opportunity to cancel the fuel farm lease was missed, one Department has now been made responsible for ensuring a similar problem doesn’t happen again:

“The PAC is pleased to note that one department, namely the Department for Infrastructure now has ultimate responsibility for the management of assets. The Chief Executive has accepted that lessons should be learnt and that there is a need to plan well in advance.”

The report goes on to warn that the States failure to properly oversee what is a major strategic asset for the island could have pushed up fuel prices.

“Failure to act in a timely manner may have had a negative impact on the cost of fuel to the Jersey taxpayer. Failure to capitalise on the opportunity to gain complete control of the land on which the fuel farm sits, could have a long term negative effect on the future value of significant and strategic land assets, and on long-term strategic planning. The PAC accepts that safety and security of supply of fuel to the Island must come first, but concluded that this did not have to be achieved to the detriment of good strategic planning.”

It emerged during the Panel’s hearings that responsibility for the site at the time it was necessary to decide on whether to renew the lease, was split between two many States departments.