The £425 million Circuit of Wales project has been dealt a potential final blow, as the Welsh Government refused a proposal to guarantee £210 million to backers of the Ebbw Vale development.
The Circuit of Wales was first proposed back in 2011, and was awarded a five-year contract by Dorna Sports to host the British Grand Prix from 2015, with an option for a further five years available to them.
However, the project – which was due to begin construction in 2013, though ground is yet to be broken – has hit numerous stumbling blocks in its troubled lifespan, with several proposals to have the Welsh Government underwrite the budget for the circuit using taxpayers money rejected.
Earlier in the year a funding proposal from the Heads of the Valleys Development Company, the firm behind the project, to have the Government underwrite 50% of the £425 million was put under serious consideration by Economy Secretary Ken Skates.
The project was put on hold soon after that proposal was issued to undergo a process of due diligence, while the recent UK general election further delayed the Welsh Government’s verdict.
In a cabinet meeting held on Tuesday, Mr Skates told ministers the costs were still too high and would impact on spending elsewhere, and that the estimation of 6000 jobs to be created by the project was ‘overstated’.
“The due diligence interrogated the company’s estimate of 6000 potential jobs to be created across all elements of the project and found it to be significantly overstated,” he said.
“It indicated that once the initial track and directly related development – which was presented to Cabinet today – had reached a steady state of trading around the year 2024, the number of direct full-time equivalent operational jobs would be little over 100.
“In addition, the circuit development could create around 500 indirect FTE jobs through potential visitor spend, as well as approximately 500 FTE construction jobs while the track was being built.”
Mr Skates confirmed that the Welsh Government would instead invest £100 million over the next decade to build a new automotive technology business park – which was due to be built as part of the circuit development along with an entertainment park – on the Ebbw Vale site.
The Circuit of Wales has organised the British Grand Prix since 2015 at Silverstone, and is set to do so again this year. However, the long-term future of the race is unknown after today’s announcement.
