Ernie Clark. Hilperton Division, Wiltshire Council.

Seven years and not one house built.

Wiltshire Council's Private Finance Initiative (PFI) to build 400 houses for rent has been in development for seven years and has yet to build a single house.

Silbury Housing Ltd (SHL), a consortium of Sarsen Housing Association, Barclays Private Equity and Persimmon Homes, has been contracted to deliver the scheme.

In November 2009, the WC cabinet agreed to proceed with a reduced scheme of around 350 homes, on a phased basis, with approximately 242 being provided in Phase 1. It was also agreed to submit a final business case with the intention of signing the PFI contract by the end of March 2010.

The project was then delayed again due to uncertainty about land ownership and difficulty in commercial negotiations with SHL.

Despite the collapse in demand in the private housing sector, Persimmon Homes asked a higher than expected price for their land to compensate for not being able to develop the sites commercially if they're used for PFI!! This meant that the cost per house as built came out at £156,000. Amazingly, the WC Cabinet believed this is value for money, despite the risk that the government may not agree and might withdraw their offer of financial support.

Next, the scheme ran into more trouble with the identification of legal restraints on two parcels of land intended to be developed. One of these was the parcel of land off Ashton Road, Hilperton. In April a report went to the WC Cabinet recommending appropriation of the land to over-ride any potential problems. This would take away the rights of anyone with an interest in the land to block the scheme, but would allow compensation to be paid if such people came forward.

Cabinet approval to enter the agreement with SHL was finally granted on 17 June 2010. Meetings have subsequently taken place in London with the Department for Communities & Local Government plus the Homes and Community Agency (HCA). These proved positive with confirmation that there was a desire to drive through the project; however this would be subject to scrutiny by the government.

The Council's Environment Committee will receive an update on November 2nd.

The Council's total costs to date are about £2 million, of which £1.3 million has been spent and is irrecoverable regardless of whether the project proceeds. A budget of £350,000 has been identified for 2010/11. It remains a real possibility that the PFI scheme will be pulled without a single brick being laid.

The scheme is already unusual in as much as the government would not normally allow a scheme with only one 'bidder' to proceed. Quite why an exception was made for this scheme is unclear.