Manx Gov facing double-whammy of massive infrastructure liabilities – which could trigger credit meltdown

• The final cost of the new Isle of Man-owned ferry terminal in Liverpool is still a mystery.
• This week Treasury Minister Dr Alex Allinson admitted that the total bill has not yet been finalised – despite opening the facility more than a year ago –  according to IoM Today.
• Estimates for the budget-busting project have ranged from £75 million, to north of £85 million.
• But this is not the only big money uncertainty facing the troubled Treasury and the Department of Infrastructure.
• Both departments are on the hook for a separate potential £90 million court payout over an alleged ‘mishandled’ Lord Street development, which is denied.
• Recently ex-Minister Chris Robertshaw was the latest Manx luminary to take aim at the Island’s legacy of infrastructure debacles.
• He specifically cited the ballooning cost of the ferry terminal and the failings on Lord Street as examples of big government projects gone wrong.

The Isle of Man taxpayer is facing a double-dose of uncertainty this summer.

Treasury Minister Dr Alex Allinson announced this week that the final cost of the Isle of Man ferry terminal in Liverpool is still unknown – despite having opened more than a year ago.

The reason for the delay, according to an answer in the Tynwald, is that the Department of Infrastructure is still wrapped up in legal wrangles with the controversial project’s contractors.

An insider familiar with the project told expose.news that, ‘presumably the builders and their associates still want more money, despite going over budget two-fold.’

But this is not the only bad news surrounding the governments two most difficult departments.

Both the Treasury and the DoI have still not settled their joint dispute with a property developer who is suing them for alleged corruption and malfeasance over the cursed Lord Street site.

Lawyers for the Treasury and DoI deny all wrongdoing.

The case could cost them £50 million but some sources have put the figure as high as £90 million amid mounting legal costs as the hearings drag on into the SEVENTH year.

A Douglas businessman with close links to the City of London, who did not want to be named, said: ‘The timing of this is not great. The debt burden of the Isle of Man is a growing concern, both here and in London.

‘We haven’t balanced our books for well over a decade. This kind of thing – not knowing what our liabilities are – is not a great look in front of the markets.

‘There’s too much uncertainty. There’s a danger of a perfect storm here…. big court cases….projects with runaway budgets….blackholes. I wouldn’t be surprised if it triggers a technical default.

‘There’s been speculation about losing our grade A credit rating – it’s not beyond the realms.’

The revelations about the ferry terminal came out at this week’s Tynwald sitting after Douglas Central MHK Chris Thomas asked Treasury Minister Dr Alex Allinson what the final cost of the Isle of Man Ferry Terminal in Liverpool is, according to the BBC.

Dr Allinson told Tynwald there are still ‘a number of issues to resolve’ which is being handled by the Department of Infrastructure’s (DoI) legal advisers.

He said: ‘On this basis, Treasury cannot be currently certain of the exact final cost, as previously stated in this honourable court. The time to debate this project is when we have the final account and all the facts are clear when the final account is settled.

‘The intention has always been to bring the Isle of Man ferry terminal Liverpool scheme to Treasury to Tynwald for a supplementary vote to regularize the budget position.’

The news comes after recent criticism from former minister Chris Robertshaw who called for government reform to prevent further ‘serious mistakes’ being made on big Isle of Man building projects.

The ex-Deputy Speaker of the House of Keys criticised the Department of Infrastructure for not being able to handle big projects.

Speaking about failings in the decision-making process of the Council of Ministers, Chris Robertshaw said: ‘….it means that capital projects end up being allocated to mainly the DoI who do not have that broad base competence and experience to deal with each new challenges. It comes along. And so you may be aware that the Isle of Man has made a significant number of serious mistakes over a lot of its capital projects.’

His stinging words followed the ongoing Lord Street court case which threatens to plunge the DoI’s finances into the red.

The costs could top £100 million, sources close to the case have warned.

For the past seven years a developer called Sondica Group Incorporated has been suing the IoM government over alleged corruption and malfeasance in connection with the calamitous Lord Street revamp, which is denied.

The two government departments being sued – including the under-fire DoI – are on the rack for any losses.