Tuesday, 21 May 2013

Royal Sands Development on the Pleasurama Site in Ramsgate no money, no hotelier, no development


The council have now published the information that SFP Ventures haven’t come back with finance and that the council is going to start the lengthy and possibly expensive business of extricating themselves from this particular mess.

Here is the council document

Ramsgate Royal Sands – Options

To:                               Extraordinary Cabinet – 29th May 2013

Main Portfolio Area:     Operational Services

By:                               Mark Seed – Director of Operational Services

Classification:             Unrestricted

Ward:                          Eastcliff
  
Summary:                   To consider options for future action following the end of the four month period agreed at the 22nd January Cabinet meeting for the developers of Royal Sands to have demonstrated the financing for the construction of the development.
For Decision
  
1.0       Current Situation

1.1       At the Cabinet meeting on 22nd January it was resolved that
           
            “Cabinet set a review period of 4 months from 22nd January 2013 and request officers at the end of this period to prepare an options report to Cabinet if either the finance is not in place for the completion of the development or no agreement is in place for the construction and operation of a hotel.”

1.2       As the four month period has now passed without these criteria being met it is necessary that the options in relation to the future of the current development agreement and leases for this site are now considered.

1.3       In the meantime a petition was considered at the meeting of Council on 18th April as set out in Annex 1, and it was agreed that the petition be referred to the Overview & Scrutiny Panel. As a result of this the Panel agreed the following at its meeting on 23rd April:

1.      To set up a Pleasurama Site Development Task & Finish Group as a priority scrutiny project for 2013/14;

2.      Officers to draft the terms of reference

1.4       At the time of drafting the report the Scrutiny task and finish group has yet to meet and consider its terms of reference.

2.0       Discussion and Proposals

2.1       The issue of the development of the Pleasurama/ Royal Sands site has been a matter of contention since before the decision to take forward the current proposals at the end of 2002. This has surrounded all aspects of the development including its form agreed under planning, the choice of the developer, the nature of the developer, the conditions within the agreements and changes to these, and retention of the developer despite the site not being moved forward.

2.2       This process has taken place under three separate administrations, but needs a collective way forward for the council that represents a political accord. This should reflect the need for a development to be completed that complements the future regeneration of Ramsgate, and provides a financial return for the council on a key water front site.

2.3       In addition, the future of the agreement and leases with SFP needs to be assessed carefully, as unilateral decisions on these by the council are almost certain to be challenged legally by the developer. The bottom line is that such action is uncertain, potentially costly, and likely to take a long time to resolve.

2.4       It is important that consideration of this issue is primarily focussed on where we are going and how to achieve that aim, with the prime elements being:

·     An agreed development for the site
·     A timescale to complete this development
·     A financial return to the council for the site
·     An understanding of the risks involved in any course of action

2.6       The report is specifically not proposing a legal way forward for the council as this requires to be considered in a way that does not prejudice any future court action and the position of the council within this. Such a way forward also needs to be supported by high level commercial and legal advice that dovetails with the direction of travel for the council.

2.7       In this context it would seem to be appropriate for Cabinet to support the setting up of the task and finish group by Overview and Scrutiny and ask them to consider and recommend a course of action. In doing this it would be appropriate to consider the following:

·     Encouraging the task and finish group to focus primarily on the key issues to help guide the way forward for the council as a whole
·     Committing Cabinet in supporting the work, including the cost of seeking confidential legal and commercial property advice
·     Advising that consideration of action moving forward that may involve legal processes needs to be done in a way that does not prejudice the position of the council
·     Ensuring that the legal, financial and time risks associated with any proposed course of action are considered with care
·     Encouraging an expeditious result so that Cabinet can move forward on this

2.8       Due to the lack of progress by the developer it is no longer possible to consider the option of waiting for them to deliver, even though the final deadlines within the agreement have not been breach. In addition, the need for a cross party independent consensus on future action supports the role of the Scrutiny task and finish group, rather than alternative routes.

2.9       The council has been very supportive in relation to this development, mainly in recognition of the difficult financial market over the last 5 years. However, the repeated failure of the developer to make progress is no longer acceptable to the council. The lack of any substantial progress in resolving the issues that were discussed in the Cabinet report in January, and failure to reach a conclusion within the four month period agreed by Cabinet, gives the council no confidence for the future.

2.10     On this basis, the future of the development has entered a new phase in which the council is actively seeking an alternate way forward, with a key focus on the determination of the current development agreement and leases.

2.11     This has become too much of a key issue to wait until the current deadline in 2014 and the possible extension to 2017. The continued failure to deliver gives the council no confidence that progress will made, and a rapid move to considering and deciding on alternatives is essential.

3.0       Corporate Implications

3.1       Financial and VAT

3.1.1    The primary long term impacts of choosing a specific course of action on the site and the costs of this need to be assessed as part of the risk analysis work as part of review by the Scrutiny task and finish group. In relation to this report the proposed support to seek initial high level commercial and legal advice can be met from existing budgets.

3.1.2    In addition to the legal risks involved with ceasing the current arrangements can be added the timescales involved in seeking an alternative proposal and the financial risks of this in comparison to the current arrangements and the potential return to the council.

3.2       Legal

3.2.1    It is not proposed to set out a full legal analysis of the situation at this stage as this will have to be considered in some detail through the Scrutiny process. However, a clear option as a course of action would be to seek the cancel the current development agreement and leases or not provide an extension to any timescales. As indicated above these courses of action are almost certain to be challenged legally, so any legal risk assessment through the Scrutiny process must assess the chances of being successful, the costs that may be involved, and the timescales to achieve the result in court.

3.3       Corporate

3.3.1    The future of the current development agreement development agreement and leases is seriously in doubt. There are risks associated with taking action about this, as set out in this report, but the repeated failure by the developer to move forward on site, despite the willingness of the council to assist, is no longer acceptable. As set out above, the failure to deliver has to change the council’s approach to this site development and its consideration of options for the future. This represents Cabinet’s entire dissatisfaction that the four month deadline it gave to the developer to resolve matters and make progress on site has not been met. Care needs to be taken in relation to considering options for the future as indicated above, but now is the time to take this step.

3.4       Equity and Equalities

3.4.1    The proposal in this report does not have any impacts on groups with protected characteristics.

4.0       Recommendations

4.1       That Cabinet supports the setting up of the Overview and Scrutiny Panel task and finish group, and advises that the following considerations should be taken into account in proposing a course of action for the council:

·     A focus primarily on the key issues to help guide the way forward for the council as a whole
·     Cabinet’s support for the work, including the cost of seeking confidential appropriate legal and commercial property advice
·     Consideration of action moving forward that may involve legal processes needs to be done in a way that does not prejudice the position of the council in a court action
·     Legal, financial and time risks associated with any proposed course of action are considered with care, including those associated with alternative developments
·     Seeking an expeditious result so that Cabinet can move forward on this site

4.2       That Cabinet expresses its strong dissatisfaction with the progress made by the developer in the last four months to move forward with this development, and signals a shift into a new phase of the development in which it wishes to see robust alternatives to the current arrangements being developed and acted upon by the council.

5.0       Decision Making Process

5.1              The proposed decision is within the council’s budgetary and policy framework.

Contact Officer:
Mark Seed, Director of Operational Services
Reporting to:
Sue McGonigal, Chief Executive

Annex List

Annex 1
Petition to Council 18th April 2013
Background Papers

Title

Details of where to access copy

None
N/A

Corporate Consultation Undertaken

Finance
Sarah Martin, Financial Services Manager

Update


The council have now published the details of the Pleasurama Site Development Review Task & Finish Group

Membership

·                 Councillor Peter Campbell   
·                 Councillor Ian Driver   
·                 Councillor Pat Moore   
·                 Councillor Richard R Nicholson   
·                 Councillor John Worrow   

49 comments:

  1. What Mark Seed is attempting to do is trick the Councillors to take full responsibility for yet another officer fiasco. He says that it needs high level legal input and then proposes that a task and finish group of Councillors make a decision. It is a decent barrister who should be advising the Council's lawyers from now on. Certainly not Councillors receiving even more flawed advice from Seed and McGonigal. Proper instructions to Counsel disclosing all the Council's previous cock ups is what is needed and now.

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  2. Agree with 11am: this is a simple cancellation of the contract now. 4 months have passed and the developer has done nothing again. A court would rubberstamp it within 5 minutes. Expensive civil servants drafting lengthy memos to cover their failures are not needed.

    The BVI corruption needs bringing into the open too.

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    1. You seem unaware that 199year leases have been sold on the Pleasurama site, and that simply stating that "this is a simple cancellation of the contract now" show a little naivety in relation to nuances contract law.

      With regards BVI, what is you you claim is corrupt? Surely you are not implying that simply having one's company registered in BVI is a corrupt action..

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  3. I guess the £3 million would have nicely paid the trans europa debt.

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  4. I agree with anon at 11:00.

    Additionally, I suggest that Mark Seed improves his written English. His report contains typos and bad grammar. For example, what does this sentence mean? " However, a clear option as a course of action would be to seek the cancel the current development agreement and leases or not provide an extension to any timescales." I can guess what he means but that is not the point.



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    1. From what I have read....the Council can cancel the existing devlopment agreement....and they can stop the developer from building......but they cannot take back the leases....so if TDC meddle it could be 125years before the site gets developed

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    2. I think you'll find it's 199 years Anon 9:26, other than that, I can't fault your post. I think you'll find that lengthy, doubtful and expensive compulsory purchase legal action would have to be taken.

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  5. time for the big BOOT

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  6. We will have to see if the Councillors fall for Seed's ploy, or if they kick it straight back to Patterson with an instruction to get good legal advice on how to get out us out of this appalling mess. The problem would then be if Patterson didn't disclose to the barrister what had gone on previously and if the Councillors concerned were big enough to admit that they are not lawyers and should not meddle.

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    1. I have no doubt that the developer would have certainly taken good QC advice....they alsways do...

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    2. Hope the council don't use the same barrister that advised them on banning live exports

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  7. Nice picture Michael, I never knew there was once a caravan park in from of Wellington Crescent. :-)

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    1. Readit it an artist’s impression of what the development should look like from the cliff top provided by the developer’s architect and published on the TDC planning website.

      I think the nub of the problem here is that neither the developer nor any of his representatives have ever managed to come up with anything more convincing in the ten years that they have had the opportunity to present their case for the development to the people of Ramsgate.

      It looks like something produced by an architect who was much influenced by the brutalist architectural school in about 1959.

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  8. It's great news that TDC is finally starting to act. However, it is clear to me that there should now be a full inquiry into how the council got into this mess. I would suggest that it isn't too bold to be asking for a Public Inquiry. In the meantime I agree with the posters who advise putting the matter in the hands of a barrister. Didn't he used to be an environmental officer?

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  9. For years all you Ramsgate nimbys have been telling us how there should be a flood risk assessessment, how the cliff is unsafe, how the foundations are set in crumbling chalk etc etc etc. I certainly got the impression you did not think the site was suitable for residential use, or much else for that matter, but, suddenly, now it seems to have gone belly up, you all want heads to roll, barristers to be called in and even a public inquiry. What exactly is it you want or do you not actually know.

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    1. Anon the text of the post is written not by me but the council officer in charge of dealing with the development.

      My stance on the flood risk is and has been, that before any development is planned there, there should be a full site specific flood risk assessment as called for by the environment agency’s costal defences technical specialist engineer.

      My stance on the cliff façade, is that because within months of the council’s £1m repair project it started to develop unexpected faults and needed further expensive repairs, it should be surveyed independently of the people involved in overseeing the £1m projec,t that us Thanet taxpayers funded.

      My stance on the position the council now finds itself in, is that I will do everything I can to help them extricate themselves from it with minimal expense.

      However I will oppose any development there that hasn’t been designed to deal with the very real difficulties associated with building between an unsupported chalk cliff and an unassessed 1860 sea defence on a shoreline with a history of storm damage.

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    2. I bet the Council will feel a whole lot more confident to kmow that you will save them from coughing up the 4million needed to pay back the developer

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    3. What Michael is saying is that he will try to stop any and all development unless and until it's proved that an event that has NEVER happened on the site to any other building, for the 150 years that there have been buildings on the site, will never happen.

      Much like spending an huge amount of money proving that I will never be hit by a satellite, but wearing a crash helmet 24/7 just incase it might happen one day, even though there is no evidence whatsoever to show that it will.

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    4. John this is not the case, what Michael is saying that before the plans are drawn up the risks associated with the site should be properly assessed by a competent expert and that the resultant plans are drawn up so they cover the risks associated with the site.

      Your argument is akin to saying “I don’t need an MOT because my breaks haven failed before.

      With the flood risks, some past events are recorded in the local paper, the 1897 storm demolished everything down there with the exception of the station building, this cleared the way for the construction of the pavillion.

      The 1953 storm swept a 12 ton crane into the part of the site where the existing plans show the location of an indoor children’s play area. Royal Sands would have been a much larger footprint than the previous buildings.

      The key however is that sea defence in front of the site, unlike all of the other ones in Thanet which are modern and regularly assessed and maintained by the EA, dates from 1860 and has not been assessed and maintained.

      The underlying problem being getting development finance for a new build on a high risk flood zone without a flood risk assessment.

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    5. I have to say that I wouldn't want to live in a house with a crumbling cliff behind me (look at the White Cliffs to the east of Dover if you want to see what happens to chalk cliffs when you have a cold snap) and an antiquated and unmaintained Victorian sea wall in front of me.

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    6. "John this is not the case, what Michael is saying that before the plans are drawn up the risks associated with the site should be properly assessed by a competent expert and that the resultant plans are drawn up so they cover the risks associated with the site"

      Sadly Michael that is exactly the case. Your analygy is fundamentally flawed. Your postition is more akin to insisting that an investigation be carried out in Alaska that ensure that the risk of heatstroke to polar bears is well understood and plans are in place for such an occurance, despite such an occurance NEVER EVER having occured. Interesting that the station, later Pleasurama managed to stand for 150+ years despite your dire predictions of Noahesq floods sweeping it away and the 1000's of people it contains!

      LOVE you crane story. That is also a laughable red herring of course. That would be like saying my car it TOTALLY unsafe as if a motocyvclist hits it at 100 miles an hour, he may crash through the windscreen!

      The DIRE risk to life and limb of seabourne cranes demolishing all before them, and causing widespread death and destruction seems to have been 100% mitigated by simply practice of not parking a crane on the beach! Tell us, how much of Pleasurmama did the crane demolish during it's little swim? If this is a danger, presumably the 100,000ton container ships in the channel are equally as dangerous! Presumably the whole beach shoudl be immediately closed off to prevent any risk to life until that DIRE danger can to suitably addressed!

      Clearly you have now a SHRED of evidence to support this wild claim "The underlying problem being getting development finance for a new build on a high risk flood zone without a flood risk assessment". A recession would seem to be the more likely and certainly more relevant consideration, but don;t let facts get in the way of a good little fairy tale!

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    7. What staggers me about the residents of this Island is that, despite most of them living within throwing distance of the sea, the majority of them have no comprehension whatsoever of its power and unpredictability. Hamilton is, of course, a world-renowned expert on the vagaries of nature, or is it maybe that he's the usual Thanet sub-species of troll, with a particular dislike of Messrs Driver and Child.
      I've just filled in my paperwork for this year's building insurance on my house. One of the questions is related to the risk of flooding - if you tick the "Yes" box you are directed to a pop-up; the first question is whether there has been an EA flood risk assessment. I wonder how the owners of apartments in Royal Sands would answer this and what their premiums would be.

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    8. It's a little thing called evidence Tim, I know that is a difficult work for you, would you like me to try to find an alternative word for you with less letters that you might be better able to understand? I have no problem with Michael at all. I do take issue with him on some issues, such as this and his support for the clown driver, but that is often the way with healthy debate. A shame you don't have the ability to debate intelligently.

      Tell me, how many times wash the station washed away by the sea in it's 150 year history? They would simply answer NO, just as the rest of the residents of Granville Marina have for many many years ;-)

      Clearly evidence AND insurance are both mysteries to you Tim. I look forward to learning how many times the station has washed away during it's history, That I'm sure will help quantify the "risk", when was the replacement station built as the original must have been washed away on several occasions at least, how many died when that happened?

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    9. You know that you have won an argument when the opposition resort to personal insults.

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    10. John, Tim, always a difficult one this, and in a sense it is similar to trying to explain the aquifer problem to the aquifer man. I will be doing an updated post on the development later today and will try to clarify the flood situation better in the new post, along with some new information about the development.

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    11. Excellent news Michael, if u could lets us know how many times the statiomn has washed away, and how many were killed, that would be very useful, thanks.

      Tim, "he's the usual Thanet sub species of troll" indeed i did know victory was mine, but i thank u for acknowledging that with such grace

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  10. What I want is not to have to pay for somebody else's mistakes. We are told that it might be expensive to extricate the Council from the contracts it has signed with SFP. Where is the accountability? The people who took the decision to sign these contracts have to be exposed and held accountable. Additionally, this evening we are being told that the Council will have to raid its reserves because of the unpaid money from Europa Ferries. Somebody on the council took the decision not to collect this money and to allow the ferry company to keep using the port without paying. This decision wasn't taken by the democratically elected councillors in a meeting of the full council. If it had been, we would have known about it and would have been able to object. If the taxpayer is having to pick up the tab for these c*ck-ups, then the taxpayer is entitled to the full picture of who did what and why, and the taxpayer is entitled to demand that those involved are removed. If they have already left the taxpayer is entitled to ask that money be clawed back; for example, from over-generous pensions or pay-offs. Perhaps our newly elected UKIP members might like to take up cudgels on our behalf?

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    1. Anon I think you may find that the head of the newly elected UKIP group instigated the relaxed approach to the ferry company, allthatsaid and considering that they port has been significantly under used since the Sally line departed, what else should the council have done? I don’t think there were any other viable ferry companies wanting to use the port, say that alternatively the council had told the ferry company to go away when they first got into difficulties, so there inst some other way that the £3.3m would have been paid to the council.

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    2. Michael, you are right that the Council should have exercised some discretion and delayed the due payments for a limited time, but not to allow that situation to drift along for so long and accrue £3.3M of debt. The report does not give a clear picture. We are not told for example when the ferry company first fell into arrears - what arrears there were when they asked for assistance - was a credible business rescue plan presented to the Council etc etc. There are a lot of questions that remain unanswered but it also remains the fact that Hart and Poole are those responsible for allowing this to drift on for over a year. Only goes to confirm that Cllrs should need to show some experience before being allowed to represent the taxpayer. I would also be interested to know when the Maritime Museum that Hart proudly boasted had all been agreed, is going to re-open. Doesn't appear to have been much activity since the opening.

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    3. Paul I think the key to this is that there were alternative operators, so the choice for both political parties was either the possibility of money from Transeuropa or the certainty of no money at all.

      The real answer here is to investigate other uses for the port, probably leisure related. Frankly there is too much unused port capacity in the southeast much of it closer to the continent. A mixture of fuel price rises and greater environmental controls means that Ramsgate is not likely to viable as a cross channel port in the foreseeable future.

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    4. Michael, I'm not sure there couldn't be another fuel efficient ferry crossing from Ramsgate to Dunkerk. Certainly 4 hours to Ostend is a nonsense for fuel costs reasons alone. Dover is still expanding so I am not sure there is that much overcapacity in the South East.

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    5. Paul
      1. Ramsgate to Dunkerque is not a lot less distance than Ramsgate to Ostende and there may not be the RoRo facilities at Dunkerque Ouest anyway since DFDS run a service there every two hours
      2. There is huge overcapacity in the short sea routes at the moment; two of the Dover ferry companies are competing with Eurotunnel and the third one is effectively owned by Eurotunnel. Dover hasn't built a new berth since 2004 and there are no plans to build any more in the Eastern Docks. The Western Docks development is on hold so I don't know where you get the idea that Dover is expanding.

      I do agree with you over the Maritime Museum. Hart is all mouth, keen to tell everyone how good he is on Twitter (although I note he doesn't mention his swimming too much nowadays)and in the Gazette but only really demonstrating that an ex-NHS electrician really isn't up to the job of running the Council.

      Michael. I think we would be foolish to put all our eggs in the leisure boating market. There is probably still room for an operator to run unaccompanied trailers to Zeebrugge or alternatively the port could look towards a more traditional coaster trade; I suspect that an entrepreneurial type could make use of the congestion at the Thames Crossings to run a service between the east coast and Kent

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    6. That's what I was thinking, perhaps they should be looking at other UK destinations instead... and while we're at it can we bring back the Harty ferry? This 1 mile crossing is nearly 30 miles by road!

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    7. LOVE the Harty Ferry, many a fun weekend at bike rallies of yesteryear, and some GREAT lunches there recently!

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  11. Michael. The possibility of money or certainty of none is NOT the issue here. You may be right that this was the dilemma faced by the council. But, it is now clear that there were serious financial implications for the taxpayer. We need to know who took the decision to hide this from the majority of councillors. Either we live in a democracy or we don't. It is arrogant and undemocratic for someone (elected or not) to decide to rack up debt for the taxpayer and to do this in such a way that the taxpayer is unaware until it is too late. It is too easy to say that the council was in a Catch 22 situation. Neither you nor anyone else can know for certain what would have happened if the council had decided not to allow the debt to continue mounting. Maybe the company would have come up with the money. Maybe they would have shut down and another company would have taken their place. Maybe they would have shut down and an alternativer plan for the port would have developed. As things stand we have wasted three years subsidising a business to no useful effect. There are hundreds of successful profitable businesses in Thanet. They don't receive subsidies. Maybe, if this money had been spent on them instead we would have seen a substantial return. And before any clowns pop up saying that this money never existed so you can't miss it, take a look at your council's accounts. If it appears on your balance sheet it's real and you don't have to raid the reserves to pay a debt that doesn't exist.

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  12. This comment has been removed by a blog administrator.

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    1. Anon you need to lay off adding the names of real people, in this case Councillors to your speculations, or better still start your own blog and accuse real people of courruption there under your own name.

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  13. Peter,

    What is or was the Harty ferry?

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  14. A ferry that went to a place called Harty Ferry in Kent, google it (as with "Grove Ferry" just outside Thanet, the place has kept it's name despite there no longer being a ferry there!).

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  15. I have it on very good authority,from a very reliable and trusted source that the funding for the Royal Sands project is fully in place and that the contractors are ready to make a start on site very soon.An agreement with the Council is close to being signed, bravo to the current council group for making this happen....
    Great news for the Town.
    And much needed employment for the local construction industry.....jobs jobs jobs....HAPPY DAYS

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    1. 8.13pm.....that is good news....

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    2. I just saw a couple of pigs fly past!

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    3. Yeah, right. Who are you, anyway.

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    4. In The Know = Clive Hart

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    5. In The Know,

      I realise know that you are probably taking the - oops, being ironic.

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  16. Oink,oink, oink

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  17. I reckon In the Know might well be correct.

    I work for Bretts and we recently priced up the concrete needed for the job. There is an enormous quantity of concrete, my sales manager was somewhat excited.

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