As one of the rulers of an autocratic kingdom that has an appalling reputation for repression and an addiction to oil revenues, Sheikh Mansour stood to gain so much from this partnership. It was the council that held almost all the cards: the hectares of publicly owned land, the planning regime, the public subsidies. Yet somehow, according to new research shared exclusively today with the Guardian and authored by academics at Sheffield University, it was Sheikh Mansour who pocketed
almost all the winnings. The report says that nine sites were sold to the sheikh at a fraction of their value, and well below what other plots nearby fetched (the council says it used independent experts using standard valuations, although it won’t give any more details). They were on leases lasting 999 years, well beyond the norm. And the fund shifted what had been public assets to companies registered in Jersey.
That walk along the water from New Islington into Ancoats now passes blocks of privatised land owned in an offshore tax haven, which yields millions upon millions for a key member of the wealthy elite running a
surveillance state halfway across the globe. One of the greatest cities in the world has sold itself to a senior figure in a brutal autocracy – and not even for a good price.
This is the devastating implication in the first thorough study of the Manchester Life scheme, which is a product of months pouring over company accounts and planning applications. The city council is sometimes keener to criticise its critics than to hear what they have to say: Leese, its leader for 25 years until 2021,
once responded to those calling for more affordable housing as “middle class tosspots and I hate them”. So let us knock on the head any personal attacks: the experts have all lived in the city for decades, I am one of the independent and unpaid advisers on the advisory panel, and this is a report issued squarely in the public interest.
Among a political establishment still scratching its head over
how to level up, Manchester is celebrated as a pioneer. Its Labour leadership has been praised by Conservative administrations, while Osborne called its chief executive, Sir Howard Bernstein, “
the star of British local government”.
Bernstein ran the council for nearly two decades until 2017, and sat on the board of Manchester Life. Yet its success has come at a high price for the little people who just happen to live in the city. Not only have the assets they owned been sold cheap, they have got little back. The nine developed sites have no social or affordable housing, which the council’s planning officers justified with statements such as: “There is already a high level of affordable housing in the immediate area.” The same council admitted earlier this year that nearly 4,000 of the city’s children sleep each night in
temporary accommodation.
At the Manchester Life developments, a two-bed flat is considered a bargain if it goes for £369,000 – a price that puts it off limits to
couples working full-time on an average salary. As for tax, the sums paid to the Exchequer seem risible. One of its main subsidiaries earned more than £26m in the five years to 2021, but, the researchers found, paid less than £10,000 in tax – an effective rate of just 4p on each £100 of revenue
. Manchester Life told me that its subsidiaries “pay all UK corporation or income tax due on rental income and profits”. It would not, however, disclose how much tax it pays or on how much revenue.
It is right to say that New Islington and Ancoats are vastly more pleasant areas than they were even five years ago – but the big question is who has won from redevelopment and who has lost. Putting hard numbers on that is tricky when so much of the information about
Manchester Life – a venture using public assets and public subsidy with a public authority – is kept strictly private.
https://www.theguardian.com/comment...st-built-homes-europe-extreme-weather-upgrade
I asked the report’s authors to calculate how much the council could have earned from this deal. Looking at examples of other land deals and other local councils, their conservative estimate is £33m, plus up to £1.7m a year in rent. Both the council and the joint venture described that sum as “speculative”. The council also said it expected more money to come through an overage or profit-share arrangement, although it did not provide any details of this agreement nor are they on public record. But for comparison, that £33m would
more than cover what the city pays in a year to put up families in temporary housing.
Sheikh Mansour will presumably know exactly how much Manchester Life is netting him – and can look forward to 10 centuries of rental income from the land in this great city. He seems content with the arrangement. A few months after Bernstein retired from the council, he was appointed as the senior strategic adviser for City Football Group, owned by
Sheikh Mansour. I asked the council what procedures it followed on Bernstein’s subsequent appointment with such an important business partner. It could not tell me.
