An independent inquiry has been ordered into the Unite union’s spending on its Birmingham hotel and conference centre.
Unite general secretary Sharon Graham said she would appoint a QC to investigate the cost of the project after the development was valued at “considerably lower” than the cost of construction.
Graham warned members of a “potentially significant loss” from the development of the 170-bedroom hotel and 1,000-person conference centre, which was intended to make the union a tidy profit.
Flanagan Group, a Liverpool company owned by an associate of Unite’s former leader Len McCluskey, was paid £95m to build the scheme. The project was initially supposed to cost £7m, before estimates were revised to £35m. In reality, £57m had already been spent before construction even began.
A recent “expert valuation”, however, estimated its value as being “considerably lower than the costs incurred in developing the site”.
