Council bosses have rejected claims that Newcastle’s Grainger Market is being privatised, after they were forced to bring in an outside management team amid a civic centre staffing crisis.
Real estate consultants Knight Frank are set to take over the day-to-day running of the historic market from Newcastle City Council. However, despite accusations that the move could set a “dangerous precedent” by handing over one of Tyneside’s most prized assets, local authority chiefs assured councillors on Tuesday that the council will retain control of the site.
The Grainger Market’s financial struggles have been no secret over recent years, most recently reporting a £377,000 shortfall against its budget for 2022/23, though the recent completion of its over-running and over-budget roof renovation has brightened the mood. And council bosses now say that an exodus of staff from its property team means they can no longer run the market as it should be.
The centre, which has stood at the heart of Newcastle since 1835, is also due for further renovations after a successful bid to the Government’s Levelling Up fund, a project that Knight Frank will also take on responsibilities for as well as matters such as stall lettings and rent. Furious independent councillors from the outer west of the city spoke out against the decision to award the company that contract this week, launching a call-in challenge at a meeting of the council’s overview and scrutiny committee on Tuesday afternoon.
Chapel ward representative Marc Donnelly said that the Grainger Market should be a “key priority within the council, not handed for running by a private business” and expressed fears that a “privatisation” will set a “dangerous precedent for the outsourcing of other council-owned properties”.
He added: “We are the largest landlord in the city, but it worries me immensely that we are saying to the public at large that we cannot manage our assets. That is alarming because a lot of taxpayer money has been invested in those assets.”
Alex Hay, Labour’s cabinet member responsible for the council’s property portfolio, told the committee that 14 staff had left the authority’s property team since 2020 – taking a collective 260 years of experience with them. He said that Knight Frank would be brought in on a two-year basis to ensure the market runs with “business as usual”, adding that the firm was taking a fixed fee from the council and had no means of using the Grainger Market to generate extra profit for itself.
Coun Hay insisted that the switch was essential to “ensuring that the market remains sustainable” and “does not signify outsourcing or privatisation.” The council’s head of property, Paul Stewart, added that the authority “still has full control” of the Levelling Up project, with Knight Frank “providing the additional capacity that we desperately need” to deliver the £9m upgrades.
Scrutiny committee members were satisfied with the council’s reasoning and unanimously agreed that the contract award did not need to be referred back for further deliberation, with Liberal Democrat Greg Stone calling it a “sensible and viable way forward” for the Grainger Market. Colleague Wendy Taylor added: “Coming into this I was really concerned about the idea of a private company taking over the market. But I do feel reassured that this is the company managing the market on behalf of the council.”
A council spokesperson said afterwards that market traders wanted a “more visible” management presence that the council no longer has the capacity to provide. They added: “In order to do so, we are looking to appoint a managing agent to give improved visibility and response to traders and the public.
"This will be for two years only, after which there will be an opportunity to review and agree next steps for the future of the market. We will continue to communicate further with traders. We would like to reassure them that the managing agent will maintain an appropriate tenant mix and the council will continue to make all material decisions throughout the contract.”
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