'Why can't we be paid for the work we've done?'

Contractors who worked on a £2.89m government-funded renovation project have said it is "disgusting" they have not been paid for all their work.

Work to create a community space at The Life Factory in Glastonbury paused in 2024 after Somerset Council had concerns about its progress and stopped releasing funds to Red Brick Building Centre, which was responsible for the project.

The BBC understands about 15 creditors are awaiting payment, including one who claimed he is owed about £380,000. He described the impact as "catastrophic".

Somerset Council said the situation was "regrettable", while the Red Brick Building board said it had been liaising with creditors to "work out what to do".

Keith Jackson is director at TML Building Services, which was contracted by Beckery Construction Company (BCC), a subsidiary of Red Brick, to carry out structural works at The Life Factory.

He told the BBC he had not been paid since January 2024 and claims he is owed about £380,000 for work, including removing the floor and roof.

"We never knew the project was in trouble until a halt was called," he said.

"Why can't we be paid for the work we've done? Why should we suffer for other people's incompetence?"

He said the situation had a "terrible effect" on his company.

"We haven't got any finances," he explained. "We've got several jobs we could go to, but we don't have the money to go.

"We owe other subcontractors a considerable amount of money, but also it's taken our future away."

Funding to develop the community and learning space was awarded to Red Brick Building Centre, a social enterprise, under the Glastonbury Town Deal.

South West Audit Partnership (Swap) is looking into what went wrong. In a report, it said it had "no assurance" sound governance or financial controls were in place at Red Brick Building or Somerset Council.

Swap also found "no evidence" of a plan to deliver the project "within budget, scope and on time".

The report said BCC was set up to keep costs down, but confused the relationship between parties which lead to a communication breakdown, poor governance and a lack of accountability.

Auditors also found standard HR procedures were not followed at BCC, including around sub-contractor recruitment and timesheet records.

J&E Construction SouthWest was also contracted by BCC to renew the internal floors and roof structure of The Life Factory.

Its director Tom Popham claimed he is owed a significant sum in unpaid invoices.

He said the situation put a "huge strain" on him, but a loyal client base and his other business meant he was able to pay his contractors and suppliers.

However, he said the company is now facing "slow growth".

"We haven't got the money in the bank that we used to," he added.

He described the council's decision not to release more funds as "disgusting".

"I have lost all faith in Somerset Council," he said.

"I do think they [the council] should settle up if we can prove what we've done."

Somerset Council said: "It is deeply regrettable this is having an impact on local contractors with legitimate claims, but we are not contractually responsible for any payments to them."

It added the Swap report confirmed the council's concerns about the project and made it "clear" it "cannot release further payments".

In a previous statement the council's chief executive Duncan Sharkey said the authority accepted its monitoring of the project "could have been strengthened".

A new board started operating at Red Brick at the end of 2023 and its chair Indra Donfrancesco said it is "heartbreaking" contractors have not been paid.

"There hasn't been a day in this last year where we haven't been trying to work out with them what to do," she added.

"It is absolutely devastating on every level."

A statement from the new Red Brick board said the previous leadership set up BCC in 2022 to manage the scheme and appointed a full-time project manager. 

It claimed there were "serious" procedural and reporting "failures" and said: "In hindsight, both Red Brick and Somerset Council lacked the capacity to provide proper oversight".

Ms Donfrancesco said the previous Red Brick board should have had more of a "financial forecast" of where money was going, what the project would look like and the contractors involved.

John Capper, one of two former directors of BCC, said in a statement that Red Brick's board signed the funding agreement and so responsibility lies with them.

He said the project manager, who was also a BCC director and full-time employee of Red Brick, was "managerially responsible" for the project's delivery and the "reporting and adherence" to procedures.

"He reported on a regular basis to the Red Brick board as overseers of the project," Mr Capper added.

He said that, during his time as a director, "no concerns" were raised by the council or Red Brick board regarding the issues in the Swap report.

"However, I did raise my own concerns with the Red Brick board and the Somerset Council officer, which is the reason why I left," he added.

Robert Poizer, the other BCC director and the project manager, declined to comment until the audit process is complete.

Ms Donfrancesco said the new board will work with the council to try to find a way to satisfy the funding agreement.

"Should an alternative viable plan for regenerating the derelict building come to fruition over the coming months, the remaining funds could still be released," she said.

Meanwhile, audit work continues. A Swap report found a considerable sum is due to be paid to contractors and creditors, but said the amount was unconfirmed as some costs could be ineligible and some invoices are in dispute.

At a recent council meeting, auditors described the work as complex and could not give a timeline as to when it will be complete.

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