Cornwall Council has refused to continue working on the Penzance to Scilly Isles sea link following a ministerial u-turn on funding.
In an open letter the council said it had spent £6m on plans to ensure continuing passenger and freight transport between Penzance and Scilly Isles before ministers said the scheme was too expensive.
Graeme Hicks (Ind), cabinet member for transport and highways, said he was “very disappointed” by the decision.
“Having worked under the guidance of the department over the last eight years to develop this project at a cost of nearly £6m, it is particularly frustrating to now learn that the project falls well short of what the department now requires.”
In his letter to the department, Cllr Hicks said transport minister Norman Baker’s claim that the scheme was set to cost the government “over £35m” was incorrect and based on four-year-old cost estimate. Since that time local contributions had increased by 50% to reduce the bill to central government to £32.3m, Cllr Hicks said.
The minister’s objections to the scope of the project were a complete turnaround since 2009, Cllr Hicks continued, when an independent review of the project commissioned by the DfT judged the project to have been correctly specified and value engineered.
Cllr Hicks said the minister’s decision meant the loss of £27.75m of European funding and council borrowing and would leave the scheme entirely dependent on central government and private sector financing.
Cllr Hicks wrote: “Given the changes that now appear to be required, I would respectfully request that the department lead any future work on the project. This will ensure that the scope and approvals for any revised proposals are developed in an efficient and cost effective way.
“Whilst the council is unable to support the cost of any further work on the project, we are prepared to provide access to any technical information we have built up over the last eight years of the project.”
He added: “It would be helpful for the stakeholders who may now wish to be actively involved in developing a new project, if the DfT defined the scope of the revised project as soon as possible.”
A DfT spokesperson said: “The department has already been clear that it recognises the importance of a sea connection, both for passengers and freight between Penzance and St Mary’s. However, as set out in March, we have decided that we cannot support the allocation of over £35m of departmental funds (£62m of public money in total) for a scheme that is very poor value for money, particularly at this time of fiscal stringency.
“The department has already stated that it believes the scheme proposed by Cornwall Council goes beyond what is necessary to maintain services and is concerned the cost of both the boat and the harbour works have risen by 50% since 2007.
“We will consider the points raised in this letter from Cornwall Council and will respond in due course.”