As Bristol Beacon finally reopens, how did the refurb end up costing £130m and could it have been avoided?

At a time when councils are strapped for cash and spending is being cut across the city, how did the project to refurbish the city’s flagship music venue spiral out of control?

Photo: Matty Edwards

Reports 30th November, 2023

Matty Edwards

Today, Bristol’s premier music venue will reopen to great fanfare. Bristol Beacon, formerly known as Colston Hall, closed its doors five years ago, but will now welcome audiences again. 

That’s thanks to a once-in-a-generation refurbishment that the Beacon’s PR deems “a defining moment of cultural transformation for the West of England” that “truly confirms Bristol’s reputation as a world-class music city”.

The catch? This makeover will cost £84m of taxpayers money – compared with the £10m first planned. At a time when every aspect of council spending is put under a microscope for potential savings amid a national crisis in local government finances, spending on this project has spiralled out of control. In case you needed any more proof of how serious the national crisis is, yesterday Nottingham City Council joined the list of authorities that have declared effective bankruptcy. 

Bristol City Council is currently consulting the public on plans to cut £20.3m from next year’s spending as part of an incredibly gloomy picture for the authority’s wallet in years to come. The council’s bill for Bristol Beacon is roughly equivalent to the projected gap in the annual budget over the next four years. 

When the council’s lack of money crops up in almost every story the Cable writes, from plans to cut £3m next year from support for people who can’t afford their council tax bills, to the evacuated households of Barton House having to continue paying rent to the council despite having to live in hotels, it begs the question: how did we manage to splurge more than £80m of public money on Bristol Beacon? And could the spiralling cost have been avoided?

How did it end up costing so much?

In May 2018 when then-called Colston Hall closed its doors to the public, the refurbishment project was originally estimated to take two years at a cost of £48.8m. 

There had been limited exploration of the condition of the building before the construction contract was agreed. There was also a desire to get on with things because closing the city’s biggest concert hall was a big deal. 

This meant that the full extent of the refurbishment work was not known until work had begun in 2020. The ballooning costs were due to unforeseen structural problems with the Grade-II listed building that were uncovered during demolition works. It turned out the true extent of what was required far oustripped the worst case scenarios mapped out in 2018. 

The total cost of the project increased to £52.2m in June 2019, £106.9m in March 2021 and in January 2023 to £131.9m. Of this £131.9m, the council will have to contribute nearly two third of the cash – £83.9m.

It’s important to remember that at various points when the council decided to plough on and spend more money, the other options would have cost even more and opposition councillors did lend their support. 

What could the council be spending the money on instead? 

The council has defended the decision to press on with the project, which if delayed or abandoned would have cost even more money. And it has stressed the money it will generate for the local economy, which BMT claims will be £13m a year. This is on top of the social and cultural value of the venue itself, as well as the Beacon Music Centre, a music education hub in Southmead run by BMT.

But at the same time, the council will now be paying £2.3m a year for the next half a century to pay off the loan that covered the bill for the refurb. When cultural venues are struggling elsewhere in the city, and the council’s budget is being trimmed all over the place, £2.3m could have a big impact if it was still in the local authority’s wallet. 

In July, people working in Bristol’s arts sector marched on City Hall after the council delayed the decision on whether the renew funding for the sector until March 2024. And yesterday, independent cinema Watershed announced the council would no be renewing its funding next year either.

Here are examples of council spending that put the loan repayments in context:

What could have prevented the overspend? 

In 2022, external auditor Grant Thornton said that the construction contract placed responsibility for risk of design development and the condition of the building on the council. 

Auditors said there was limited exploration undertaken to understand the extent, scope and condition of the building before the contract was agreed, which meant the full extent of the work and costs was not known until 2020.

“In our view, the council underestimated the complexity and difficulty of the redevelopment and did not have effective arrangements in place throughout 2020/21,” the audit report said. Better project management would have made sure the council was aware of the escalating risks sooner, which would have reduced the cost. 

But auditors also said that the council did improve its management of the project in 2021 when it brought on consultancy firm Arcadis as a strategic partner.

“The council should learn from the Bristol Beacon project and ensure all capital projects have effective and rigorous project management arrangements in place,” Grant Thornton said.

In their 2023 report, Grant Thornton made this recommendation more strongly: “The Council should urgently undertake a lessons learned exercise on its refurbishment of Bristol Beacon,” they said. “The lessons learnt exercise should not be delayed until completion of the project, as the lessons learnt could be applied to ongoing and new capital projects.”

In response to this recommendation, the council said this lessons learnt exercise started in June 2023, would be led by an independent team from Arcadis, and would be published in February 2024.

Martin Fodor, an experienced Green councillor who sits the Overview and Scrutiny Board, said: “If there had been a detailed structural survey it could well have revealed some if not all the extra complications much earlier. This would have been an expensive preparatory approach but for some reason wasn’t taken. 

He added that this would have meant a higher cost project from the start, but this could have led to a different agreement with funders so that less of the financial burden fell on the council. 

“How the contract was structured could reveal more lessons for future, complex projects where risks are high,” Fodor said. “A contract with enough trigger points would flag each problem earlier. 

“I’m only aware of a couple of occasions when the administration in charge brought the issues to the attention of scrutiny,” he said. “Under a committee system from next year more people would be directly involved in how each decision gets reached, not just in commenting on reports already well on their way for a Cabinet decision.”

Andrew Brown, the chair of the Audit Committee, said: “The Bristol Beacon and the Bristol Music Trust are a key part of the cultural infrastructure and offering of the city, and it is vital that the re-opened venue is a success. However, we cannot escape the fact that, at a time when the council’s revenue budget is being squeezed, many residents are questioning how so much money could be made available to just one project.

“As chair of Audit, I believe we must get to the bottom of how the process was managed, including how so much of the required work wasn’t identified initially, why the council is responsible for such a large share of the spending, and how this experience could inform future infrastructure projects. 

“I also want the new agreement with the Bristol Music Trust to have appropriate oversight from the council and for it to be kept under review to ensure that it is fit for purpose and that the council gets at least some return on the money spent.”