Further Pop Factory probe

Jan 28 2008 by Martin Shipton, Western Mail

A CONTROVERSIAL project aimed at bringing pop music production to the Valleys is facing a further investigation, it was confirmed last night.

The Pop Factory, at Porth, was set up when Avanti Media Group received £4m from the former training quango Elwa in 2002 to transform an old supermarket into a new music and TV training centre.

A year later Elwa was accused of serious management failings in a damning report from the Assembly’s audit committee.

The report said the quango – which was “merged” with the Assembly Government in 2006 – was guilty of serious failings in regard to several projects, including the Pop Factory.

Half the £4m European aid money given to the Pop Factory was not spent and later repaid.

Now a further report, which has not been published, has identified further problems.

An Assembly Government spokesman said, “A forensic accounts report has investigated the facts relating to the Elwa contract with Avanti and there are a number of issues, which mean this is now being referred to the European Commission. Elwa acknowledged there was a problem in its dying days and passed a resolution requesting that the Assembly Government refer the matter to the European Commission. We are unable to comment on the findings of the forensic accounts report because this may be prejudicial to any possible legal proceeding and investigation by the European Commission.

“Elwa’s own financial procedures were significantly tightened up in 2003 following the Audit Office report into the Pop Factory.”

A spokesman for Avanti Media Group said it found out about the referral to the European Commission only on Thursday.

The firm said it had been working with the Assembly Government “to bring any issues raised by them to a satisfactory conclusion”.

Avanti, said the spokesman, had “always been entirely open” with the Assembly Government about dealings with Elwa and the conduct of the contract.