Diana welcomes UK Government move on Derwenthorpe

8.00.00pm GMT Sat 7th Nov 2009

York's Liberal Democrat Euro MP, Diana Wallis, has welcomed the move by the UK Government to save one of York's biggest proposed housing developments and to avoid a costly and embarrassing court case.

As reported in the York Press, Government officials have made their keynote submission to the European Commission, explaining why no tender process was carried out at the site of the proposed Derwenthorpe model village, in the village of Osbaldwick and saying what action they have taken to avoid a repeat mistake.

The York case has become a landmark one, with the UK Office of Government Commerce (OCG) writing to every council in the country, giving fresh guidance on how to handle such developments.

The City Council and the OCG were carpeted by Commission officials earlier this year over the 2002 land deal between the council and Joseph Rowntree Housing Trust (JRHT).

The Commission said the council should have carried out a tender process with other developers, rather than allocating it straight to JRHT, and said that unless the Government offered an adequate explanation the case could be referred to the European Court of Justice.

Diana who has been working closely with Council leaders said:

"I welcome the fact that the Government had now written to the Commission responding to their issues. The Commission will look at it and the hope is that they will see that the necessary actions have been taken and that the response is appropriate. I hope that this can then be put behind us and work can start on the Derwenthorpe project next year."

The City of York Council and the Government must now wait for a ruling by the Commission before they know whether to proceed with Derwenthorpe or prepare for a court date. If a decision was made by Christmas, work on Derwenthorpe could begin by next March. The council has already spent tens of thousands of pounds on the dispute, with Leeds-based law firm Shulmans recruited to offer expert legal advice.

(Photo shows Diana meeting with Council Leader Andrew Waller)