Flanagan Group, a construction firm with ties to Len McCluskey, general secretary at the trade union Unite, has been paid £95m for a hotel project that was supposed to cost “in the region of £7m”.
The Times has reported that the development of Unite’s flagship Birmingham site would provide Flanagan with over £15m profit.
The body remains adamant that the hotel contract was awarded to Flanagan after the “strictest competitive tendering process”.
However, questions on the scheme that was delivered late and over budget are expected to be raised at today’s (29 January) union crisis meeting called by McCluskey to discuss the hotel development.
Despite Unite’s rejections of claims that the project has racked up costs well over budget, the Times has reportedly seen confirmation that the spending on the complex has already reached £96.5m, with £94.9m directly funnelled to Flanagan.
Previously described by McCluskey as a “working-class family who have made good”, Flanagan has recently been placed under criminal investigation in a corruption inquiry surrounding the sale of council-owned land in Merseyside.
Gerard Coyne, a competitor of McCluskey who was defeated in Unite’s 2017 leadership race, has urged the union to “embrace transparency”.
In an open letter to Unite’s 1.1 million members who contribute an annual £150m to the body, he wrote: “Unite needs fundamental change to become much more transparent and accountable. The most obvious question is whether members’ money has been spent wisely.”
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