HEREFORDSHIRE Council finance chiefs have told bosses in Shropshire that they will not be repaying the £3.8m grant spent on the southern link road project.

Shropshire Council’s chief finance director James Walton had written to his counterpart in Herefordshire on July 20 asking for the funds to be repaid within 20 days.

They believe that Herefordshire Council’s progress towards delivery and completion of the South Wye Transport Package has been unsatisfactory.

This transport package includes the proposed road which would link the A49 Ross road and A465 Abergavenny road south of Hereford and is currently under review.

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In February 2016, Shropshire Council, on behalf of the Marches Local Enterprise Partnership, entered into an agreement to make £27m available for Herefordshire Council’s transport package.

Herefordshire Council has since drawn down £3.8m in the form of grants to pay for work on the scheme.

But bosses in Shropshire believe the progress has been unsatisfactory and it constitutes a termination of the grant agreement.

Because of this, they wish to claw back the funds paid to Herefordshire Council.

However, Andrew Lovegrove, Herefordshire Council's chief financial officer, said there is currently no requirement to repay the grant.

“Herefordshire Council do not agree that progress towards delivery and completion of the South Wye Transport Package is unsatifactory as the council has continued to pursue the objectives and oucomes of the SWTP within the funding period and has continued to provide updates on the SWTP as required under the terms of the grant agreement,” he said in his reply last month.

“Therefore it would not be reasonable for Shropshire Council to conclude progress on the project has been unsatisfactory to date.

“On the basis that none of the termination and clawback events in the Appendix 6 of the grant agreement have occurred no right of termination arises under clause 7.2 and there is no requirement for Herefordshire Council to repay the grant paid to date.”