[🌎 Universal GB] General Discussion

[xtpower]

Tbh I’m not too bothered about the government bunging them some cash, it happens all the time. The huge tax incentives for our film industry goes into the billions (probably one of the reasons why universal chose the UK) and that’s why most huge blockbusters are filmed here, we’re on track to overtake Hollywood by 2030z

I can’t see Merlin objecting tbh, they should however be asking for their own deals. Every local around Towers would appreciate an upgrade to the road network around the park as I’m sure visitors would. Hopefully they start asking for things like that.

I can just imagine Merlin asking for £500m in infrastructure upgrades and being asked in return, 'Are you going to be investing £5b+ like Universal?'

 

[jon81uk]

Tbh I’m not too bothered about the government bunging them some cash, it happens all the time. The huge tax incentives for our film industry goes into the billions (probably one of the reasons why universal chose the UK) and that’s why most huge blockbusters are filmed here, we’re on track to overtake Hollywood by 2030z

Thats a different way of bunging them some cash. The production companies get a tax break for production in the UK.

Whereas for the Universal project we are talking about building a station (which was going to be built anyway, but now it needs to be bigger) with some other road upgrades and some roads.

 

[Blackrock]

Thats a different way of bunging them some cash. The production companies get a tax break for production in the UK.

Whereas for the Universal project we are talking about building a station (which was going to be built anyway, but now it needs to be bigger) with some other road upgrades and some roads.

Ultimately it’s all to support jobs, tax breaks is free cash. The second order effect of this park being built means the local area is going to look completely different in 30 years time. More jobs, more homes, more businesses. Business’s that probably never would have looked at Bedford or potentially the UK before this. That all means the treasury and the bean counters are going to have more money, it’ll pay itself back.

Worth it imo.

 

[jon81uk]

I can just imagine Merlin asking for £500m in infrastructure upgrades and being asked in return, 'Are you going to be investing £5b+ like Universal?'

Although there has in the past been road infrastructure improvements that have directly or indirectly helped Alton Towers and other parks.
£190million was spent on roundabouts and new roads near Uttoxeter that significantly benefitted JCB and Alton Towers https://www.highwaysindustry.com/staffordshire-wins-pinch-pot-road-improvements/

 

[xtpower]

Doing a re-read of the archived discussions just to see how sentiments started and changed as things progressed. Poor Matt.GC really missed the mark on pretty much all his posts lol. But was nice to see that quiet hopefulness from plenty of posters get rewarded as things went along.

 

[GooseOnTheLoose]

Tbh I’m not too bothered about the government bunging them some cash, it happens all the time. The huge tax incentives for our film industry goes into the billions (probably one of the reasons why universal chose the UK) and that’s why most huge blockbusters are filmed here, we’re on track to overtake Hollywood by 2030z

I can’t see Merlin objecting tbh, they should however be asking for their own deals. Every local around Towers would appreciate an upgrade to the road network around the park as I’m sure visitors would. Hopefully they start asking for things like that.

Comparing the Audio-Visual Expenditure Credit to the Universal infrastructure deal is a false equivalence. Film tax relief is a systemic, industry wide mechanism. It is a set of rules available to any player, be it Disney, the BBC, or an independent production company, provided they meet the criteria. It creates a level playing field to stimulate a sector.

The Universal deal is a bespoke, targeted subsidy. It is the equivalent of the council agreeing to build a private slip road for your house because you promised to host expensive dinner parties, whilst telling your neighbours they have to pay for their own dropped kerbs.

The Universal deal is a specific subsidy. The government isn't building train stations for every theme park that invests £X billion. They are doing it specifically for Comcast. That is the definition of market distortion.

I can just imagine Merlin asking for £500m in infrastructure upgrades and being asked in return, 'Are you going to be investing £5b+ like Universal?'

Merlin isn't asking for a £500 million handout. They (via UK Hospitality) have been asking for a VAT reduction to 12.5% for the entire industry. That would benefit the local B&B, the independent zoo and the seaside pier just as much as it benefits Alton Towers.

The government said "no" to helping the entire sector, but "yes" to buying a train station for an American conglomerate. That is why the optics stink.

Although there has in the past been road infrastructure improvements that have directly or indirectly helped Alton Towers and other parks.
£190million was spent on roundabouts and new roads near Uttoxeter that significantly benefitted JCB and Alton Towers https://www.highwaysindustry.com/staffordshire-wins-pinch-pot-road-improvements/

The A50 Growth Corridor Project A was primarily designed to support JCB (one of the UK's largest exporters) and unlock land for 700 new homes. Alton Towers benefited incidentally because they happen to be down the road.

The upgrades at Wixams and the A421, in addition to the entirely new station at Stewartby, are being engineered specifically to handle the capacity requirements of the resort. They are not incidental; they are conditional.

Doing a re-read of the archived discussions just to see how sentiments started and changed as things progressed. Poor Matt.GC really missed the mark on pretty much all his posts lol. But was nice to see that quiet hopefulness from plenty of posters get rewarded as things went along.

Being glib toward members is generally frowned upon, especially when they're not regularly here to defend themselves. I think it's also a little uncouth to take a victory lap based purely on the benefit of hindsight.

@Matt.GC is a valued and essential member of our community, whose perceived "pessimism" is usually just well calibrated realism born of professional experience. He applies business logic to situations which are often driven by emotion and hype.

To mock him for failing to predict that the government would bypass standard planning procedure and write a blank cheque to force through a vanity project is uncharitable. Cynicism is the default state for those of us getting a little grey around the temples (or feathers, in my case) and frankly, given the history of failed UK theme park projects, it was the only sensible position to hold until the ink was dry.

It is incredibly easy to say "I knew it all along" when you have the answer sheet in front of you.

 

[jon81uk]

The A50 Growth Corridor Project A was primarily designed to support JCB (one of the UK's largest exporters) and unlock land for 700 new homes. Alton Towers benefited incidentally because they happen to be down the road.

The upgrades at Wixams and the A421, in addition to the entirely new station at Stewartby, are being engineered specifically to handle the capacity requirements of the resort. They are not incidental; they are conditional.

You could of course look at it as a £190m subsidy for JCB then.... I know realistically the road improvements didn't just benefit JCB or Alton Towers or the new housing, its a mixture of everything. But just balancing that transport improvements are often not just about one thing (although in the Universal case a lot of the road infrastructure is only because of the theme park).

The government isn't building train stations for every theme park that invests £X billion. They are doing it specifically for Comcast. That is the definition of market distortion.

They were going to spend at least £62m on the train station anyway, I expect if that wasn't already planned for it would be a diffferent situation. The spending on the station is needed due to the new housing in the area anyway. So in a way it is similar to the above example where housing and JCB benefitted, except this time it is housing and Universal.
Also is anyone else looking at investing billions in a theme park? We've got nothing to compare it to as no new major theme park has been constructed in the UK. Legoland Windsor was probably the last major one and that was previously a safari park so some of the road infrastructure was already present.
I do wonder if any of the Merlin parks have gone begging for transport infrastructure and it been refused? All they seem to be bringing up is the VAT stuff anyway. From what is known its JCB that has been the issue with Alton Towers bypass road schemes.

 

[xtpower]

It is incredibly easy to say "I knew it all along" when you have the answer sheet in front of you.

I was merely poking fun. After all in one of his posts he called it a 'imaginary park' and launched into a very sarcastic version of it, referencing Nigel Farage and a dark ride diving into the 'depraved depths of our country'. I think if someone goes to those lengths (even humourously) to say something is not happening, he can take a little ribbing when it turns out it pretty much is.

Also, this isn't me doing the 'knew it all along' just having a little fun. Since I've started posting here I've been on the optimistic side of this whole thing, I haven't changed tune or anything, I've always thought it was likely to happen and have said so.

 

[GooseOnTheLoose]

You could of course look at it as a £190m subsidy for JCB then.... I know realistically the road improvements didn't just benefit JCB or Alton Towers or the new housing, its a mixture of everything. But just balancing that transport improvements are often not just about one thing (although in the Universal case a lot of the road infrastructure is only because of the theme park).


They were going to spend at least £62m on the train station anyway, I expect if that wasn't already planned for it would be a diffferent situation. The spending on the station is needed due to the new housing in the area anyway. So in a way it is similar to the above example where housing and JCB benefitted, except this time it is housing and Universal.
Also is anyone else looking at investing billions in a theme park? We've got nothing to compare it to as no new major theme park has been constructed in the UK. Legoland Windsor was probably the last major one and that was previously a safari park so some of the road infrastructure was already present.

You are conflating a regional transport strategy with a site specific enabling works package.

The A50 improvements were part of a long term strategic corridor upgrade to improve east-west connectivity across the Midlands, benefiting haulage, commuters, and yes, a major manufacturing exporter. It resolved an existing bottleneck on a trunk road.

The upgrades for Universal aren't resolving an existing bottleneck. They are creating capacity for a demand that does not yet exist and will only exist if the specific commercial venture goes ahead.

You are quite right that a station was at Wixams planned. It was budgeted at circa £60 million (around 12% of the Universal subsidy) to serve the local housing development. It was designed as a commuter stop.

It was not designed as a high capacity resort gateway capable of processing 12 million tourists a year, with the necessary crowd control infrastructure, baggage handling space, and shuttle interchanges. The "delta" between the cost of a functional local station and the cost of a Universal ready transport hub is the subsidy. That difference is being picked up by the taxpayer to facilitate Comcast's business model.

Usually, when a developer's project requires infrastructure upgrades beyond the local need (e.g. "Your theme park will crush this commuter station"), the developer pays for the upgrade via Section 106 or CIL. In this case the state is picking up the tab.

When the Battersea Power Station development required a Northern Line extension to make the project viable, the developers footed the billion pound bill through S106 contributions and a Tax Increment Financing deal. When Heathrow built Terminal 5, BAA paid for the rail tunnels. Even the Co-Op Live arena in Manchester, a massive leisure destination, was entirely privately funded including its infrastructure connections.

The fact that "no one else is looking at investing billions" shouldn't be a justification for tearing up the rulebook on fair competition; if anything, it is the exact reason why the rulebook exists. We shouldn't be so desperate for foreign capital that we pay them to take our money.

 

[Dave]

Although there has in the past been road infrastructure improvements that have directly or indirectly helped Alton Towers and other parks.
£190million was spent on roundabouts and new roads near Uttoxeter that significantly benefitted JCB and Alton Towers https://www.highwaysindustry.com/staffordshire-wins-pinch-pot-road-improvements/

I’m not convinced that project really helped Towers, it’s bottleneck was never Uttoxeter.

 

[jon81uk]

I’m not convinced that project really helped Towers, it’s bottleneck was never Uttoxeter.

There was new roundabouts at Denstone, it converted two of the junctions towards Alton to roundabouts. Yes Alton village itself is still a bottleneck, but I think there was at least some benefit to driving to AT.

You are quite right that a station was at Wixams planned. It was budgeted at circa £60 million (around 12% of the Universal subsidy) to serve the local housing development. It was designed as a commuter stop.

It was not designed as a high capacity resort gateway capable of processing 12 million tourists a year, with the necessary crowd control infrastructure, baggage handling space, and shuttle interchanges. The "delta" between the cost of a functional local station and the cost of a Universal ready transport hub is the subsidy. That difference is being picked up by the taxpayer to facilitate Comcast's business model.

Usually, when a developer's project requires infrastructure upgrades beyond the local need (e.g. "Your theme park will crush this commuter station"), the developer pays for the upgrade via Section 106 or CIL. In this case the state is picking up the tab.

When the Battersea Power Station development required a Northern Line extension to make the project viable, the developers footed the billion pound bill through S106 contributions and a Tax Increment Financing deal. When Heathrow built Terminal 5, BAA paid for the rail tunnels. Even the Co-Op Live arena in Manchester, a massive leisure destination, was entirely privately funded including its infrastructure connections.

I don't disagree completely, I think probably some infrastructure costs, particularly the new roads should have been an S106 type thing. Whereas I think more rail projects should be paid for by the government, the Heathrow tunnels really should be National Rail infrastructure so the fares can come down (Heathrow charge a fee to use the tracks so the Elizabeth Line is more expensive than the Piccadilly line) as indirectly it is users actually paying for that infrastructure anyway. Also generally public transport should be encouraged, I don't have a problem with a station being enlarged to meet its user base (a lot of this was done for the Olympics of course and therefore still benefits West Ham).
Incidentally, I do wonder why the developers of the housing at Wixams aren't paying for the station (the initial station before the theme park plan was announced) via an S106 (or maybe they are to an extent, as I've not looked that closely).

TL: DR, makes sense to me for government to fund rail projects, but new roads that are only required for one thing should be privately funded in my opinion.

 

[Dave]

There was new roundabouts at Denstone, it converted two of the junctions towards Alton to roundabouts. Yes Alton village itself is still a bottleneck, but I think there was at least some benefit to driving to AT.



I don't disagree completely, I think probably some infrastructure costs, particularly the new roads should have been an S106 type thing. Whereas I think more rail projects should be paid for by the government, the Heathrow tunnels really should be National Rail infrastructure so the fares can come down (Heathrow charge a fee to use the tracks so the Elizabeth Line is more expensive than the Piccadilly line) as indirectly it is users actually paying for that infrastructure anyway. Also generally public transport should be encouraged, I don't have a problem with a station being enlarged to meet its user base (a lot of this was done for the Olympics of course and therefore still benefits West Ham).
Incidentally, I do wonder why the developers of the housing at Wixams aren't paying for the station via an S106 (or maybe they are to an extent, as I've not looked that closely).

TL: DR, makes sense to me for government to fund rail projects, but new roads that are only required for one thing should be privately funded in my opinion.

It was more a benefit to Denstone, it in no way made journeys significantly quicker therefore increasing guest access, it stopped a village getting blocked.

Good for the area, economically negligible for AT.

The infrastructure investment for universal very much benefits the economic of the resort, which is fine, but unclear if it’s fair.

 

[GooseOnTheLoose]

Incidentally, I do wonder why the developers of the housing at Wixams aren't paying for the station via an S106 (or maybe they are to an extent, as I've not looked that closely).

They are, or rather, they did.

The original funding package for the Wixams station included a significant Section 106 contribution from the housing developers, Gallagher Estates. However, that contribution was calculated based on the impact of the housing development e.g., a functional, two platform commuter halt.

The reason the government is stepping in now is to upgrade the specification from suburban commuter stop to major resort gateway. The housing developers shouldn't be on the hook for that upgrade, as their residents don't need it. Universal needs it. Universal should pay for it, or at least pay the difference.

 

[jon81uk]

They are, or rather, they did.

The original funding package for the Wixams station included a significant Section 106 contribution from the housing developers, Gallagher Estates. However, that contribution was calculated based on the impact of the housing development e.g., a functional, two platform commuter halt.

The reason the government is stepping in now is to upgrade the specification from suburban commuter stop to major resort gateway. The housing developers shouldn't be on the hook for that upgrade, as their residents don't need it. Universal needs it. Universal should pay for it, or at least pay the difference.

I never suggested the housing developers should pay for the upgrade and I don't think anyone else has either? Not sure why you are mentioning that.

I think the government should be further investing in the railways and it shouldn't solely be solely up to developers either, it looks like from the news articles the government was originally putting £62m towards the station anyway but will now step up further to make the station suitable for the new development. The more that can be done to reduce car dependency the better

 

[xtpower]

I never suggested the housing developers should pay for the upgrade and I don't think anyone else has either? Not sure why you are mentioning that.

I think the government should be further investing in the railways and it shouldn't solely be solely up to developers either, it looks like from the news articles the government was originally putting £62m towards the station anyway but will now step up further to make the station suitable for the new development. The more that can be done to reduce car dependency the better

There's also a provision in the SDO legislation about reducing car dependency. I forget by which year but they want Universal to get the % of visitors using a car down to at least 31.7% (may have got the % wrong, I only perused that bit).

 

[GooseOnTheLoose]

I never suggested the housing developers should pay for the upgrade and I don't think anyone else has either? Not sure why you are mentioning that.

You literally asked:

Incidentally, I do wonder why the developers of the housing at Wixams aren't paying for the station via an S106

I was answering your specific question regarding why the existing S106 contributions from the housing developers weren't covering the cost of the Universal spec station.

I think the government should be further investing in the railways and it shouldn't solely be solely up to developers either, it looks like from the news articles the government was originally putting £62m towards the station anyway but will now step up further to make the station suitable for the new development. The more that can be done to reduce car dependency the better

We are in complete agreement that the government should invest in railways to reduce car dependency. However, there is a distinct difference between investing in public transport for the public good and investing in public transport to facilitate the operations of a specific private leisure asset.

The government "stepping up further" to make the station suitable for the new development is precisely the subsidy we are debating.

If I build a factory, and the local road needs widening to accommodate my delivery lorries, the Highways Authority expects me to pay for the widening via a Section 278 agreement. I cannot simply argue that "better roads are good for everyone" and ask the council to pick up the tab. The upgrade is required because of my commercial activity. The cost falls to me.

Universal is creating the demand. Universal requires the capacity. Universal will reap the profit from the visitors arriving on those trains. It is not unreasonable to expect Universal to fund the upgrade that makes their business model viable.

It is worth clarifying that funding is not the same as ownership.

When a supermarket pays for a new roundabout to access their store, they foot the bill because they created the demand. However, once built, the Council adopts it. The supermarket doesn't own it, nor can they close it to non-customers.

The same logic applies here. If Universal funded the upgrade to Wixams, it would remain a Network Rail asset serving the general public. Asking them to pay isn't about selling off the railway;. It is about ensuring the entity creating the burden pays to mitigate it, rather than the taxpayer subsidising their commercial operations.

There's also a provision in the SDO legislation about reducing car dependency. I forget by which year but they want Universal to get the % of visitors using a car down to at least 31.7% (may have got the % wrong, I only perused that bit).

By 2051, no more than 31.9% of visitors should be arriving by private car.

 

[xtpower]

Damn, I was off by 0.2% .

Goose, Jon was referring to the original two platform Wixams plan when asking about the s106 contribution from the developer. Not the beefed up 4 platform Wixams we'll be getting instead.

 

[SeeSharpy]

You literally asked:

I was answering your specific question regarding why the existing S106 contributions from the housing developers weren't covering the cost of the Universal spec station.

We are in complete agreement that the government should invest in railways to reduce car dependency. However, there is a distinct difference between investing in public transport for the public good and investing in public transport to facilitate the operations of a specific private leisure asset.

The government "stepping up further" to make the station suitable for the new development is precisely the subsidy we are debating.

If I build a factory, and the local road needs widening to accommodate my delivery lorries, the Highways Authority expects me to pay for the widening via a Section 278 agreement. I cannot simply argue that "better roads are good for everyone" and ask the council to pick up the tab. The upgrade is required because of my commercial activity. The cost falls to me.

Universal is creating the demand. Universal requires the capacity. Universal will reap the profit from the visitors arriving on those trains. It is not unreasonable to expect Universal to fund the upgrade that makes their business model viable.

It is worth clarifying that funding is not the same as ownership.

When a supermarket pays for a new roundabout to access their store, they foot the bill because they created the demand. However, once built, the Council adopts it. The supermarket doesn't own it, nor can they close it to non-customers.

The same logic applies here. If Universal funded the upgrade to Wixams, it would remain a Network Rail asset serving the general public. Asking them to pay isn't about selling off the railway;. It is about ensuring the entity creating the burden pays to mitigate it, rather than the taxpayer subsidising their commercial operations.

By 2051, no more than 31.9% of visitors should be arriving by private car.

If you ignore the amount of money that the government will get from the fact universal studios being there with additional tourism, VAT, Train Tickets (All train operators should be in public ownership by 2031) then yeah sounds like a one sided street.

It's called investment, not throw money at universal, and not get anything back, the amount the government is spending on Wixams, and A421, will be recouped from the additional revenue from Universal.

 

[jon81uk]

I was answering your specific question regarding why the existing S106 contributions from the housing developers weren't covering the cost of the Universal spec station.

I have added better context to my previous point, but I did not ask the question "why the existing S106 contributions from the housing developers weren't covering the cost of the Universal spec station." I asked why they weren't paying for the "station", so I've added the context to make it clear, the original spec of station prior to the theme park plan, but in your text above you stated you answered a different question to what I was asking.

It is worth clarifying that funding is not the same as ownership.

Although in the case of the Heathrow rail tunnels that you gave as an example earlier that rail infrastructure is owned by Heathrow Airport Limited, ownership didn't pass to British/National Rail or TfL. Whereas the tunnel to Stansted Airport was built by British Rail, but its the airport and airlines that profit from it, should they not have paid for that one?

Public funding of infrastructure is messy and I stand by that probably Universal should fund roads that are only needed for their development, but I think the government should be investing in rail services and new stations. Realistically they should have gone back and said "you pay for the roads, we'll build you a station".

 

[GooseOnTheLoose]

If you ignore the amount of money that the government will get from the fact universal studios being there with additional tourism, VAT, Train Tickets (All train operators should be in public ownership by 2031) then yeah sounds like a one sided street.

It's called investment, not throw money at universal, and not get anything back, the amount the government is spending on Wixams, and A421, will be recouped from the additional revenue from Universal.

I'm acutely aware of what it's called, and I've addressed this a few times before over the past year, but I can see that you are a relatively new poster (welcome!), so I shall quickly go over it once more.

I am not "ignoring" the money the government will get. I am simply arguing that the government should get all of that tax revenue without having to deduct half a billion pounds in construction costs first. That is how we maximise the benefit to the public purse.

Paying tax (VAT, Business Rates, Employer NI) is the legal obligation of doing business in the UK. It is the price of entry. It is not a down payment that entitles a corporation to have their specific commercial infrastructure needs met by the public purse.

When Tesco builds a supermarket, they generate millions in tax revenue. We still expect them to pay for the access roads and traffic signals required to service that store. We don't say, "Don't worry, the council will tarmac the car park because you'll sell a lot of beans next year."

I am simply calling for equality. Every other business in the UK is expected to fund their own enabling infrastructure and pay their taxes. Why should a multi-billion dollar American media conglomerate be the exception?

We must also consider the impact on domestic competition. Subsidising Universal's entry into the market means that the government is effectively using tax revenue generated by existing UK operators (like Merlin, Blackpool Pleasure Beach, and Paultons (Praise Be)) to fund their newest and largest rival. It creates a state sponsored market distortion where established British businesses are forced to compete on an uneven playing field against a US giant that has had its startup costs artificially lowered by the Treasury.

Universal is going to build their theme park outside Bedford regardless. As it has been pointed out on numerous occasions, it is a multi-billion pound project. An additional £500 million to build their own infrastructure is a rounding error on Comcast's balance sheet, not a dealbreaker. They aren't going to walk away from a lucrative new market just because we asked them to pay for their own train set.

If the government pays, the return to the taxpayer is tax revenue minus infrastructure cost. If Universal pays, the return is tax revenue.

However, I have made these points on several occasions now, and I'm getting rather dizzy swimming around the same pond in ever decreasing circles. I shall draw a line in the sand here.