Castle Gateway is a regenerative project in the centre of York, including areas like 17-21 Piccadilly, occupied by SPARK; Castle Mills; St George’s Field car park; Castle car park and Eye of York; and the Coppergate Centre.

The project has been changed since Labour took over control of the council in May 2023 from the Liberal Democrat and Green Party.

Labour has scrapped a £15m multi-storey car park at St George’s Field car, which the City of York Council has acknowledged will cost up to £1m. The Castle Mills housing development has also been paused to ensure its pledge to build 100 per cent affordable housing on council-owned land is fulfilled.

Furthermore, the new administration wants to build affordable housing in 17-21 Picadilly, currently occupied by SPARK, an outlet of bars and eateries in upcycled shipping containers.

However the council extended SPARK’s lease by two years until 2026, saying it is not currently viable to build affordable housing until the council reduces its £11m projected overspend.

Coun Chris Steward, Conservative group leader at the council, will call for “a much more detailed look at the finances of the scheme, reconsideration of the extension of the SPARK lease which is on a very low rent on city centre land and parking provision to not be cut” at the Corporate Services, Climate Change and Scrutiny Management Committee on December 4.

Coun Steward has also asked that “serious consideration” be given to other uses for the site, “including a private sale.”

Coun Nigel Ayre, leader of the Liberal Democrat group, said: “By continuing with their 100 per cent affordable housing policy the administration has placed an indefinite halt on homes being built on the Castle Mills.”

He added that York “will see a 50 per cent decrease in localised parking provision” and “the financial reality of the decisions around parking means the council is forgoing £1.6million per year of income for a £1.1million per year saving.”

Executive member for major projects Coun Katie Lomas said: “The Castle Gateway project was badly in need of leadership and clear decision making, almost 18 months after progress stalled and commitment to it from the old Liberal Democrat administration was abandoned.

“One of its last meaningful decisions was to cancel design work on the Castle Mills housing plans. Due to current financial constraints, we’ll be moving some elements of the project forward before others while exploring the availability of external funding, such as through the York and North Yorkshire Mayoral Combined Authority.

“This is the best way to achieve each of the project’s aims while delivering value for the local taxpayer. We will minimise any write-off on this project. But building a giant multi-storey car park on the banks of the Ouse and across the road from a scheduled ancient monument when the council is trying to encourage a reduction in car journeys was always a bad idea.

“That write-off sits squarely with the old Lib Dem-Green administration who conceived the ill-judged plan in the first place and we will not throw good money after bad when the business case overall does not stack up.”

Bryn Roberts, director of governance at the City of York Council, said: “On November 16, the council’s Executive approved recommendations and agreed a number of actions to progress the Castle Gateway project. As is allowed in the council’s constitution this decision has been called in by members and will be discussed at a scrutiny meeting on Monday, December 4.

“Any recommendations from scrutiny will then be considered at a future Executive meeting.”

Castle Gateway, York: Calls for 'much more detailed look' at finances of York's Castle Gateway scheme