DETAILS of the mismanagement of a North-East town centre redevelopment – which left taxpayers facing a £780,000 bill for a gas pipe blunder – are revealed today.

The Pedestrian Heart scheme, in Darlington, ran into costly delays in January 2006, when contractors hit a 100- year-old cast iron gas main, buried in a shallower trench than plans had indicated.

The entire pipeline was rerouted, adding £780,000 to the cost, disrupting the town centre and delaying the scheme by four months.

Councillors commissioned Ward Hadaway solicitors to review the project and advise the authority on whether or not legal action could be taken against either contractor to recoup any of the money.

The confidential report, which cost £40,000, has been obtained by The Northern Echo and it shows that:

● Darlington Borough Council’s files recording its involvement in critical decisions appear to be incomplete;

● Investigators had to piece together the facts from third party accounts based on memories of what happened when the scheme hit problems;

● The signed contract for appointing the main project management company, Gillespies, was never finalised;

● The authority signed a deal with builders Birse which left it liable to pay 90 per cent of any overspending on the Pedestrian Heart project;

● The deal was described as “an extremely low risk contract” for Birse with “very limited incentive for efficient working”;

● Work began on “peripheral areas” rather than the main scheme, reducing the council’s scope to save money by dropping non-essential jobs if the project budget started to overrun;

● Councillors decided to replace the entire pipeline, rather than amend the scheme’s design as suggested by the project managers;

● As to the prospects of winning compensation through the courts, the report says: “Litigation would be extremely expensive and disproportionate to the probable prospects of success…”

Council officials insist lessons have been learnt and new procedures put in place.

The report, compiled by solicitors Ward Hadaway and forensic engineers EC Harris on a recommendation of the council’s resources scrutiny committee, recommended the council implements the training of technical staff in contract workings.

The spokeswoman said: “The council has been open in the acknowledgement that the Pedestrian Heart was not well managed. A new approach has been introduced which ensures that every major project over £75,000 is monitored on a regular basis.”

The report has been distributed to council cabinet members, along with a public report which will be discussed at Tuesday’s meeting.

Darlington Liberal Democrat leader Martin Swainston said it showed “total incompetence and mismanagement”.

He said: “There seems to have been absolutely no control over officers and no management decisions made at the top end. Someone should have resigned or lost their job.”

Darlington Conservative leader Heather Scott said the most important aspect was lessons had been learnt.

She said the resources scrutiny committee review, which the Tory group had played a significant role in, had put in place measures to ensure the same thing would not happen again. She added: “The whole thing should not have happened as it did.”

A spokeswoman for Gillespies said: “Gillespies would like to make it clear that we are not in dispute with Darlington Borough Council.”