WORK on a flagship business development has gone over budget by more than £56,000 after encountering a series of problems.

Officers at Hambleton District Council are predicting that another £18,000 will be needed before the project, at Stokesley Industrial Park, is completed.

Incubator-style units are being developed using the latest in sustainable and energy efficient features.

The scheme attracted £2.4m in funding from regional development agency Yorkshire Forward, the European Regional Development Fund, BT and the district council.

But the project has hit a number of problems and despite designers making savings of more than £30,000, the council's director of planning and environmental services, Steve Quartermain, will ask the cabinet to approve extra funding of nearly £44,000 on July 20.

He said: "Costs of the development have increased due to unforeseen circumstances.

"Normally, in a building contract of this size, contingencies are included to cover these eventualities.

"In this case, the funding partners would not allow for contingencies, so any increases in cost have to be shown as expenditure over budget and offset by savings where possible.

"Although boreholes and trial pits were sunk to assess ground conditions, unexpected soft spots were encountered once work began, which accounted for an additional expenditure of £25,000."

The other overspends include Northern Electrical Distribution Limited (NEDL) having to divert cabling and move a junction box, the installation of security measures on doors, which cost £10,000, and extra water pipe work, which cost £1,300.

"All of the additional costs have been unavoidable and could not reasonably have been anticipated," said Mr Quartermain.

"The costs have been for essential works in the development of the project."

He said that once the project was up and running, it could generate money for the council.

"The scheme as it now stands means that the council not only has a substantial asset, but that asset has the potential to generate an ongoing income stream," he said.

Work should be completed by early October.