Wembley project nears collapse

The long-running Wembley saga moved closer to complete fiasco last night when the Football Association announced that it was pulling out of financing the new national stadium, claiming that the plan could bankrupt the organisation.

The FA pleaded with the government to intervene in the construction of a new Wembley stadium and a working group, led by the home secretary, Jack Straw, will now examine a number of options. Its decision will not be announced until after the expected June election.

The options include building on a greenfield site away from London, or even abandoning the idea of a stadium for England. In that case the national team would play at club grounds around the country.

But the government last night ruled out financial support for a new national football stadium, either from taxpayers or lottery funds, claiming that it "cannot step in as a banker of last resort" for the troubled project.

The plan to open the stadium at the end of 2004 has been scrapped.

Tony Blair, while acknowledging the national interest is at stake, wants to stay at arms length after the Dome fiasco. However, the government is almost bound to be drawn in, as it has been to refinance Railtrack and other privatised disasters.

A government spokesman said: "We have made it clear that we remain committed to the proposals for a new national stadium and we will work with the various authorities to look at different options but that doesn't mean the government can simply write blank cheques or act as a national bank for projects which encounter difficulties."

The FA chief executive, Adam Crozier, said last night that a number of City institutions had asked his organisation to underwrite the entire ?400m loan required for a new national stadium as well as contribute ?125m towards it. In addition, the FA was being asked to repay ?55m per annum in interest on the loan.

The FA had appointed the American bank Chase Manhattan, now known as JP Morgan, to raise the finance.

Mr Crozier said that the FA was not in a position to make such a financial commitment and that the government needed to provide such assurances, as has happened with the construction of stadiums in France and Australia.

Mr Crozier said: "We have to be clear and professional about what our role is. We are here to develop the game and we have to be realistic about how much money we can put into the project. It is not right for us to act as the sole sponsor of the scheme."

Mr Crozier also gave the strongest hint to date that the FA was prepared to not have a national stadium at all, with England matches being played at club grounds.

He added: "There's a huge appetite for England being on the road. We know that it can work. There are other countries who don't have national stadiums and it works quite well for them. Maybe it could work quite well for us as well."

When asked why public money should be given to football, the country's richest sport, Mr Crozier replied: "Everyone agrees that we would like a national stadium."

City insiders appeared shocked last night that the FA had apparently put the government over a barrel.

A spokesman for JP Morgan said: "We continue to believe that Wembley stadium is a viable project that should be able to ultimately attract the necessary levels of financing."

Related article
02.05.2001, Richard Williams: At last, a chance to build a proper national stadium