CITY of York Council is set to borrow more than £1 million towards the cost of refurbishing the Barbican Centre, The Press can reveal today.

Under a deal provisionally agreed with prospective centre operators SMG Europe, the authority would be reimbursed by SMG through rental payments over the next 30 years.

Last month, the council said SMG would spend more than £2 million in building, fitting-out and setting-up costs at the Barbican over the first five years.

But it has now emerged while SMG will meet £1 million of the costs upfront, the remaining sum – between £1 million and £1.113 million – will be met by the council after borrowing the sum at a preferential interest rate.

Leisure boss Charlie Croft said the proposal to borrow the money, which will be put to a meeting of full council on Thursday, could not be revealed until today.

He said the borrowing plan had had to remain confidential during a 14-day legal ‘standstill’ required under European procurement law, which started when the executive agreed on September 21 to SMG becoming the preferred bidder to reopen and operate the Barbican.

He said the council would not give SMG the money as a loan; it would instead be spent directly on refurbishment work. However, he dismissed suggestions that such a loan would have been illegal, had the authority wanted to give it to SMG.

He accepted there was an element of risk through the reimbursement of the council through rent.

As The Press revealed last month, SMG, one of the world’s leading entertainment venue operators whose centres in Britain include the Manchester Evening News Arena, want to stage hundreds of entertainment and conference events at the Barbican, which has been mostly empty and unused for almost six years.

Events will range from stand-up rock concerts to classical music performances and theatre events, and up to 40 full-time jobs will be created.