Anglesey fish farm grant risks not heeded

The auditor general found that although procedures were followed, they were not suited to a project on such a scale, BBC News reported.

Penmon fish farm,  which promised 30 jobs, had been due to be completed in 2003 but encountered problems which resulted in delays and increased costs. It eventually opened in 2009 producing sea bass. It went into administration in 2011, two years after it opened at a cost of £11.9m.

The Welsh government said it had made significant improvements to processes.

The auditor's report  said the procedures followed at the time the Welsh government approved the grant were "unsuited to a project of this scale, complexity and risk".

The monitoring of progress of the project also did not focus enough on the risks identified during the project's appraisal.

As a result of strengthening the funding regime for European grants and improving the management of complex projects, it was more likely that significant risks would be identified during the appraisal and evaluation process, the report noted.

It recommended four additional changes to the process.

But noted the government had since overhauled its approach to grants.

Welsh ministers authorised a £40,000 grant to pay for oxygen to be pumped into the water for the estimated two million fish at the fishery while the deal was being done.

The site's former owner, Selonda UK, was fined £50,000 after it admitted allowing the discharge of "trade effluent and chemicals" into a protected coastline.

The new owners have invested in new technology and are producing around 1,000 tonnes of sea bass, BBC News said.