The Plymouth and South Devon Freeport has the potential to benefit residents in the South Hams – according to a new report by an Audit and Governance group at South Hams District Council (SHDC).

The report concludes that it “makes sense” to remain in the project as it is estimated that the Freeport will bring new investment to the area, said to amount to more than £300 million, in addition to creating 3,500 jobs across Plymouth and South Hams.

SHDC will also reputedly benefit from a “ringfenced business rates account”, meaning it will retain 100 per cent of the business rates in the Freeport area, rather than usual 14 per cent.

This will result in a potential fund of £24 million over 25 years for investment in South Hams.

Among the recommendations, the report advises the council to simplify land acquisition plans and work with the Freeport company to “enhance the focus on net zero and the green economy as a priority objective”.

This includes going ahead with the purchase of land in Sherford, although it advises the council to “put on hold” the purchase in Langage.

The review also makes recommendations to manage possible risks, such as the project’s anticipated costs for SHDC, which are estimated to exceed £5 million “in the early years of the project”.

Most of this amount will be used to purchase land (such as in Sherford), although the report adds that the Freeport “is projected to be self-financing” as the business rates “will pay for the borrowing costs”.

However, it says that net income in the first five years of operation “has changed from net positive projection of £2m to a net deficit of £288,000” in the last 18 months.

It blames the deficit on the delay in occupancy and the fact that business rate income from both Langage and Sherford has moved back approximately two years.

Despite this, it warns against withdrawing from the project as it will pose “very grave risks... in reputational, legal and cost terms”.

“On balance the benefits of the Freeport outweigh the costs and risks involved, so long as these are understood and continue to be well managed,” it adds.

The report acknowledges residents’ concerns, adding that there is a “greater need for a programme of communication and engagement within the community”.

SHDC’s executive member for economic development, Councillor John Birch, claimed the Freeport offered “clear outcomes for collaborative working” that would help the council’s net zero ambitions and the economy.

He said: “This is our largest economic project for the South Hams – improving local skills and jobs in our communities. We need to remember this is a 25-year project and it is still in its infancy and we must play our part in its development.

“We recognise that we need to explain clearly what we are doing and what this means for the South Hams. We understand that some residents may still have their doubts and we want to be open and transparent to show we are considering all the risks and opportunities of this project.”

Critics however argue that freeports pose a threat to local businesses, encourage criminal activity, including money laundering and tax evasion, erode workers’ rights and threaten democratic process.

In addition, there are fears that businesses in freeports will not invest in necessary infrastructure or create skilled jobs as promised.

South Hams resident Jim Funnell, who has closely been following the project’s progress, as well as being on the panel of a recent talk in Totnes on the Devon Freeport, gave a scathing assessment of the report, saying it had not taken into account all the possible risks and dismissing the assertion that the Freeport was “on track”.

He said: “There isn’t a council risk analysis or management plan. There are substantial risks that haven’t even been assessed.”

He also questioned the report’s financial projections given that it had advised against the purchase of land in Langage.

“All the projections are based on Langage and Sherford. (But) you can’t have a set of projections based on one idea in concept that has already changed. They need to revise those projections because it’s completely unrepresentative of the fact.”

For more information about the Freeport, SHDC has published answers to common questions at