Costs spiral at Brussels HQ

The European commission headquarters in Brussels, a hulking asbestos-ridden structure which has been under extensive renovation for a decade, is well on its way to becoming one of the most expensive buildings in the world, it was claimed yesterday.

In a damning report, two Belgian senators estimated that the overall cost of renovation, removing the asbestos and providing the commission with replacement offices could reach £900m, against the original estimate of £100m.

"In the last few years we have seen a real explosion in costs, something in the order of 400 to 500%," said Vincent van Quickenborne, one of the report's authors.

His co-author, Alain Destexhe, told the Guardian: "This building will probably end up being one of the most expensive in the world."

The building, whose renovation has been accompanied by allegations of fraud and mismanagement, is called the Berlaymont but its critics say a better name for it would be the Berlaymonster.

The affair has put Neil Kinnock, one of the commission's two vice-presidents, in an awkward position, since he has the task of negotiating with the Belgian government, which is overseeing the project, how much the commission will pay.

The commission has the building on a long lease from the Belgian government.

In 1997 the commission signed a memorandum of understanding to the effect that it considered £240m a fair contribution towards the overall renovation costs and payment for puchasing the building.

Now that figure looks totally unrealistic, but if the commission agrees to pay more it will leave itself wide open to the allegation that it has squandered taxpayers' money.

His spokesman said yesterday that Mr Kinnock would not be willing to pay for the contractors' mistakes.

"We're committed to paying zero euros at the moment," said Eric Mamer.

"We want to buy it back if the price is correct, but we have made it clear that we would not pay extra costs linked to mismanagement or errors."