University College London has lost £6 million on plans for a cultural institute after financial worries forced it to abandon the project.
UCL's accounts for the year ended 31 July 2009 reveal a loss of £5.95 million on its Institute for Cultural Heritage project, which was to occupy a purpose-built "landmark" building at its Bloomsbury campus.
In a statement, UCL says that it had "reluctantly concluded that, in the present economic climate, it should not press ahead with its proposed new building for an Institute for Cultural Heritage in its original form".
Half the losses came from clearing the site, while "some of the remaining costs on project management and design fees have had to be written off", it says.
The University and College Union, which is opposing possible job cuts at UCL, said the university cannot afford such a loss when it is pushing for 6 per cent savings.
Sean Wallis, branch secretary, said: "When UCL is asking staff to count every penny, it is rather distressing to see it has spent £6 million on moving gravel."
The university secured a £1 million gift from the MBI Al Jaber Foundation for the proposed institute and would have won £5 million from the Heritage Lottery Fund had the scheme gone ahead.
But the university decided it could not provide sufficient funds to match the lottery grant.
Had it been built, the institute would have created a new home for four of UCL's most important collections, including the Petrie Museum of Egyptian Archaeology and library archives that feature George Orwell's manuscripts.
When the plans were announced in 2007, the university said the venture would widen public access to the collections, bringing a fourfold increase in visitor numbers.
A UCL spokesman said the university was "going through a master-planning exercise for viable alternative approaches, to see if we can create some of the facilities originally planned for the institute by remodelling existing buildings and spaces". He added that some supporters of the project were willing to transfer their investment to the revised proposals.
The spokesman described the site, which is in Gordon Street, as "UCL's last remaining development site on our Bloomsbury campus", adding that the work carried out was necessary "for any future building on the site".
He also said that much of the planning and design work "will be essential to inform future developments", meaning that it was not possible to determine the sum that will be written off entirely.
Elizabeth Clear, UCU branch president, said: "Because of the job cuts, we feel it's an enormous amount of money to have lost."
She added that the collections were "amazing" and deserved wider public access, but that UCL "did not consider the full implications" of its expensive plans.