Scottish centre for arts in the red after relaunch

April 03, 2002 |

One of Scotland's leading arts venues has effectively gone into the red less than six months after a gala relaunch and a (pounds) 10m refit.

The Centre for Contemporary Arts (CCA) in Glasgow has run up a 'sizeable deficit', estimated at (pounds) 53,000, which will 'severely deplete' its cash reserves, according to a report going before Glasgow city councillors tomorrow.

The financial situation is attributed to poorer than expected returns from a cafe-bar and a lack of sponsorship in the year to March 31, 2002.

The report also recommends giving the CCA around (pounds) 68,000 less than it requested in grant for 2002/03, potentially aggravating any cash problems.

Last night, the CCA said the council had 'misinterpreted' its finances, and insisted it had no money worries for the new financial year.

Graham McKenzie, CCA director, said: 'I think 'deficit' is the wrong terminology. What they mean is that we are eating into our reserves, and that means we have to budget accordingly for the coming year. It would be wrong to say there was a crisis.'

He said the first six months had merely seen the CCA adjusting to the increased running costs of the venue, which is 40% bigger than its predecessor, and he was confident it had a sound financial future.

Based in an A-listed Alexander 'Greek' Thomson building on Sauchiehall Street, the CCA reopened last October after a two-and-a-half year refit masterminded by David Page, the Glasgow architect.

More than (pounds) 10m capital funding from the National Lottery, Scottish Enterprise, Historic Scotland and the European Union paid for the purchase of four adjoining buildings and the creation of new performance spaces, a bar, restaurant, 74-seat cinema, bookshop and 200-seat theatre under one roof.

However, the expansion which drew 50,000 visitors in the first three months, has also meant higher bills for staff and utilities.

The problem with running costs echoes the difficulties experienced by other large capital projects in Glasgow, notably the (pounds) 13m Lighthouse Building.

A key legacy of the 1999 year of architecture and design, the Lighthouse was 'technically insolvent' within 18 months and was bailed out by a (pounds) 320,00 rescue package from Glasgow City Council.

A report before a special grants committee of the council's culture and leisure services tomorrow says the CCA hopes to spend (pounds) 784,000 in 2002/03.

Around (pounds) 410,000 of its income is expected to come from the Scottish Arts Council, and (pounds) 145,000 from trading.

The CCA has also requested (pounds) 178,000 in grant funding from Glasgow City Council. However the report recommends an award of only (pounds) 110,400, which would leave the centre with a (pounds) 67,600 shortfall on its projected budget.

The report says: 'A deficit of (pounds) 53,000 is estimated in the year to 31st March 2002. This deficit will severely deplete reserves.'

However, Martin Gill of PKF, the CCA's accountants, said: 'There is no crisis. Expenditure is higher than income in the financial year 2001/02 but that must be taken in context. It's definitely not bust.'

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