Culture Coventry turns to council for emergency loan
Local authority continues its bid for UK City of Culture 2021
Culture Coventry, the trust that runs Coventry Transport Museum, the Herbert Art Gallery and Museum and the Lunt Roman Fort, has been given a short-term loan for an undisclosed amount by the city council amid mounting financial pressures.
The trust warned last November that it would have a “small revenue shortfall” in 2016/17 and 2017/18 onwards. A £8.5m extension at the transport museum and other projects have forced the trust to spend its cash reserves, and it anticipates higher storage costs in 2017/18 after relocating to new premises.
Although Culture Coventry is not insolvent, the council said the trust would not be able to sustain costs such as salaries in 2017/18 without financial assistance.
A £250,000 cut to Culture Coventry’s council grant came into effect this April.
At a cabinet meeting earlier this week, councillors approved a request for a short-term loan. They also agreed to defer a loan repayment connected to the transport museum’s extension for 12 months and to help with redundancy costs of a management restructure that will see the “deletion of senior posts”.
The loan will enable Culture Coventry to develop a new business plan and create projects over the next year to generate income. It will also be used to pay the next three years pension fund contribution in advance.
A spokesman for the council said it would not be revealing the terms of the loan or the amount. However, a council report (pdf) shared at the cabinet meeting states that it will be repaid at a commercial rate. Culture Coventry is already implementing a “series of cost-saving initiatives” to address its financial problems.
The report also reveals that the 2016/17 deficit is primarily a result of lower than anticipated visitor numbers through the development period.
Martin Yardley, the deputy chief executive of Coventry City Council, said that museums in Coventry were a vital part of its bid to be UK City of Culture 2021.
“As a result of recent work to prepare the sites for the future, the trust has found it is in need of a little financial help and we are looking at what we can do as a council to give it the breathing space it needs so it can continue to run top class venues for the people of Coventry and our visitors in the years ahead,” he said.
Link
Council report: Culture Coventry Trust - Financial Performance and Support Arrangements (pdf)
The trust warned last November that it would have a “small revenue shortfall” in 2016/17 and 2017/18 onwards. A £8.5m extension at the transport museum and other projects have forced the trust to spend its cash reserves, and it anticipates higher storage costs in 2017/18 after relocating to new premises.
Although Culture Coventry is not insolvent, the council said the trust would not be able to sustain costs such as salaries in 2017/18 without financial assistance.
A £250,000 cut to Culture Coventry’s council grant came into effect this April.
At a cabinet meeting earlier this week, councillors approved a request for a short-term loan. They also agreed to defer a loan repayment connected to the transport museum’s extension for 12 months and to help with redundancy costs of a management restructure that will see the “deletion of senior posts”.
The loan will enable Culture Coventry to develop a new business plan and create projects over the next year to generate income. It will also be used to pay the next three years pension fund contribution in advance.
A spokesman for the council said it would not be revealing the terms of the loan or the amount. However, a council report (pdf) shared at the cabinet meeting states that it will be repaid at a commercial rate. Culture Coventry is already implementing a “series of cost-saving initiatives” to address its financial problems.
The report also reveals that the 2016/17 deficit is primarily a result of lower than anticipated visitor numbers through the development period.
Martin Yardley, the deputy chief executive of Coventry City Council, said that museums in Coventry were a vital part of its bid to be UK City of Culture 2021.
“As a result of recent work to prepare the sites for the future, the trust has found it is in need of a little financial help and we are looking at what we can do as a council to give it the breathing space it needs so it can continue to run top class venues for the people of Coventry and our visitors in the years ahead,” he said.
Link
Council report: Culture Coventry Trust - Financial Performance and Support Arrangements (pdf)