Bad management blamed for losses
(From The Orcadian dated January 24, 2002)

Bad management has been blamed for financial losses incurred by the multi-million pound Pickaquoy Centre last year.

The £37,349 losses, during 2000/2001, were due almost entirely to the poor performance of the centre’s catering section.

The Kirkwall centre is not expected to make a profit and is therefore subsidised each year by the council, but councillors at Monday’s recreation and cultural services were told that at the end of the 2001 financial year, the centre was £289,349 in the red against an agreed deficit of £252,000.

The £37,349 shortfall has had to be carried forward into the current financial year when it will be paid off by the council.

The problems were caused by the catering section which suffered losses of £32,176 during the year.

Centre manager Mr Kieran Henderson told the committee that the catering section was now under new management and improvements had been made.

“We are expecting a surplus in this financial year,” he said.

Councillor Jim Foubister said he accepted that the Pickaquoy Centre was never going to make a profit, but he said losses within the catering section were never envisaged.

“That can only be construed as bad management,” he said.

Committee chairman Councillor John Brown replied: “Yes it is, but that is history.”

But Councillor Foubister countered: “It may be history but lessons have to be learned. If it can’t be operated by the public sector, quite frankly, it ought to be put out to the private sector.”

The committee also agreed that the centre should be given a £300,000 subsidy this year (2001/02) and the same amount in 2002/03. The predicted deficits for both years respectively are £292,700 and £290,940 and the extra subsidies will allow the centre to build up surpluses.

Speaking after the meeting, centre manager Mr Henderson said a finance and administration officer had also been appointed to improve operations at the centre.

“This has helped improvements in the catering operation and monitoring of our finances which has also resulted in improvements to IT and telecommunications.

“Financial performance is now operating within budget so we are very pleased with the progress that has been made.”

myles.hodnett@orcadian.co.uk