For:

(x)

Agenda Item Number: 14

Executive X CLMT Meeting Date: 3rd October 2011 Report of: Head of Community Living Report author: Michelle Griffin Subject: Luton Culture Savings Proposals (excluding Libraries)
(For Executive Only)

Lead Executive Member(s): Cllr Ashraf Wards Affected: ALL

Consultations: Councillors Scrutiny Stakeholders Others

(x)

Recommendations 1. The Executive is asked to authorise consultion on the proposals with a view to bringing a final report back to the Executive at a later date: (i) Closure of Wardown Park Museum on weekdays during term time for general public visits excluding pre booked tours from April 2012 (ii) Move Fireworks to Stopsley Common as a pilot for 2012 and charge for parking at the new sports centre site to reduce the subsidy of the event (iii) Cease Summer Festival in St Georges Square from 2013 (iv) Close John Dony Field Centre, Turners Knoll and Barton Road Museum Stores. Background 2. Luton Culture was set up to protect and enhance cultural services at a time before the current financial situation, but it was still evident that the mainly non-statutory services would remain in a vulnerable position within the budget challenges of the Council. The charitable trust status afforded to Luton Culture allows them to take advantage of opportunities such as gift aid. The agreement (FMA) between the Council and Luton Culture is a 25 year agreement with a five year funding agreement. This basically gives the Trust an uplift by the RPI (though it was a reduction in 2009-10 as the RPI from the previous year that the agreement was based on was negative), minus a 1.5% efficiency saving. Luton Culture has restructured, developed new cross-Trust teams, worked at diversifying its income and made savings in the order of 900,000 since it was founded in 2008. It has reduced its reliance on LBC from 73% of its funding to 68% of its funding in three years. However, rather than this work providing stability and resilience now, its additional funding and savings have been required to cover the Trusts VAT position (the Trust now has non-reclaimable VAT of c250,000 per annum which wasnt accounted for in the transfer) and other ongoing costs such as increases in National Insurance etc. The Council also did not pay the Trust the RPI uplift that is in the FMA for this year (worth a further 160,000). This has left the Trust in a position with little reserve and, an ongoing VAT challenge. The Council did, however, give the Trust a one-off amount of 250,000 in 2010 to use for investment in cultural activity that would generate income in the recognition that they are in a very difficult financial position due to the way the funding agreement was structured. This funding has been used to employ a fundraiser and to invest in capital equipment that saves the Trust ongoing revenue cost and that the trust gain income from hire charges. The current position 3. The Trust is currently going through a further restructure to manage the loss of almost 1m funding from April 2012 when the Renaissance in the Regions museums hub structure is dismantled (780,000 per annum for the museums) and its Arts Council funding stops (115,000 per annum). Luton Culture needs to set a budget for 2012-13 that is 1m less than this years budget before the Council makes any decisions about its own funding. The Council and Luton Culture are due to begin discussions regarding their next FMA later this year. Within the FMA there is a principle that the 10/1

Council can ask the Trust to stop a particular part of its activity; the Trust then has six months to implement that at which time the Council reduces the Trusts funding by the relevant cost related to that activity. The Council is exploring opportunities for further activity that the Trust can deliver that is relevant and appropriate to the Trust (for example, the Visitor Information Centre was transferred to it on 1st April this year) Goals and Objectives 4. To propose initial options to the Council to reduce service provision in order to reduce costs. Proposal 5. A wide range of services are under review requiring detailed analysis but the proposals that have been identified are: (i) Closure of Wardown Park Museum from April 2012 on weekdays during term time for general public visits excluding pre booked tours. This would generate a reduction in funding to Luton Culture of up to 53,000 per annum. The site would be open to the general public during school holidays and the weekends and also to pre booked group bookings during the week. This option would allow the Trust to build a more sustainable business model for the Museum which would include seeking Heritage Lottery Fund investment to improve the building for both the general public and as a space for community and commercial activities such as weddings, meetings and other commercial uses. (ii) Move Fireworks to Stopsley Common as a pilot for 2012 and charge for parking at the new sports centre site to reduce the subsidy of the event. There are approximately 400 parking spaces at the site and if a charge of 5 was made for each car, additional revenue of 2,000 could be generated. To be certain that this pilot could be undertaken there would need to be consultation with the airport, a site visit would be required to gauge what infrastructure would be required for health and safety purposes and a traffic plan put in place to overcome the congestion from the cars parking at the site and also how people without transport will get to the site. (iii) Cease free Summer Festival in St Georges Square from 2013 . The current Summer Festival costs 25,000 (iv) Close John Dony Field Centre, Turners Knoll and Barton Road Museum Stores. All activities that take place at the John Dony Field Centre can be and are mainly provided at Stockwood Discovery Centre. There is a 1000 revenue saving from closing this facility and this room would be handed back to the Bushmead Community Centre to help them generate more income from lettings. Turner Knoll and Barton Road Stores are used by the Museum Service. If the sites were handed back to the Council then the Council may be able to generate a capital receipt from the sites. Key Risks 6. A risk assessment would need to be completed related to the potential relocation of the fireworks display to Stopsley. Consultations 7. Consultation would be required regarding the Wardown proposal with users of the museum and the Friends of Luton Museums. There will be a requirement to consult regarding potentially relocating fireworks. Appendices and additional background papers attached: None IMPLICATIONS Clearance agreed by: David Watson, Solicitor, on 16/09/11 Ceri Davies, Finance Manager HCL on 19th

Legal Finance

There are no direct legal implications to this report. There are no financial implications to this report 10/2

Equalities

None

Environment

There are no direct environmental implications to this report

September 2011 Equality and Diversity Policy Manager19th September 2011 Strategy and Sustainability Officer, 16th September 2011

Community Safety Staffing

2.3 fte posts would be deleted from Luton Culture The Trust would seek to redeploy staff elsewhere in the organisation if possible but otherwise the redundancy cost would be borne by the Council.

Other FOR EXECUTIVE ONLY - Options: (a) To agree the proposals (b) To modify some or all of the proposals (c) To reject the proposals.

10/3