The National Audit Office Wales (NAO) has published a swingeing attack on the Arts Council of Wales (ACW) for its handling of the Lottery grant awarded to Cardiff ?s ill-fated Centre for Visual Arts (CVA), whose financial shortfalls forced its closure in November 2000, just 14 months after its opening. The NAO report was presented to the Welsh Assembly by Auditor General, Sir John Bourn, who said ?The project was badly planned and assessment and management of risk was inadequate. The Arts Council of Wales then failed to monitor progress so it was unable to head off problems before they became crises.? The report concluded that the Centre?s market potential was never realistically investigated, that its financial plans were based on unsound forecasts and that ACW awarded Lottery money to the Centre without adequate consideration of the application.
Major changes to the specification of the Centre were effected without ACW?s knowledge, meaning that the new building was unable to provide adequate secure storage space to show exhibitions of national and international status. As a direct result, the artistic programme shifted away from ?blockbuster? exhibitions towards the work of contemporary artists, but ACW had failed to question the likely impact of this on box office appeal or conduct a sensitivity analysis to consider the financial implications of CVA attracting fewer visitors than forecast. 250,000 visitors were predicted in the first year, but actual visitor numbers were only 47,000.
As the project progressed, ACW failed to place conditions on its grants despite clear warnings from external assessors that the lack of marketing strategy, the failure to attract private sponsorship and the absence of experience of running a visitor attraction among the Centre?s management team were problems that needed to be addressed. Cost estimates also proved unrealistic, with the final bill for the Centre rising from a projected £6.2m to over £8m, of which ACW contributed £3.2m in Lottery funding. Although ACW is in a position to invoke the clawback provision of the Lottery award and seek to recover its funding of the Centre for Visual Arts, it has agreed not to do so provided that the Centre?s assets are transferred to third party charitable organisations. There remain assets to the value of £20,000 which the Centre?s Trustees are unable to account for.
ACW, in response to severe criticism about its management from many quarters in recent years, has already appointed a new Chief Executive and announced a major internal restructuring. It is currently reviewing both its grant structure and its five year strategy. Public consultation on both is about to begin, with meetings taking place across Wales in November and December. For further details of the draft new funding schemes, contact ACW?s External Relations department t: 029 2037 6500, or w: http://www.ccc-acw.org.uk/contents/html
For details of the NAO report w: http://www.agw.wales.gov.uk