A tale of two venues

The closure of both the Derby Playhouse and Aberdeen’s Lemon Tree has rocked the arts world this week. Both venues were undergoing financial reviews and had approached local government and arts councils for help. Both are now the subject of rescue campaigns.
Derby Playhouse, which closed on 6 December with 80 redundancies, required £70,000 to avoid insolvency. Joint Artistic Director Stephen Edwards blamed the three-year refurbishment of the Westfield Shopping Centre, where the venue stands, for £330,000 in lost income. “No provision was set aside in the 106 planning consent to underwrite the theatre,” he said, “and we were told that if we did not trade on we would lose the Derby City Council (DCC) grant.” Arts Council England agreed to bring forward £70,000 of the theatre’s next grant payment and offered a further £30,000 if the local authority invested in the rescue plan. DCC has not committed to an early payout, saying that the Playhouse had failed to provide all the requisite information, including an action plan for amateur groups, worth £45,000 of funding.
The Playhouse has now reopened after administrators agreed that the Christmas show could resume. A consortium led by former Playhouse Chairs Professor Jonathan Powers and Michael Hall, Stephen Edwards and former Chief Executive Karen Hebden, has proposed a business model signalling “a ground-breaking new approach to theatre financing in the UK, comprising a combination of public and private funding without structural reliance on discretionary grants. …such a model can help shape future policy for arts funding.” [[The Playhouse has now reopened after administrators agreed that the Christmas show could resume]]
The Lemon Tree performing arts venue in Aberdeen has also been undergoing financial problems for some time and has closed with the loss of 56 jobs. It was in a transitional period, moving from receiving core funding from the Scottish Arts Council (SAC) to a project-funded model.
SAC has been concerned about the Lemon Tree’s finances for some time. In a statement, it said that it had “received assurances from the Chair and Management of the Lemon Tree that they were able to manage their finances in this financial year on the known levels of funding, albeit that a ‘manageable’ deficit was predicted. It is disappointing that this has not been achieved.”
Aberdeen City Council states that its Resources Management Committee offered the Lemon Tree “the chance to take out a loan from the City Council-administered Aberdeen Business Enterprise Scheme, and that the venue could have its overdraft facility underwritten up to a reasonable new limit by the City Council”. However, Lemon Tree Chair, Mr Hall Harper, has told ArtsProfessional that the overdraft facility was offered only to cover an interim period during which a loan would be set up. The offer was, he says, “a bank loan at a commercial rate of interest which would have to be guaranteed personally by the directors of the Lemon Tree… The minimum was in excess of £27,000, to which all nine directors had to agree.” Finding this unacceptable, the Board decided to close the venue.
Complications include the fact that a number of members are also elected councillors, some of whom sit on the Resources Management Committee. The future of the building, which belongs to Aberdeen City Council, is extremely uncertain.