I have today had a response from HLF which you may be interested in reading - along with my further response to points which were not answered - both are below for information! Dear Mr Jones, Penarth Pier Pavilion – Resilient Heritage Grant I apologise for the delay in providing a response. The Heritage Lottery Fund Office in Wales is currently experiencing some changes in staff and it is taking me longer than I would normally expect to catch up with correspondence. As you are already aware, Penarth Arts and Crafts Ltd In 2011, PACL secured a grant of £1.68 million from the Heritage Lottery Fund alongside significant contributions from other funders to carry out the major capital works to save and redevelop the Pavilion. The culmination of years of work by this organisation and its supporters finally culminated in the building re-opening to the public in December 2013. The quality of the restoration is unquestionable, and as you know, it was voted the National Pier Society’s Pier of the Year in 2014. Since the reopening of the restored Pavilion, the organisation has reported a modest but stable income from the café, events and the cinema. However, this has been insufficient to meet the operating costs of the building resulting in an annual deficit. Despite extensive efforts to close this operating gap and move into surplus, the continued deficit now threatens the organisation's financial viability and the trustees of Penarth Arts and Crafts Ltd has a responsibility to address this issue. The trustees therefore had to take the difficult decision to both reduce paid staff and temporarily close some facilities whilst they undertook a review of the piers business plan. The root of the piers problems is insufficient and inconsistent footfall, yet the cost of opening the pier seven days a week, 12 hours a day, 362 days of the year throughout the year are significant. The seasonality of use has become very apparent in terms of the cinema facility. The profit margins of a 60 seat cinema are very tight and providing such an extensive programme that sufficiently fills its capacity all year round is particularly challenging. Despite hard work by staff volunteers and trustees over the past three years of operation, it has become clear that continuing with the same business model is not an option. Penarth Arts and Crafts Ltd applied to the Resilient Heritage Programme for financial support to create a more sustainable business model and to further increase the use and appreciation of this important heritage building. After assessing the application and taking into account the urgency of the request for financial assistance, the Heritage Lottery Fund has provided a grant of £126,000 to Penarth Arts and Crafts Ltd. The grant is not a “bail out”, it is investment in the organisation to enable it to become sustainable and ensure Penarth Pier is protected and the building remains a public asset for the community. The grant will enable the Penarth Arts and Crafts Ltd to:- 1. Work with the Local Authority to consider increasing range and profitability of activities 2. Take external advice on increasing profits from trading 3. Develop a new detailed programming and marketing strategy 4. Secure additional resources to deliver strategy, including bringing in additional staff to free-up existing staff to spend more time fundraising. It is worth noting that Penarth Pier receives no revenue funding support as is the case with say, Chapter Arts, which has often been cited as a comparable facility. It has relied on one off grants such as the Coastal Community Fund support and our Resilient Heritage Grant. The future of this building, like many other similar buildings across Wales, will still need to raise part of its running costs year on year through on-going fundraising activity of all types. 5. Investment in systems to deliver greater efficiency and enable the organisation to improve marketing and fundraising. 6. Improve use of local volunteers by putting in place a support structure to enable offers of assistance to be matched to the business needs of the building. I hope you can see that Penarth Arts and Crafts has recognised some of the weaknesses of the organisation, and with our financial assistance, are taking practical steps to address those weaknesses. The ultimate aim is to ensure the building is open to the public as much as is practically possible within the current income constraints. Income has to match expenditure if the building is to have a long term sustainable future. After three years of operation, Penarth Arts and Crafts Ltd maintain they have a much clearer picture of how and when the public use the pier and its facilities, and like any other organisation driven by commercial concerns, will continue to adjust the building opening times in response. I acknowledge the concerns about the future of Penarth Pier that have been expressed through various media. It is clearly a well-loved facility, a local landmark building and people care about its future. However I also believe some of the criticism of Penarth Arts And Crafts Ltd has been both unfair and unhelpful. In my dealings with the staff and trustees of Penarth Arts And Crafts Ltd, what comes across very clearly is that they also really care about the building and are working incredibly hard to secure its long term future. I also think they understand the need to provide more information to the public and I believe that they will address this issue over the coming weeks as the summer season starts and footfall to the pier will hopefully increase. Yours sincerely Richard Bellamy Pennaeth, Cronfa Dreftadaeth y Loteri Cymru | Head of the Heritage Lottery Fund, Wales Ffôn | Phone: 02920 234144 Ebost | Email: richardb@hlf.org.uk Cronfa Dreftadaeth y Loteri | Heritage Lottery Fund 9 Plas yr Amgueddfa | 9 Museum Place Caerdydd | Cardiff CF10 3BD Gwefan | Website: www.hlf.org.uk Dilynwch ni ar | Follow us on on Twitter, Facebook, Instagram, Online Community Dear Richard Penarth Pier Pavilion – Resilient Heritage Grant Many thanks for your response to my letter to you of 21st April as per the HLF ‘Raising A Concern’ procedure. Whilst I consider that my original letter to you was clear in terms of the rightful concerns over further large sums of public money being given to PACL these concerns have not been addressed in your response. Like other concerned residents and users of the Pavilion in the past we are well aware of the huge sums of public money that have been given to PACL to date, the perilous financial state of PACL and the public stated criteria/reasons for awarding Resilient Heritage Funding. HOWEVER :- 1. It would be good to see the evidence for your statement that PACL has made ‘extensive efforts to close this operating gap and move into surplus’. We certainly would not share your confidence. In my original letter I advised you of the following concerns which your response has failed to address :- · The reason why our cinema closed at short notice is entirely down to mismanagement by PACL through non payment to the ICO for film hire charges and meeting licensing obligations. We the residents of Penarth have thus been deprived of one of our best cultural assets in the town entirely due to mismanagement and NOT lack of support. · An entirely deficient marketing strategy which is borne out by the number of local people who STILL did not realise there was a cinema in the Pavilion. · Regular reports of commercial business opportunities being turned away or enquiries not followed up · Suppliers who have not been paid for services provided · Turned down offers of help and support and adopted a policy of complete non engagement with the community on which it depends · A hugely diminished volunteer base which has arisen due to poor management. Your comments on these points would still be appreciated. In your response you refer to the fact that the latest grant is not a ‘bail out’. In my original letter to you I was explicit in my questioning of the award of further public money and was careful not to refer to it as a ‘bail out’. However as you have made reference to that I would emphatically say that the latest award of £126k is absolutely akin to a bail out. As you know PACL previously received £200k from the Coastal Communities Fund for a similar objective yet has completely failed to manage the Pavilion in a manner that secures its viability and meets even the most basic financial obligations and good management.Evidence suggests that original award was completely wasted How can anyone justify awarding such a further large sum to an organisation with such a poor record of management. Your own criteria for awarding this latest grant specifies includes: The current position of your organisation and the circumstances that have led to this point? That the previous Coastal Communities Fund grant completely failed to produce the agreed objectives The extent to which your Resilient Heritage project offers value for money? The record of PACL in managing all aspects of the Pavilion clearly highlights value for money concerns How capable your organisation is of carrying out this project? The turnover of both trustees and staff highlights management problems. Both PACL and PPP failed to submit their Annual Return/Confirmation Statement by the due date with its Confirmation Statement to Companies House still outstanding The extent to which your proposals are well planned and financially realistic? The extent to which outcomes will be sustained after the project The impact achieved with the original HLF grant Clearly the evidence of actual performance highlights serious concerns The extent to which those achievements are now at risk Your comments on these points would still be appreciated You say that ‘I hope you can see that Penarth Arts and Crafts has recognised some of the weaknesses of the organisation’ Sadly none of us can see this given PACL has operated in a totally closed and arrogant manner . As my original letter clearly stated ‘Nobody from PACL has been prepared to engage with local people or groups to listen to legitimate concerns and suggestions about a way forward. Total non engagement is surely wrong and from my own experience of dealing with Lottery funding is completely at odds with the need to have community support and engagement Your comments on these points would still be appreciated In your response you say ‘The ultimate aim is to ensure the building is open to the public as much as is practically possible within the current income constraints. Income has to match expenditure if the building is to have a long term sustainable future. After three years of operation, Penarth Arts and Crafts Ltd maintain they have a much clearer picture of how and when the public use the pier and its facilities, and like any other organisation driven by commercial concerns, will continue to adjust the building opening times in response.’ This makes no mention of the publicly funded state of the art cinema which is now effectively mothballed. It is the one aspect of the Pavilion that the residents of Penarth and further afield appreciate and use. It was closed suddenly not due to lack of support but failure on the part of PACL to pay the ICO and comply with other licensing obligations. How can this be evidence of good management? As you have funded the provision of the cinema ( part or full) then what assurance have you got from PACL that it will be reopened? When will this be? And will it be on the same basis as before in terms of programme provided? The cinema is the one activity loved and appreciated so is clearly crucial to the success of the Pavilion. If PACL does not want to continue to operate it ( or cannot) then clearly you could begin a dialogue with PACL and stakeholders ( including the community) over finding an alternative operator? Your comments on this would be appreciated Your response goes on to say ‘ However I also believe some of the criticism of Penarth Arts And Crafts Ltd has been both unfair and unhelpful. In my dealings with the staff and trustees of Penarth Arts And Crafts Ltd, what comes across very clearly is that they also really care about the building and are working incredibly hard to secure its long term future.’ Unfortunately the evidence locally does not in any way support this so it would be extremely useful and helpful if you could elaborate on this in order for us to understand what specific criticism is unfair and unfounded? Your comments on this would be appreciated For the record I just want to clarify that there is no criticism by anybody of the operation of Penarth Pier by the Vale of Glamorgan Council which manages it exceptionally. All the criticism is justifiably directed at PACL as the leaseholder of the Pavilion where there are very clear matters of public interest about the way it is being managed Finally I did end my original letter to you by saying that I thought that local people are entitled to some explanation, reassurance, open engagement and an opportunity to ask questions – surely it is not too much to ask for at least an open meeting with yourself and representatives from the Vale of Glamorgan Council and PACL? I am assuming that as you have not specifically addressed this that you do not consider that to be an appropriate way forward? Your comments on this would still be appreciated I am sure that you will understand that the future of the Pavilion - and in particular at this point in time it’s wonderful state of the art community cinema – are vitally important to local residents and there remain many unanswered questions not least of all as highlighted above I look forward to hearing from you Yours Sincerely Andrew Jones