Report for councillors: Update on the financial position of The Princess Theatre
Issued to: Finance & Resources Committee Meeting 6th July 2020
Purpose of Report to provide financial information about the impact of the Covid-19 closure on The Princess Theatre and Art Centre
The Princess closed on 20th March due to Government guidelines. It is a public venue that holds mass gatherings, so it falls within the last phase of lockdown easement, it is reasonable to assume that The Princess will not achieve it’s normal level of income for some time.
Unlike other theatres and arts centres, The Princess has so far been unable to maximise government support with the expanded retail discount, the subsequent grant or the Covid Job Retention Scheme due to being a local authority operation with a subsidy greater than its income for 19/20. As it is run by a local authority, the budget has already been agreed and it is therefore not expected to make any of its staff redundant. However, recent talks with Sedgemoor have led to an application being submitted and it is hoped that we may be eligible for a grant from their expanded retail discount scheme.
The princess has lost 94% of the earned income, estimated at £83,950 for 20/21 (£6,995.83 pm) due to the closure.
Taking in to account reductions in utilities due to lack of usage, and having worked hard to reduce contractual commitments, the fixed costs (whilst closed) from June stand at £121,320 annually (£10,110 pm) a saving of £40,058 (£3338.17 pm).
It has already been agreed that the Council has committed £72,428 in the 2020/21 budget. This leaves a shortfall of £48,892 for 2020/21 on fixed costs.
Thanks to the grant of £28,649 from the Arts Council’s emergency National Lottery fund the Council will be able to sustain the Princess without income until early February.
That leaves the Council with a shortfall of £16,243 until the end of the financial year. The difference of £4,000 is expected from PV cell income and rental fees.
The Business Development Officer is working on funding to bridge this gap and we are waiting for news from Sedgemoor about the recent application.
The Council may need to use other funds to bridge the projected gap of £16,243
Corporate pillar 2: Culture and Community
The Town Council is committed to supporting a year-round programme of cultural events throughout Burnham and Highbridge, providing improved infrastructure where possible that will benefit the towns and its residents.
The Council should consider what funds it would use to bridge any potential gap in funding. EMR report is attached to this report.
The Council should be aware that reopening The Princess to the public for any purpose comes at a cost of £3,338 per month, and that this cost cannot be recovered from income earnt from events for some time due to Covid-19 restrictions and social distancing measures.
Report author: Sally Jones and Beccy Armory
Report Date: 26th June 2020