A council finance chief claimed he would need a “crystal ball” to be able to predict the ultimate impact of the pandemic on Aberdeen’s ailing arts organisation.
Jonathan Belford has briefed councillors on the hardship faced by the local authority’s arms-length external organisations (ALEOs) set up to run a number of local services.
The audit, risk and scrutiny committee was considering the financial position of bodies including Aberdeen Performing Arts (APA), Sport Aberdeen, Aberdeen Sports Village, Bon Accord Care and Aberdeen Heat and Power.
The risk was upgraded to “high” at APA this month, with it looking increasing unlikely the organisation will be able to fully re-open until April 2021, Mr Belford’s report said.
As of last week, 96% of its staff remained on furlough.
The culture ALEO runs His Majesty’s Theatre, the recently renovated Music Hall and the Lemon Tree.
Asked if anything more could be done to mitigate the potential risks, chief finance officer Mr Belford told councillors: “That’s a challenging question.
“You’d need a crystal ball to understand what the environment will look like and when to plan to open and get a customer base back in.
“In terms of where we are mitigating, what we have seen is the organisations including APA have accessed government funding where available, the grants and so on.
“I do not doubt the support scheme will continue to add further to that.
“It is difficult to mitigate that risk directly at this moment – we have to continue to monitor that and work closely with ALEOs to maintain an understanding of what the situation is.”
On Wednesday, Mr Belford gave evidence at a meeting of Holyrood’s local government committee, outlining the financial impact of the pandemic on council coffers.
He highlighted the plight of APA and Sport Aberdeen – rated at medium risk in his report – on the national stage.
Mr Belford said there was a “clear and immediate impact” on council ALEOs where customers were the main source of income.
“In terms of scale, it would be helpful maybe to say, from an Aberdeen perspective, that amounts to about £20m of external customer income that was immediately switched off,” he told the Scottish Parliament committee.
“So they went into a particularly challenging position.”
But council bosses and ALEOs have been in weekly contact since the onset of the lockdown – and the officials have backed the course the organisations have taken through the emergency.
Mr Belford told councillors the risk rating, looking at the financial danger to the council, was “more about the environment we are in” than the management of the organisations, which he hailed as having proven “particularly effective”.
But he added: “If restrictions and changes aren’t lifted next year then undoubtedly we do have an environment that presents a higher risk to the council.”
There is no definite date for Sport Aberdeen’s many venues to become fully operational again – and the same was noted about the separate Aberdeen Sports Village.
The impact of the pandemic on Bon Accord Care – the ALEO running council care homes – was also noted by councillors.