Monday, November 22, 2010

Should Town Council facilities be run at a profit?

There seems to be a notion in St Neots Town Council that services should be run at a profit or break-even. But not all services. Open spaces and Play Areas need lots of money to maintain and money for this is paid out of the Council Tax raised. No charges here then.

The Priory Centre and the ECC are both examples of public services which shouldn't run at a profit. Nor with the likely maintenance costs are they likely too. The cost of these should be paid by the Council Taxpayer. What the Town Council should be looking at is the acceptable cost to the Council Taxpayer and the users of the service. 

Looking at the Priory Centre, this is a prime example of wishing it could break even over 5 years. This is impossible. The budget shows just why. The Priory Centre is budget to lose £112,135. This is before any capital expenditure is added.

To cut this loss the Town Council would have to triple the bar profit or double the hire charges. The only other alternative is to cut the staff. Jacking up prices will only move customers on. 

The Town Council has to come to terms with Public Services cost money. Setting targets which cannot be achieved may look good to the Public but they restrict staff and eventually they leave. 

I actually feel a budgeted loss of £100,000 is roughly right for The Priory Centre. Yes, the Town Council should bear down on costs. Yes, the Town Council should give the Manager the right to manage the facility rather than meddling with the prices. But don't make it impossible.

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