Public finance threat to be 'amber'

The financial threat posed by £72 million Black Country arts centre The Public is set to be downgraded from red to amber despite an auditors' report warning that its £1.1 million a year budget is not enough.

Councillors in Sandwell were meeting tonight to discuss the damning report into the costs of the gallery in New Street, West Bromwich.

Respected auditors KPMG has advised Sandwell Council to consider all its options including mothballing or even demolishing the gallery if it finds the £1.1 million a year it has allocated falls short.

But council chiefs are proposing to reclassify the threat The Public poses to the council's finances as 'amber'.

Executive director for adult and community services John Garrett said: "As a result of all activities undertaken in the past three months a reduction in the probability score is suggested, resulting in a current score of amber."

KPMG's report, revealed by the Express & Star last week, showed that The Public has now cost £49 million more than originally planned.

Sandwell Council, which recently set up Sandwell Arts Trust to run the building, has said that demolition and closure are not options. The council's own audit committee first gave The Public a threat level of red for the risk it posed to the council's reputation and finances when it met in April.

At that time the costs of The Public stood at £65 million but have since risen a further £7 million according to KPMG's latest research.

Auditors from KPMG were expected at the meeting at 6pm this evening at the Council House in Oldbury to explain their findings and answer questions from councillors.

In a passage entitled Challenges Now Facing The Authority KPMG said it was vital that Sandwell Council "consider alternative uses and their operational and financial impact – this should include the consequences of "mothballing" the building if operating it becomes too costly".

Councillor Bob Badham, Sandwell's cabinet member for regeneration and transport, said: "The council has consistently taken the view that we were investing in valuable creative, educational, economic and regeneration opportunities for the borough. We have remained supportive to these aims throughout and we are confident this will be a success."

Meanwhile, a West Midlands MEP today called for the council to try and sell off the troubled arts centre.

Conservative MEP Philip Bradbourn called for a sell-off in the wake of the damning report from auditors KPMG.

Mr Bradbourn said: "The fact that KPMG have issued a report regarding The Public which states that the project was founded upon a "flawed and unclear business case" reinforces my position that it should be sold for a different, profitable purpose so that the taxpayer can stop paying millions of pounds for the incompetence of Sandwell Council and those involved in this debacle."