Agenda item

            (Mr. P. McNaney, Chief Executive, attended in connection with this item.)

 

            The Committee considered the undernoted report:

 

“Relevant Background Information

 

      At a meeting of the Strategic Policy & Resources Committee on 14 December 2007 Members agreed to provide £1.25m of funding from the City Investment Fund to the Lyric Theatre, subject to ‘detailed negotiations and final approval by the Council on the schedule of payments, full recognition being given to the Council in respect of its contribution, the Lyric Theatre being requested to consider Council representation on its Board and a commitment from the Lyric Theatre to undertake an outreach programme in the wider Belfast community’.

 

      The Development Department has taken forward discussions with the Lyric Theatre on the funding conditions and briefed Legal Services which has completed the draft legal agreements which are now ready for signature.

 

      The purpose of this report is to brief Members on the progress which has been made and to receive a presentation from Ciaran McAuley, the Chief Executive of the Lyric Theatre, on its education and outreach work, the progress with fundraising and the present state of construction work.

 

      The Committee will then be requested to make a recommendation to the Strategic Policy & Resources Committee, which will have to be briefed by the Director of Finance & Resources in relation to the schedule of payments and the release of funding.

 

      Currently, BCC provides funding to the Lyric through the multi?annual funding scheme to the value of £37,971 for the financial year 2010-2011 to cover programming costs.

 

Key Issues

 

      The total cost of the Lyric project is £18m.  Funding support is coming from a number of sources including:

 

-     Department of Culture, Arts and Leisure £9.4m

 

-     Lottery Funding sourced through the Arts Council £2.4m

 

-     BelfastCity Council contribution of £1.25m. 

 

      This is 73% of the total funding of the project.

 

      The remaining 27% of funding is being raised by the Lyric themselves.

 

      This 27% amounts to almost £5m.  The Lyric have now confirmed that £4.75m of this amount has now been sourced from private donations and philanthropic trusts.

 

      A schedule of payments has been agreed through Legal Services and the Director of Finance and Resources and the first Council payment would be due in April 2010 subject to final Council approval.  This money is required to maintain the cash flow required for the construction project.

 

      CONDITIONS – Full recognition for

      Council contributions

 

      The Lyric Theatre has provided full recognition of the Council’s contribution to the project in all its promotional material since the Council funding decision in January 2008.  Since that time the Council has been recognised as one of the foundation supporters of the rebuild project and the Council’s logo has been prominently displayed on promotional material produced by the Lyric Theatre in relation to the project.  The Council was represented by the Lord Mayor at the unveiling of the foundation stone of the new Theatre in September 2009 and the Lord Mayor wrote the foreword to the event programme.  The Lyric has committed to giving full credit to the Council as one of the foundation partners and the Council will be so credited at the opening of the new Theatre and in all the promotional material associated with the opening.

 

      CONDITIONS - Representation on the

      Board of the Lyric Theatre

 

      Following the Council decision to provide funding, Council officers relayed to the Board of the Lyric Theatre the Council’s wish to have representation on the Board.  In response the Lyric has advised us that since its foundation 50 years ago the Board has never included representatives of any corporation, funder or collective interest.  A full scale review of the governance of the Board was conducted 2 years ago which resulted in the drawing up of a new memorandum and articles of association (the legal document which forms a limited company).  These memorandum and articles of association for the Lyric expressly forbid corporations to be members or trustees of the Board which is constituted as a charity.  As a constituted charity the Lyric will not pay VAT on the construction contract for the new build.  It is normal practice in such circumstances for funding bodies not to be represented on a charitable organisation claiming such relief from construction projects.  Other funders such as the Arts Council are also not represented on the Board, they operate ‘on the arms length principle’ which follows good governance advice in not placing representatives of funding organisations on the board of arts organisations to avoid conflicts of interest.  The Lyric has indicated that, unlike other arts organisations in Northern Ireland, it is a producing Theatre which commissions and works with new artists to produce pieces for performance in the Theatre.

 

      The Lyric recognises the Council’s need as a funder to be reassured on how the construction of the new building is proceeding.  To this end the Council has been offered representation on the Project Board which is overseeing the project which comprises all the investment decision makers, currently the Arts Council of Northern Ireland, DCAL and the Council.  The Lyric also recognises the Council’s concern on its education and outreach activities and to this end has agreed to set up an Education and Outreach Advisory Committee which will be served by the Lyric Education Officer.  The job of the Committee will be to provide advice on education and outreach activities.  The Lyric would be pleased to have 2 Council representatives on this Panel and have further offered to update the Council on an annual basis of its outreach and education activities by attendance at a meeting of the Development Committee.

 

      It should be noted that, at the Council meeting on 5 January, 2010, it was agreed that the Chief Executive of the Lyric Theatre be advised that the Committee will wish to raise with him during his presentation to the Committee the refusal of the Board to agree to the Council’s request to be represented on the Board and that the Council finds this position entirely unacceptable, given the level of financial support which has been provided to the Lyric Theatre.

 

      The Chief Executive has been so advised.

 

      Education and Outreach

 

      As outlined above the Lyric Theatre has recently appointed an Education Officer whose job will be to further develop an education and outreach programme during the time the Theatre is being built and to develop a full programme of activities once the Theatre is in full operation.  The commitment by the present Chairman of the Theatre to its education programme is available on the Lyric’s website, together with details of the recent education programmes such as the Boatyard programme which was an initiative involving 6 local primary schools in North and East Belfast and related the history of Belfast’s shipbuilding past.  The Theatre is presently developing its Pat and Plane project with 12 primary schools throughout Northern Ireland looking at the development of the linen industry.  The Theatre also run schools for aspiring actors in the 18?24 age range and a whole range of individual projects.  The Lyric Theatre has recently appointed a new Education Officer from 1 March 2010 and the Chief Executive of the Theatre, Ciaran McAuley, will further update the Committee on the education programme.  The Theatre has committed, in the legal agreement, to undertake an education and outreach programme in the City.

 

Recommendations

 

      Committee are requested:

 

1.   To note the information provided and receive a presentation from the Chief Executive of the Lyric Theatre.

 

2.   To note the proposal by the Lyric Theatre that the Council be represented on the Education and Outreach Advisory Committee and the Construction Project Board.

 

3.   To make a recommendation to the Strategic Policy & Resources Committee on whether the funding conditions have been satisfied.

 

Decision Tracking

 

      There is no decision tracking attached to this report as it is for notation only.”

 

            The Chief Executive stated that if the Committee decided to support the Lyric Theatre project then a report would be submitted to the Strategic Policy and Resources Committee in connection with the development of a funding agreement between the Council and the Theatre.  He advised the Committee that the Lyric had raised privately almost £5 million, which equated to 27% of the overall costs of constructing the new Theatre.

 

            The Committee was advised that Messrs. Ciaran McAuley, Chief Executive, and Dan Gordon, Board Member, were in attendance to address the Committee.  Accordingly, the deputation was admitted to the meeting and welcomed by the Chairman.

 

            Mr. McAuley thanked the Committee for the opportunity of addressing it and, with the assistance of visual aids, advised the Committee that the Lyric Theatre, which had been established in 1951, was Northern Ireland’s only full-time producing theatre and was the largest employer of professional theatre practitioners in the Province.  He informed the Committee that:

 

(i)     the Theatre attracted audiences in excess of 50,000 per annum, half of which came from Belfast;

 

(ii)    the Theatre held an average of 250 performances per annum and, on average, operated at 66% capacity; and

 

(iii)   research which had been undertaken had established that less than 10% of its audiences lived in the BT9 postcode area, 12% of its customers earned less than £7,500 per annum and 8% of its audiences lived in the 100 most deprived areas of Northern Ireland, thus demonstrating that the Theatre’s attraction was widespread both geographically and across all income groups.

 

            He informed the Committee that the Theatre’s strategic objectives included:

 

·         providing a centre of excellence for the local theatre and arts communities;

 

·         enhancing the quality of life in the City;

 

·         building key partnerships in Belfast and beyond; and

 

·         meeting the needs of major stakeholders, particularly the Arts Council for Northern Ireland, the Department of Culture, Arts and Leisure and Belfast City Council.

 

Mr. McAuley displayed artists impressions of the new building and informed the Committee that the new Lyric Theatre would provide the City with an £18 million state?of-the-art facility which would have a 390 seater auditorium and a 110-150 seater second space, an education and outreach suite, a rehearsal room and spacious foyers.  It was intended that the artistic programme of the new Theatre would involve both repertory and studio productions, an education and creative learning programme and artistic partnerships and co-productions.

 

            Mr. Gordon advised the Committee of the education and outreach work which the Theatre had undertaken in recent years and indicated that, in 2008, a project had been undertaken in 30 Belfast schools and that, currently, the Theatre was working with 4 Belfast schools and 8 schools outside the City.  He informed the Committee that these projects had been well received by both the pupils and teachers and he reminded the Members that the Theatre had appointed recently an Education Officer who would be seeking to expand upon this education and outreach work.

 

            Mr. McAuley indicated that he was aware of the Council’s concern at not being represented on the Board of the Theatre but pointed out that the Theatre’s Memorandum and Articles of Association prevented funding organisations such as the Council from becoming members or trustees of the Board as it was constituted as a charity.  He explained that, as a charity, the Lyric Theatre would not be required to pay Valued Added Tax on the construction costs of the new facility and he was concerned that, if the Council were provided with a seat on the Board, this could be challenged and result in the Theatre having to pay this Tax.  This would add considerably to the construction costs.  He indicated that the Theatre was intending to establish an Educational and Outreach Advisory Committee and would be offering the Council two places on the Committee.  He indicated also that he would be happy to appear before the Committee on an annual basis to update it on the work of the Theatre and, in particular, the outreach and education activities.

 

            Messrs. McAuley and Gordon then answered questions which were put to them by the Members.  During this discussion they indicated that:

 

(i)     the Theatre was already working in disadvantaged areas and was keen to work with Irish language schools;

 

(ii)    the recently appointed Education Officer would be co-ordinating the Theatre’s education and outreach work to ensure that there was no duplication with other organisations;

 

(iii)   the Board of the Theatre was quietly confident that it would be able to raise the remaining £250,000 which was required to enable the construction costs to be met;

 

(iv)   the City’s ratepayers would be obtaining a state-of-the-art £18 million theatre in return for the £1.25 million investment which the Council would be providing to the Theatre;

 

(v)    the new facility would be a world-class theatre which would attract visitors to Belfast;

 

            The deputation thanked the Committee for the opportunity to address it and Messrs. McAuley and Gordon retired from the meeting.

 

            During a lengthy discussion, the Chief Executive answered various questions and assured the Committee that advice would be obtained from the Director of Legal Services regarding any possible conflict of interest which Councillors might have in relation to their membership on organisations which were involved in new-build schemes, such as the Lyric Theatre and the Metropolitan Arts Centre, and that the Council’s constitution, which was being prepared currently, would include guidance on those governance issues which had been raised during the meeting.

 

            Following further discussion, it was

 

Moved by Councillor M. Browne,

Seconded by Councillor C. Maskey,

 

      That the Committee agrees:

 

(i)   to note the information provided by the deputation from the Lyric Theatre;

 

(ii)  to accept the offer from the Lyric Theatre that the Council be represented on the Education and Outreach Advisory Committee and the Construction Project Board and to receive an annual presentation from the Theatre on its work; and

 

(iii)to recommend to the Strategic Policy and Resources Committee that, since the funding conditions had been satisfied, the amount of £1.25 million be awarded to the Theatre from the City Investment Fund.

 

            On a vote by show of hands eleven Members voted for the proposal and one against and it was accordingly declared.