EDINBURGH’s main business group has been left in crisis, with a dozen staff set to be made redundant as it struggles with a £1 million loss.
The Edinburgh Chamber of Commerce has told 12 of its 50 members of staff that they will have to go to help it to overcome its financial problems.
It is understood that the severity of the financial crisis was part of the reason for long-serving chief executive Ron Hewitt announcing last month that he is to quit.
The Evening News understands that the precarious financial position has been caused by a loss of nearly £1m at Edinburgh Business Development (EBD), a trust run by the Chamber that helps support businesses to grow and provides training programmes to help people get back into work. It is part of a consortium that delivers Business Gateway services in Edinburgh.
Graham Birse, managing director of the Edinburgh Chamber of Commerce, said: “The past year has been challenging for EBD and for Edinburgh Chamber of Commerce.
“Trading conditions have been difficult and, in common with many private sector companies at this time, we have had to implement a redundancy and restructuring programme.”
Mr Birse said he was not willing to provide details of the financial position of the company before discussing it with members at its AGM, which is being held on October 20 at The Hub on Castlehill.
But he confirmed that the AGM is happening later in the year than usual because of delays in the completion of audits and “finalisation of accounts for all companies”.
Last year, the Chamber posted a surplus of £211,016, which was well up on the £145,885 figure of 2009-10. EBD brought in £2.5m of income – mainly through providing training on behalf of third parties – and produced a £79,040 surplus.
But business sources say that the problems at EBD, which helped support 1585 new businesses in 2009-10, are mainly behind the precarious position.
It is understood that the number of contracts it has secured has dramatically reduced in the last year.
Although full restructuring details have not been revealed, the future of the Chamber or EBD is not thought to be at risk.
Councillor Tom Buchanan, the city’s economic development leader, said: “Obviously, the council is concerned when any organisation it partners up with meets with financial difficulties. If there is anything that we can do to assist them, we will look to do that.”
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