Council to write off £230k climbing centre debt

Artist Tessa Lynch used the centre to perform. Picture: Neil Hanna
Artist Tessa Lynch used the centre to perform. Picture: Neil Hanna
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CITY bosses are set to write-off a £230,000 debt owed by a loss-making climbing centre – just weeks after agreeing to replace its roof at a cost of almost £1 million.

A report has revealed that the Edinburgh International Climbing Arena (EICA) in Ratho is “highly unlikely” to make a profit in the foreseeable future and urged finance chiefs to forget about recouping the loan provided in 2007.

The climbing centre opened in 2003 before closing two years later when its owner went into receivership and reopened in 2007 under the leadership of Edinburgh Leisure, an arms-length council firm.

The city spent £3.87m buying the facility and a further £5.82m completing it, with it now considered a “world-class climbing facility and a centre of excellence in its field” with 260,000 customers expected to visit this financial year.

It is said to contribute £2.1m to the Edinburgh economy by hosting climbing events.

Edinburgh Leisure, which was granted a 44-year lease, received a one-off cash boost six years ago to address ­predicted operating losses of £380,000 in its first year and beyond. Since then, only £150,000 has been repaid, with finance chiefs now set to cut their losses. The facility is not, however, propped up with an annual subsidy like others.

The news comes just weeks after the city’s culture and sport committee approved spending £940,000 on replacing its roof.

In the report, Alistair MacLean, director of corporate governance said: “The proposed write-off of a £230,000 loan to Edinburgh Leisure is set against an existing provision made by the council for that amount, and will thus have a neutral effect on the council’s budgeted position.”

And he added: “Meanwhile, the loan which cannot realistically be repaid from the EICA’s operation or from other Edinburgh Leisure resources remains a burden on the company. Discussions with Edinburgh Leisure during 2011 had indicated that the loan could not be repaid as scheduled and provision was made for the potential non-payment in the council’s 2011-12 accounts.”

Councillor Alasdair Rankin, finance and budget convener, said: “The EICA continues to perform well under Edinburgh Leisure’s management with visitor numbers showing impressive growth year-on-year while, at the same time, hosting international events such as the IFSC European Youth Cup in June.

“This has resulted in a steady reduction in the centre’s annual deficit, in line with the revised business plan. Provision was made in last year’s accounts to write this loan off and it will have no impact on this year’s budget.”

Graeme Gardiner, director of operations, for Edinburgh Leisure – which is expected to lose £250,000 this financial year – said: “The EICA has continued to establish itself as a key visitor attraction for the people of Edinburgh and beyond. With a projected total of 260,000 visits for this financial year, it is clear the excellent facilities on offer to local, national and international visitors are proving increasingly popular.

“The venue has recently retained its five-star VisitScotland Activity rating and we look forward to working with the City of Edinburgh Council to ensure it continues to go from strength to strength.”