Commonwealth Games charity facing questions over £118k black hole
APUBLICLY funded charity set up to deliver a Commonwealth Games legacy project is under pressure over a £118,000 black hole in its finances. The People’s Development Trust, in the east end of Glasgow, also reported net “liabilities” of nearly £90,000 and auditors warned there may be “significant doubt” about the organisation’s ability to continue as a “going concern”.
It was created in 2011 to oversee the Dalmarnock Legacy Hub project, a community facility that offers childcare, health and training services under one roof.
The project received £3 million from the Scottish Government, around £1.3m from the Big Lottery Fund (BLF) and £1.23m from Clyde Gateway, while the local council gave the trust land for a peppercorn sum.
Football legend Kenny Dalglish was the star attraction at the Hub’s opening in 2015, an event also attended by political luminaries such as senior Labour councillor Frank McAveety and SNP minister Jamie Hepburn.
However, although the Hub was supposed to “maximise economic opportunities for local people” following the 2014 Commonwealth Games, the PDT has been dogged by allegations over its financial affairs.
The BLF brought in international auditors over concerns about how its award had been spent, and Police Scotland also received a complaint. In official filings to Companies House the PDT accounts for the year ending March 2016 lay bare the charity’s financial troubles.
An independent auditors’ report to trustees stated: “With respect to expenditure amounting to a value of £118,672, the audit evidence available to us was limited owing to inaccurate record keeping by the charitable company. We have been unable to obtain sufficient appropriate audit evidence
The games were a triumph for the city, but the performance of this charity risks putting a major dampener on that
regarding the occurrence, accuracy and valuation of this expenditure which is included in the financial statements using other audit procedures.”
Of the £118,672, £59,798 arose in the year covered by the accounts, while £35,819 related to the previous 12 months. The accounts added: “This has been investigated externally and £8,320 has been accounted for inaccurately and is currently the subject of legal proceedings.”
According to the report, the PDT was also in debt: “It now also has a net current liabilities position of £89,199, which … indicate the presence of a material uncertainty which can cast significant doubt about the charitable company’s ability to continue as a going concern.”
Two individuals, including former Labour councillor Yvonne Kucuk, who had a paid job at the Hub, were charged last year with allegedly embezzling around £9,000. The summary case is scheduled to call for an intermediate diet in November.
Glasgow Tory MSP Annie Wells said: “It shouldn’t be difficult to run an organisation ensuring there is a worthwhile legacy for Glasgow from the very successful Commonwealth Games.
“But this is yet another damning development and it’s something the Scottish Government needs to get on top of. The games were a triumph for the city, but the performance of this charity risks putting a major dampener on that.”
A spokesperson for the PDT said: “We have worked extremely hard over the last 18 months to address historical issues that have affected the PDT. We have now recruited a full new staff team, implemented new robust financial polices and procedures that have been approved by our funders. Having now recruited a new board we believe the organisation is in now in a position to meet the aspirations of the Dalmarnock community.
“This hard work and commitment has been further highlighted by the current financial position of the PDT, for the financial year 2016-17 we show the organisation has generated a surplus. This a fantastic achievement considering the financial position of the organisation in 2015-16.”
Kenny Dalglish was the star attraction at the legacy Hub’s opening in 2015