A COMPANY sharply criticised by auditors will receive at least £500,000 in public funds to keep running the Pyramids Centre.
Southsea Community Leisure Limited was yesterday approved by Portsmouth City Council to continue operating the seafront swimming pool for a further eight months while its contract is put out to tender.
It follows a damning internal audit report which pinpointed ‘systematic failures in management and financial controls’ which had left the operator ‘exposed to a critical degree of financial failure, fraud and reputational damage’.
Other concerns included CRB checks not being done, too many friends and relatives being employed, proper stock records not being kept and a VAT receipt being amended.
During a debate in Portsmouth Guildhall the Lib Dem administration came under fire for loaning the company £1.3m since 2009, which it now accepts may never be repaid.
Conservative group leader Simon Bosher said his party voted not to give SCLL any more money, but their calls for an independent report were rejected.
He said: ‘It is absolutely appalling that we are looking to put another several hundred thousand pounds into this company.
‘The audit report said we should not give them another penny unless they change their business plan – but that is exactly what the Lib Dem administration has voted to do.
‘This process is now going to last at least eight months and could go on a lot longer. It is time we seriously ask ourselves if keeping the Pyramids open is a viable option.’
The Labour group voted to demolish the building, which leader Jim Patey said had grown too expensive in the current financial climate.
‘It’s becoming a bottomless pit,’ he said. ‘Glass buildings cost a lot to maintain and you can’t just keep pumping money in while cutting other services.
‘We think the site should be sold and the money should be put into other facilities like the Mountbatten Centre.’
But council leader Gerald Vernon-Jackson said, short of demolition, continuing to prop up SCLL was the least expensive option for taxpayers.
He said: ‘It was the cheapest option – to leave them in charge while we see who else we want to run it.
‘The moment we take over and run it ourselves we have to pay £250,000 in business rates. The only other option is to close it for eight months and that is just going to drive people away.’
He added that council officers will now sit on the Pyramids board to ensure the failings highlighted by the report are put right. A second audit report will be produced in February.
Report kept secret
DEMANDS from Conservative councillors to make the damning Pyramids report public failed at yesterday’s meeting.
The reason was legal advice from city solicitor Michael Lawther, who said it could be defamatory if it wasn’t kept secret.
The debate was then held in private after only the Tory group voted to make the report public.
Conservative Donna Jones rejected the option of just not mentioning the confidential document.
‘The public gallery was almost full,’ she said. ‘And those people have a right to hear how their taxes are being spent by this council.’