A review of the extent of financial problems at Welcome to Yorkshire is being kept secret as the organisation seeks another £1m of funding from local councils.
The company, which is yet to appoint a successor to ex-chief executive Sir Gary Verity following his resignation in March after expenses and bullying allegations, hopes to secure the money from the North and West Yorkshire Business Rates Pool made up of 14 local councils at a meeting on Monday.
Council leaders attending the meeting to make the decision will be shown the findings of an independent review of Welcome to Yorkshire’s finances commissioned by the local authorities - but the details will not be made public.
A report going to the committee meeting on Monday, written by Kirklees Council chief executive and Welcome to Yorkshire ‘board observer’ Jacqui Gedman, said the independent review was “classified as exempt” due to it containing information about financial affairs.
But the published report does state that Welcome to Yorkshire is facing a “challenging” financial position, with cash flow issues delaying the implementation of a series of recommendations of how the organisation can reform following two independent investigations ordered in the wake of ex-chief executive Sir Gary Verity’s resignation in March after expenses and bullying allegations. His successor is yet to be appointed.
It comes after it was revealed last week that Welcome to Yorkshire had borrowed £500,000 from North Yorkshire County Council to deal with “one-off costs” relating to the independent investigations.
Ms Gedman’s report to the committee said: “The financial position of WtY is challenging and there are cash flow issues due to a number of factors, including the one off costs associated with the investigations and the pause of and/or reprofiling of public sector funding.
“Indications are that WtY can recover from the current financial situation.”
She said Welcome to Yorkshire is “reliant” on securing the money from the business rates pool, which had previously agreed to financially support the agency this year but later suspended the release of funding “pending assurances about clear progress on implementing recommendations from the investigations”.
The report has now recommended the funding is granted - despite delays in making promised governance reforms.
It said: “The contribution from the Business Rates Pool is a commitment made before the resignation of the previous Chief Executive and as such has been built in to the WtY budget; consequently the organisation is reliant on this funding.
“Continued funding from the BRP would bring stability to the organisation and enable WtY to continue to deliver events and the boost to the local economy they bring. The current cash flow issues have caused a delay in the increase of capacity within WtY and therefore the recommendations and improvements from the investigation reports have not been progressed at the pace required.”
The report has recommended the money should be granted - but on the conditions that a new chief executive and board members are recruited as soon as possible and governance changes are implemented.
Agency yet to reveal costs of inquiries
Welcome to Yorkshire has refused to say how much the two independent investigations into expenses spending and bullying allegations cost the organisation.
A spokeswoman said a breakdown of the costs - which have been cited as the reason for the North Yorkshire loan - "will be made public in due course".
Interim chair Keith Stewart said the organisation is "hopeful" of receiving the £1m from the local councils next week.
“Welcome to Yorkshire is a not-for-profit organisation which does not have large cash reserves," he said.
“The organisation is under financial pressure due to the one-off costs associated with the investigations and the pausing of public sector funding which had been included in our budget.
"We are hopeful for continued support from the North and West Yorkshire Business Rates Pool Joint Committee which will allow us to rapidly progress the recommendations from the independent investigations and continue to boost the Yorkshire tourism.”