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Revealed: The truth behind Ally Pally deal

PUBLISHED: 16:19 25 September 2008 | UPDATED: 15:26 07 September 2010

Campaigners are urging Haringey Council to stop politicising Alexandra Palace and have called for an independent trust to manage the palace. The call follows a report that expressed concern about the way Ally Pally is run. Jacob O Callaghan, who took the

Campaigners are urging Haringey Council to stop politicising Alexandra Palace and have called for an independent trust to manage the palace.

The call follows a report that expressed concern about the way Ally Pally is run.

Jacob O'Callaghan, who took the trust to the High Court last year, said: "A local council trying to run this building doesn't and can't ever work. That has to change. The trust needs to be in the hands of a national body. It's got to be independent and non-political."

The Alexandra Palace and Park Charitable Trust was set up by Labour-led Haringey Council in 1981 and comprises four Labour and three Lib Dem councillors.

Trustees will meet tomorrow to discuss the independent review of the deal with Firoka, which expressed concern at the lack of governance shown by the trust, as well as looking for a new PR company.

The trust has sacked its PR consultants Lexington, who have been paid £182,000 since 2005, and are now interviewing for a new company which will demonstrate "value for money".

"The evidence in the report is very shocking," Mr O'Callaghan said. "About £3.5 million has been lost because Firoka were like squatters - they took all the money from the events and didn't give any back to the charity or council.

"Officers were not telling the council or the trust the risks involved in the contract."

Martin Walklate, author of the report ,criticised the fact that the Trust does not have a formal code of governance and that no final legal approval or independent advice was sought before signing the Firoka licence.

"The governance regime surrounding the preparation and authority of the licence must be considered questionable at best," he said.

Mr Walklate was also concerned about the terms of the contract, which includes the ice rink, while paying no rent on the building. "Firoka were given a very advantageous contract, presumably with the intention that this would facilitate the signing of the master lease," he said.

Mr Walklate believes the trustees were ill-informed in making the decision and the report seeking authority from them was "hurriedly produced".

"I can find no evidence that any substantial briefing took place to ensure that trustees were sufficiently informed to make this key decision," he continued.

He also criticises the trust for not considering any other alternatives to a licence, calling it "unacceptable".

He said: "It is clear that the licence was developed without consideration of any other alternatives."

Another concern was the company's deteriorating income, which had dropped from more than £1.25 million in May to July in 2006 to £245,000 in the same months in 2007. Mr Walklate said: "It is clear that the trading company was in danger of being viewed as insolvent. The cause of this is, however, less clear.

"David Loudfoot [Ally Pally general manager] is clear that this situation was not engineered but it does appear that the decline in revenues is exceptional."

Trust chairman Cllr Matt Cooke said: "Whenever issues from the past have been brought to the palace board throughout the last year, the trust has acted to resolve them in the best interests of the palace's future.

"It is extremely important that we now have complete commitment by the trust to ensure that these outstanding issues which have come to light are understood and all the necessary lessons are learnt."

SUMMARY

o The trust was criticised for no formal code of governance.

o The trust sought no final legal approval or independent advice before signing the licence.

o The terms of the contract were very advantageous for Firoka and differed vastly from previous contracts.

o The trustees were ill-informed to make the final decision.

o The trust did not consider any other alternatives.

o Confusion surrounds revenue figures and other matters.

Recommendations:

o Installing a monitoring system to ensure a review of standards.

o Creating a code of governance.

o Clarifying procedures for briefing trustees.

o Fully reviewing existing contracts for other services.

o Creating a protocol which maintains charity's autonomy and relationship with Haringey Council, after the review showed a "confusion of roles".

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