South Wales Evening Post - 31 October 2006
Swansea Council bosses could have done more to stop the city's showpiece £27 million stadium losing so much cash in its first year, according to a new report.
The Liberty Stadium recorded losses of £780,000 during its first season and had to have a £2.3 million loan from the council written off.
Council auditors PriceWaterhouseCooper have criticised mistakes by stadium management and senior councillors for not acting quickly enough to limit losses.
Councillor Gerald Clement, a director of stadium management company StadCo, said things had improved.
The PWC report was heavily censored before being released to the public.
This means details of how cash was spent in the first year of operation, and how Swansea Council uses its controlling stake on the board, remain secret.
Councillors John Hague and Gerald Clement are Swansea Council's representatives on the stadium's management committee, and Councillor Clement said mistakes had been ironed out.
The report said some of the problems resulted from the loss of StadCo's chief executive within months of the stadium opening but said more could have been done to prevent first-year losses.
It said: "It is possible that some of the losses made by SSMC in 2005/6 could have been avoided if there had been proper management information presented to the board at an earlier stage and on an ongoing basis."
The report goes on to say: "Authority members who are directors at SSMC should monitor closely the financial position of SSMC in future, by means of monthly management information reports covering both financial and non-financial information such as attendance levels.
"Where necessary they should ensure that failures to provide this information are addressed as a matter of priority."
Much of the report has been blacked out. Sections that cannot be read include stadium spending figures as well as details of Swansea Council's ability to outvote other directors, from the Ospreys and Swansea City FC.
Labour Group leader David Phillips accused council leaders of not protecting the city's interests in the stadium.
Councillor Phillips said: "This report from the council's external auditors makes very plain that the council's directors failed to ask for financial and management information and did not pursue its absence because they did not see it as a priority.
"Of most concern, however, is the auditors' unequivocal opinion that had they sought this information some of the company's losses could have been avoided."
Councillor Clement said that mistakes were made but lessons had been learned.
He said: "We have recognised the accounting processes were not sufficiently robust. We have also got a new chief of financing.
"Things happened and we spotted them and tidied up the process but this doesn't happen over two days.
"Everyone involved in the stadium is confident we have got it right now."
