Agenda item

The Russell-Cotes Art Gallery and Museum (RCAGM) with its Grade 2* listed house and internationally significant collections was gifted to the people of Bournemouth in 1908 and was held in trust by Bournemouth Borough Council and its successors, as sole Trustee, ever since. (Charity Reg No 306288).

When making decisions on the Russell-Cotes, the Council, as Trustee, is required to act in the best interests of the charity (rather than the Local Authority).

The Bournemouth Borough Council Act, 1985 superseded previous indentures, and required Cabinet to act as the Museum’s Management Committee. Cabinet has delegated its responsibilities to the Russell-Cotes Management Committee, which acts as a subcommittee. It consists of Councillors and non-voting independent members. It has determined, after detailed investigation that full independence is the best way to safeguard the long-term future of the Museum.

The governance, relatively unchanged for 100 years, is a mix of Local Authority and charity practice which cannot provide appropriate oversight, financial transparency or strategic leadership and does not meet the required standards for a modern charity. Due to the current charitable arrangements there is no opportunity to combine the Russell-Cotes with other local museums.

The Museum building and collections are at risk without substantial investment and the financial burden on the Council will be considerable. The best way to mitigate this risk is to enable the museum to fundraise, but grant-giving bodies have been very clear that whilst the current governance arrangements continue substantial funding is unlikely. Indeed, the Arts Council rejected a recent application for NPO funding, citing inadequate governance.

Whilst there are risks for both the Council and the future charity in pursuing the route of independence, the risks of not doing so are far greater.  The Charity Commission has examined the issues and invited the Council to submit a request for change.

A detailed negotiation of the funding and Service Level Agreement arrangements will be held between BCP Council and the new Trustee during the transition period as the governance issues are resolved. 

Cabinet recommended to Council that:

The Council agrees:

(a)           that the future of the Russell-Cotes Art Gallery & Museum, for which it is sole trustee, would be best served by externalisation in the form of the transfer of Sole Trusteeship to a new corporate entity (CLG or CIO) to operate and manage the charity;

(b)           as Sole Trustee of the Russell-Cotes Art Gallery & Museum to make a formal application to the Charity Commission for a change of governance under Section 73 of Charities Act 2011 to replace the Council as sole trustee with a new corporate entity (CLG or CIO) acting as sole trustee and for the modernisation of governance articles;

(c)           to establish a Corporate Entity (CLG or CIO) and appoint a Shadow Board of 5 nominees to oversee the transition to independence, provide continuity and stability and to maintain an on-going supportive relationship with the new CLG/CIO;

(d)           to negotiate, during the transition phase, future years grant support for the new Trustee, along with the transfer of assets, lease arrangements etc with an expected vesting day of 1 April 2024 at the earliest; and

(e)           To delegate authority to the Director of Finance, Director of Law & Governance and the Chief Operations Officer to determine the best financial model in consultation with the Portfolio Holder.

Voting: Unanimous

Portfolio Holder: Tourism, Culture and Vibrant Places

Reason

To safeguard the Russell-Cotes Art Gallery and Museum in the longer term.

To modernise the governance arrangements for the charity and enable it to deliver its charitable objectives, fundraise effectively and thrive in the future.

The Portfolio Holder for Tourism, Culture and Vibrant Places presented a report, a copy of which had been circulated to each Member and a copy of which appears as Appendix 'I' to these Minutes in the Minute Book.

Cabinet was advised that the Russell-Cotes Art Gallery and Museum (RCAGM) with its Grade 2* listed house and internationally significant collections was gifted to the people of Bournemouth in 1908 and was held in trust by Bournemouth Borough Council and its successors, as sole Trustee, ever since. (Charity Reg No 306288).

Cabinet was informed that when making decisions on the Russell-Cotes, the Council, as Trustee, is required to act in the best interests of the charity (rather than the Local Authority).

Cabinet was advised that the Bournemouth Borough Council Act, 1985 superseded previous indentures, and required Cabinet to act as the Museum’s Management Committee, and that Cabinet has delegated its responsibilities to the Russell-Cotes Management Committee which acts as a subcommittee and consists of Councillors and non-voting independent members, and that it has determined, after detailed investigation that full independence is the best way to safeguard the long-term future of the Museum.

Cabinet was further advised that the governance, relatively unchanged for 100 years, is a mix of Local Authority and charity practice which cannot provide appropriate oversight, financial transparency or strategic leadership and does not meet the required standards for a modern charity, and that due to the current charitable arrangements there is no opportunity to combine the Russell-Cotes with other local museums.

Cabinet was informed that the Museum building and collections are at risk without substantial investment and the financial burden on the Council will be considerable, and that the best way to mitigate this risk is to enable the museum to fundraise, but grant-giving bodies have been very clear that whilst the current governance arrangements continue substantial funding is unlikely, and the Arts Council rejected a recent application for NPO funding, citing inadequate governance.

Cabinet was advised that whilst there are risks for both the Council and the future charity in pursuing the route of independence, the risks of not doing so are far greater, that the Charity Commission has examined the issues and invited the Council to submit a request for change, and that a detailed negotiation of the funding and Service Level Agreement arrangements will be held between BCP Council and the new Trustee during the transition period as the governance issues are resolved. 

A non-Cabinet Councillor commented that this appeared to the best solution for the situation currently.  The Portfolio Holder agreed and confirmed that there wasn’t a single approach to how Council Museum assets would be managerd.

It is RECOMMENDED that Cabinet agrees and approves the progress of externalisation and submits the following recommendations:

The Council agrees:

(a)           that the future of the Russell-Cotes Art Gallery & Museum, for which it is sole trustee, would be best served by externalisation in the form of the transfer of Sole Trusteeship to a new corporate entity (CLG or CIO) to operate and manage the charity;

(b)           as Sole Trustee of the Russell-Cotes Art Gallery & Museum to make a formal application to the Charity Commission for a change of governance under Section 73 of Charities Act 2011 to replace the Council as sole trustee with a new corporate entity (CLG or CIO) acting as sole trustee and for the modernisation of governance articles;

(c)           to establish a Corporate Entity (CLG or CIO) and appoint a Shadow Board of 5 nominees to oversee the transition to independence, provide continuity and stability and to maintain an on-going supportive relationship with the new CLG/CIO;

(d)           to negotiate, during the transition phase, future years grant support for the new Trustee, along with the transfer of assets, lease arrangements etc with an expected vesting day of 1 April 2024 at the earliest; and

(e)           To delegate authority to the Director of Finance, Director of Law & Governance and the Chief Operations Officer to determine the best financial model in consultation with the Portfolio Holder.

Voting: Unanimous

Portfolio Holder: Tourism, Culture and Vibrant Places

Reason

To safeguard the Russell-Cotes Art Gallery and Museum in the longer term.

To modernise the governance arrangements for the charity and enable it to deliver its charitable objectives, fundraise effectively and thrive in the future.