Councillors will be asked next week to approve a £170,000 bail-out for the new Perth Museum.
The £27 million attraction in the former Perth City Hall has been open for less than a year.
But it is already being blamed for a looming cash crisis at Culture Perth and Kinross.
The charity, which runs the museum, libraries and other cultural services for Perth and Kinross Council, is losing “significantly more” money than bosses had budgeted for.
And if it continues at this rate it will go into the red within the next two months.
The funding crisis is outlined in a report to Wednesday’s meeting of the finance and resources committee.
It explains that the council’s two other “arm’s length external organisations” – Live Active Leisure and Perth Theatre and Concert Hall – are also forecasting losses. But both are in line with their approved budgets.
However, Culture Perth and Kinross is projecting a deficit that is “significantly more than the level originally budgeted”.
The report to councillors says: “They have experienced additional costs relating to the current year pay award, to historic equal pay claims and to the running costs of their establishments, particularly Perth Museum.
“Should these projections come to bear, Culture Perth and Kinross will have negative unrestricted reserves as at 31 March 2025.”
Council has already set aside £230k in case Perth Museum needs it
The finance committee already approved an award of £60,000 to Culture Perth and Kinross to pay for fixtures and fittings for the museum cafe in February 2024.
It came after the charity stepped in to run the venue itself following two failed bids to find a private operator.
Another £170,000 was to be made available to meet the upfront costs of operating the cafe until September 30 this year.
That portion has not been needed until now.
But if councillors agree to the recommendation at Wednesday’s meeting, the council’s Chief Finance Officer will be given the authority to pay it out.
“Any payment will only be made if absolutely required in order to ensure the financial position of Culture Perth and Kinross at 31 March 2025,” the report says.
Museum cafe was always controversial
Culture chiefs say the new Perth Museum has already attracted more than 200,000 visitors, surpassing all targets for its first year.
However, concerns over the cafe have lingered.
Before it opened last March, critics warned it would draw trade away from existing eating places beside the museum.
And in November, Culture Perth and Kinross chief executive Helen Smout admitted it was still running at a loss.
Speaking at the time, she said: “We are still working towards getting to the break even point with the cafe, which we hope to do by the end of the year.”
Culture charity’s finances in spotlight
Culture Perth and Kinross is also under intense scrutiny at the moment due to its review of libraries.
Residents in Alyth, Auchterarder, Birnam, Comrie and Scone are fighting to keep their local branches open.
Library users have staged protests against the proposed cuts in their own towns and outside Perth Museum.
And campaigners delivered a 5,600-name petition to the council last week.
The council is reviewing the future of its three arm’s length organisations.
It will consider new ways of providing their services later this year.
Conversation