Urban Green Newcastle (UGN) lost nearly £700k before Newcastle City Council took back park control after six years.
UGN lost £699,192 after tax in 2023/24. This was their last full year. The council will take over on February 28. Councillors approved this change last month. Urban Green will shut down after the handover.
In 2019, the council gave 33 parks to the charity, along with over 60 allotments. The plan was “visionary” at the time. The charity was meant to become self-funded within ten years. Now, it’s ending after only six years.
The charity said its funding was “fatally flawed” and that they misjudged commercial income. They also did not foresee the estate’s poor state. UGN’s income fell £1.1 million in 2023/24, with grants and donations dropping by £900,000.
They spent nearly £300,000 of their savings, which reduced their cash to an insufficient level. Spending on parks decreased by £445,390. Jesmond Dene’s Pets Corner lost £59,397 in funding, while cafe spending dropped by £297,284.
Spending on governance increased tenfold, rising by £591,775. UGN said it reclassified costs, explaining that ICT, insurance, and admin became governance. These were previously parks spending, they explained.
The charity’s goal was self-funding in ten years, to offset reduced council funds. Several reasons prevented this from happening. Costs were underestimated as they did not foresee the dire conditions; commercial income grew slowly, they noted.
The pandemic started less than a year after launch. It shifted their focus away from income, and lockdowns impacted the parks plus staff. They added that costs had also increased.
UGN said they made progress toward sustainability and that the charity kept the council in the loop. Problems with the model first surfaced in 2021. The original funding model was fatally flawed; grants and income cannot fund the parks.
UGN used all £7.7 million from the council by March 2024. They received an extra £1 million for 2024/25. The charity then predicted a large deficit, amounting to £6.7 million by 2029.
The council’s deputy leader, Alex Hay, spoke and confirmed UGN shared information. He said that the staff will move to the council and the transfer should finish by March 1. Planning for the parks has already begun, he added.
Hay noted they would engage park users and hopes to meet stakeholders and volunteers. They know the positive impact of parks. They said our parks are vital to residents and it will be the focus of decisions.