Tuesday, October 19, 2010

Share the risk...

It's not very often I agree with Jim Bagnall but I must say here that I have to agree with him somewhat, particularly as it relates to how Tourism Charlottetown got themselves bound into a 3 year contract without having some type of escape clause based on the first year's results... on who's responsible I doubt if it was then in coming Minister Vessey as most of the negotiating would have been done long before the event, when he wasn't the Minister... it was probably a group of people, vented by the Board... and had I been a Board member I probably would have entertained something new like "Cirque" as they are very successful in other markets, but I don't know if I could have been sold on a three year deal without some performance check points. I also don't know if an audit will produce anything new other than confirm the actual amount of the loss and that it didn't work, but it would certainly help to recommend how to avoid getting "trapped" into these types of situations in the future...

Bottom line is the "promotion business" is a lot like the "development business" and you have to take risks to be successful... an example of that is back during the Development Plan our government supported start-ups like Benner Ski and Paderno... at the time they both seemed a little farfetched for most Islanders, that we could manufacture skis and pots here... well Benner Ski failed miserably and the government lost some money but on the other hand Paderno has flourished into a solid business enterprise and that investment has easily recouped the Benner losses through jobs and taxes, that still bring returns to all Islanders... you're not always going to have winners but if you don't try new events like "Cirque" then you're never going to keep consumer's attention and maintain or grow your enterprise....

The bigger issue with Tourism Charlottetown is why they want to be a business enterprise taking all the risk... I'm more for situations like the Cavendish Beach Music Festival (a private operator) where government gives them some seed money and they take the risk and if things don't work out then they're on the hook, not the taxpayer... and if they make some money good for them as they'll probably spend it back in our community anyway... so if we're going to have agencies like Tourism Charlottetown, wanting to promote different ideas and venues to attract people here, then why can't they find promoters to share the risks as opposed to always trying to run it themselves... if they can't find anyone private to "run" with their ideas then it's usually a good indication that it's a poor idea in the first place... governments and their agencies should stick to sponsoring and promoting ideas and let others take the risks in delivering them...

Bagnall slams Tourism Department for Cirque failure
Published on October 19th, 2010
Opposition Tourism critic Jim Bagnall is questioning the role of the Department of Tourism in the current financial challenge facing Tourism Charlottetown.
Bagnall wants to know why the organization is looking for a $1-million bailout to cover the losses from this summer’s Cirque du Soleil performances.
“I want to know what role Tourism Minister Robert Vessey and his deputy, Melissa MacEachern, played in the contract process which has already guzzled $250,000 of taxpayers’ dollars, plus $450,000 from ACOA and is likely to cost us another $1 million,’’ Bagnall said Monday.
The Opposition tourism critic noted that during the spring session of the legislature, he raised concerns in the house about “unanticipated costs’’ related to the production contract.
“We warned government then that we were hearing major concerns about the contract, that it had not been properly scrutinized before being signed, but minister Vessey got into a big huff, refused to look into our concerns and criticized me for having the audacity to even raise the issue.’’
Bagnall charged ticket sales have nothing to do with the current financial crisis facing Tourism Charlottetown.
“I’m just not buying that,’’ he said, noting that Myrtle Jenkins-Smith, executive director of Tourism Charlottetown, said in June that ticket sales were going well and the phone was ringing off the hook.
“This is about this government handing over money to a corporation and not bothering to read the contract. They did the same thing when they poured close to $1 million to prop up the Alanis Morissette concert the year before.’’
Bagnall said Vessey’s refusal to look into the Opposition’s concerns was a costly mistake.
“Not only will we end up paying the $1 million to bail them out but who knows how much it is going to cost Tourism Charlottetown to get out of the $6-million, three-year contract it made with Cirque du Soleil.’’
Bagnall wants to know who was responsible for signing the three-year deal.
“Why sign a three-year deal on a show that hasn’t even proved to be successful? I don’t know who was calling the shots but I do know that Island taxpayers will be paying for their mistakes.’’
Bagnall said the Opposition will be tackling the issue in the upcoming session of the provincial legislature.
“We will want to see who’s signatures are on that contract. We will be questioning the lack of oversight on the contract process and we will be calling for the results of the independent review into Tourism Charlottetown.’’

No comments: