The Garden opened in May 2000, and despite good attendance in the first two years, it ran into problems because of higher than expected operational costs, which was subsequently exacerbated by a fall in visitor numbers. A Science Centre, costing £3 million, still remains empty. Little research has taken place in it and no entrepreneurs are based there, although there is now progress being made in relation to the use of the building.

The Welsh Assembly Government, the WDA and the Wales Tourist Board all gave funds to the Garden project and are accountable for their use of public money to the National Assembly for Wales. While all three bodies carried out risk assessments and appraisals of the Garden’s business plans before awarding cash, the report says in some cases they could have done more to monitor and address the risks.

For example, on just one occasion did any of the Welsh funders carry out their own sensitivity analysis to assess the impact of variations to the Garden’s operational forecasts, such as to the numbers of visitors, expected income and expenditure.

Also, the report found that some public sector backers focused their attentions on their own, relatively small contributions and were not fully aware of the financial problems affecting the overall Garden project until nearly two years after it opened.

Since 2002, the Garden has received additional financial support, including over £1.5 million from the Welsh Assembly Government, to assist with operational costs. A recovery strategy developed by the Garden and supported by the Welsh Assembly Government, Millennium Commission and Carmarthenshire County Council is helping to improve the Garden’s trading position. For example, it exceeded its 2004-05 targets for total visitor numbers.

The report makes a number of recommendations. They include calls for Welsh public bodies to:

• assess the possible impact of any variations to business plans
• require applicants to include details of contingency plans in case operational forecasts are not met;
• share information and collaborate more when providing funding to the same project and;
• work with the Garden to resolve the ongoing issues of the Science Centre.

The Auditor General for Wales, Jeremy Colman said today:

“Public bodies should be more alert to the risks involved when funding an ambitious and risky project like this one, particularly if there are changes in its own plans. When multiple public bodies are funding a project they need to take a collective view of the risks and benefits that may arise.”

Notes to Editors:

• This report examines the decisions made by the Welsh Assembly Government, WDA and Wales Tourist Board to finance the project, including decisions by the Welsh Office in relation to ERDF funding. It considers whether the decisions were soundly based and how well the risks were managed.
• The report does not examine the Garden itself, which is not subject to audit by the Auditor General for Wales. It also does not examine funds provided by the Millennium Commission or Carmarthenshire County Council.
• The National Botanic Garden of Wales is one of the largest Millennium projects in Wales. It is situated on the 568 acre site of Middleton Hall at Llanarthne in Carmarthenshire
• It is an independently owned company, and a registered charity, which sought funding from a wide range of public and private sector organisations.
• About half of the £43.6 million capital funding to the Garden was provided by the Millennium Commission from lottery funds. The remainder came from a range of private and public sector sources, including the European Regional Development Fund, the WDA and the Wales Tourist Board.
• The Wales Audit Office (WAO) is independent of government and is responsible for the annual audit of some £19 billion of annual public expenditure.
• The WAO was created on 1st April 2005 in consequence of the Public Audit (Wales) Act, 2004, which expanded the functions of the Auditor General for Wales and enabled the transfer of staffs from the Audit Commission in Wales and National Audit Office in Wales to his employment.

For more information please contact Rachel Harries (Communications and Media Officer) on 02920 262 675 or email rachel.harries@wao.gov.uk