House of Commons - Public Accounts

Select Committee on Public Accounts Eighth Report

2 The over optimistic visitor numbers and the marketing strategy

12. The original economic appraisal forecast 160,000 visitors per annum to the Centre within ten years of opening. However, the C&AG's Report tells us that the annual visitor numbers never exceeded 50,000 and averaged 33,000 over the eight years of the Centre's existence. As a result the Centre was in financial difficulties throughout most of its existence and received regular revenue deficits from public funds, the last of which ceased in March 2001.[20]

13. We note from the C&AG's Report that the actual paid admissions, not by schools but by others, were as low as 10% of even the pessimistic estimates.[21] We consider that this should have started alarm bells ringing to say that this Centre is not going to be viable.[22]

14. We noted the Department's view that Navan was a centre that visitors were unlikely to revisit.[23] When the concept was originally envisaged it included a 300 acre archaeological park which was to be of international status. The capital funding was provided because this was perceived to be a flagship project and would have attracted return visits. However, plans for the archaeological park were shelved and because the project as originally envisaged was not delivered the visitor figures proved to be overly optimistic and the number of return visits was low.

15. The Department has acknowledged that government was naïve with regard to projected visitor numbers and it also accepted, with the benefit of hindsight, that the original forecasts of visitor numbers provided by consultants were grossly misleading as the wrong comparators were used.[24]

16. We fail to understand why anybody thought that the Giant's Causeway and the Ulster American Folk Park made proper comparators. The Giant's Causeway is a geological formation which is world famous and which increased its visitor numbers from 120,000 to 300,000 over a period of eight years. The Ulster American Folk Park started from scratch and after nine years had not even doubled its numbers, going from 48,000 to 82,000. We were, therefore, most surprised that anyone should assume that a site which basically consists of a number of grassed earthworks would move from 30,000 visitors to 160,000 visitors in seven years.[25]

17. The Department told the Committee that the Navan Centre had exceeded its own target of 30,000 visitors in year one and that it was in year three that Navan itself approached Government and said that they had been ambitious in their aspirations. This led Navan to downgrade estimates of visitor numbers both at that stage in 1996 and also later in 1998.[26]

18. We welcome the Department's acceptance that the original estimates of visitor numbers were overly optimistic.[27] The Department has also acknowledged that there had been unease from the outset about the viability of the Centre and that the records show that officials at a number of stages expressed concern about ongoing viability.[28] We consider that there have been many incompetent decisions taken when it was clear that this project was never going to work.[29] We fail to understand why it was allowed to drag on for so long and that no one said enough is enough and pulled the plug.[30]

19. The Department told us that there were a series of circumstances including the effects of political unrest particularly those associated with Drumcree, the restrictions caused by the foot and mouth outbreak and a fire at the Centre all of which had an impact on visitor numbers.[31] However, we agree with the C&AG's Report that in addition to these factors the evidence would suggest that the basis of the forecast numbers was unsound from the outset.[32]

20. We asked the Department whether they were confident that this situation would not happen again with another Centre and how they could be sure that realistic projections of visitor numbers are provided by consultants rather than ones which tell them what they want to hear. The Department told the Committee that there are now procedures in place, such as Gateway, that ring warning bells at an early stage.[33] We welcome the adoption of this approach and trust that lessons learned from the Department's experience with the Navan Centre will be fully applied in existing and future projects in all Departments.

21. The C&AG's Report tells us that when consultants were brought in they were surprised that the 1995 marketing strategy had not been updated in the two and a half years since the marketing manager had been made redundant.[34] The Department agreed with the Committee that the marketing strategy should have been revisited. The Department also accepted that because of the cost savings which the Navan Board made, including making the marketing manager redundant, there had not been a properly targeted marketing effort and this had led to a downturn in visitor numbers.[35]

22. We are disturbed as to why, if officials were consistently concerned about the commercial viability of Navan, there was not more of an effort made to develop a marketing strategy. The Department told the Committee that it was because of these concerns that they commissioned a consultant in 1997 to look at marketing.[36] We consider, however, that more could have been done to market the Centre and that momentum was lost in raising the profile of Navan in the early years of its operation.

23. One area of the Centre's activities where there was significant success was the education programme which we were told was of a high calibre. We consider that this example demonstrates that, with well targeted marketing, they may have been able to increase visitor figures.[37]

24. We noted that one consultant found that "awareness of Navan is low even with prompting" and "the incidence of visiting is low and the likelihood of paying further visits is also weak". There appears to have been the assumption that this Centre could be built up into a big international venue. This seems to us to have been massively optimistic at the time. We consider that all the precedents for such a Centre should have led the Department to look at the Navan Centre with a jaundiced eye.[38]

20 C&AG's Report, para 1.5 Back

21 ibid, Appendix 2 Back

22 Q 73 Back

23 Q 129 Back

24 Qq 7, 22-26 Back

25 Qq 81-83 Back

26 Qq 25-27 Back

27 Q 133 Back

28 Q 103 Back

29 Q 107 Back

30 Q 112 Back

31 Q 79 Back