Highlands and Islands MSP, Edward Mountain, questioned Audit Scotland on their investigation into Cairngorm Mountain and the Funicular Railway during an evidence session of the Scottish Parliament’s Public Audit and Post-Legislative Scrutiny (PAPLS) Committee.
Edward Mountain asked: “There are obligations between the landlord’s agent, which is HIE, and the tenant. Are you satisfied that £10m worth of repairs to the funicular railway happened in the last year of Cairngorm Mountain Ltd.’s operation of that or do you feel that the landlord’s agents failed to inspect the asset in the five years of operation?”
Gordon Smail, Auditor Director, replied: “We need to explore further the nature of that relationship and what the expectations were in the agreement between HIE and CML in relation to the funicular.”
The MSP then asked: “Will you also be looking at the payments made by CML to Natural Assets for being a sub-tenant, because it appears to me that money was being taken out of the asset but no repairs were being carried out.”
The Auditor General of Scotland confirmed they would investigate this issue and that their report would address “the whole relationship between HIE and NAIL, the owner of CML; the extent to which that was based on due diligence in the first place and then properly monitored during the life of the agreement until CML went into administration last Autumn.”
Following the evidence session, Edward Mountain MSP commented:
“It is clear that serious questions still need to be answered by the Scottish Government, HIE and the previous operators of Cairngorm Mountain as to how the resort fell into such difficult times.
There are four key questions that we must have answers to.
- Firstly, £10m worth repairs are needed to fix the funicular but did those list of repairs build up in the last year of operation or in the last five years?
- Secondly, how much money was being transferred between Cairngorm Mountain Ltd and Natural Assets Investment Limited?
- Thirdly, what due diligence was carried out on the change of ownership of Cairngorm Mountain Limited?
- Finally, if there is proof of financial mismanagement, will those responsible be held accountable?
No stone can be left unturned as Audit Scotland investigates this issue and I look forward to the completion of their investigation.”
In March 2019, Edward Mountain MSP wrote a letter to the PAPLS Committee requesting an investigation into the use of public money at the Cairngorm Mountain resort.
Since then Audit Scotland, which reports to the PAPLS Committee, has completed its 2018/19 audit of Highlands and Islands Enterprise and has opened a further investigation into the running of Cairngorm Mountain and the Funicular Railway.
Edward Mountain#s questions to the Auditor General regarding the Funicular Railway can be viewed from 11hrs 04mins 15secs in this video: https://www.scottishparliament.tv/meeting/public-audit-and-post-legislative-scrutiny-committee-september-19-2019
