On Friday 10th November, the doors of Burngreave Community Action Trust (BCAT) were closed for ever. Staff were given their P45s and told not to come in on Monday. The Trustees told members that they had decided to put the company into voluntary liquidation because it “cannot by reason of its liabilities continue its business”.
It is understood that BCAT owed New Deal a sum of around £80,000, which it was unable to pay back. A meeting of members and creditors will be held on 6th December.
Pulling the trigger
The decision to close was triggered by a letter from New Deal, dated 25th October 2006, giving BCAT two weeks to repay the £80,000, paid in 2005 when BCAT was managing the BNDfC Small Grants Fund. John Clark, Chief Executive of New Deal, said the letter was sent when, as funders, they became convinced that BCAT’s inability to repay the money was because they had spent it on other things, rather than because of cashflow problems, as understood by BCAT trustees.
BCAT has received £800,000 from New Deal over the last four years to develop the capacity of other organisations and develop the BCAT organisation itself. There had originally been talk of BCAT managing New Deal’s assets after the end of the ten-year programme in 2011, leaving questions as to who will manage the assets now.