The Reel Update from OIC

The Reel was a well-established and valued business in Kirkwall, providing a popular café bar alongside a venue for teaching and performance of traditional Orkney music.

The Reel closed mid-March, we understand due to the coronavirus and the impact this had on The Reel business activities. The business decided not to re-open later in the year when other Orkney businesses were able to re-open to the public. In August 2020 the owners announced they would step down from running The Reel and sought a buyer for the business. A short time later the owners announced The Reel would close permanently from mid-November.

Orkney Islands Council very much recognises the important role The Reel has played in the cultural life of Orkney over many years and it is regrettable that the business has ceased trading.

The Council also acknowledges the importance of traditional music in the Orkney community and the wider folk music scene. We are one of only a handful of Councils who still do not charge pupils for music tuition in schools. Financial assistance is provided from the Strategic Reserve Fund annually to allow this to happen such is the importance and value placed on the teaching of music to our young people in the county.

This issue has attracted public interest over recent weeks and we thought it may be useful to provide you with some factual information on some of the main issues that have been raised.

Was financial support available to The Reel during the pandemic?

Yes, the business was able to access a number of funding streams and received financial support during the pandemic, totalling £38,500. These are broken down below into each grant.

The Council established the Coronavirus Response Fund of £5 million in May 2020. A number of schemes have been operated through this Fund, providing support to businesses struggling to manage the impacts of the pandemic.

Who owns the premises from which The Reel traded?

Orkney Islands Council own the building which was leased to The Reel, which had 14 years remaining on the lease. In the interests of fairness to all businesses and, following policy and procedure, the Council was unable to agree to a backdated rent holiday or a freeze on rent.

Why can’t OIC lease the building at a peppercorn rent?

The Reel was a commercial business and was therefore not eligible for any potentially advantageous lease arrangements that the Council may have been able to consider under different circumstances.

Why can’t OIC assist the owners further to ensure trading continues?

Due to various regulations, including those relating to state aid and business competition, great care is taken to ensure the Council’s funding policies are designed appropriately and comply with the law.

Grant assistance to businesses and organisations is provided under set policies and procedures, which have to strictly specify the kinds of projects that are eligible.

We have been able to provide a range of Covid-19 financial assistance through Government and Council business support schemes in recent months across the county, including to The Reel as highlighted above. The Reel was eligible for and received support from the Scottish Government and the Council in the same way that many other Orkney businesses were eligible. It would not have been appropriate or possible for the Council to operate outwith these schemes to respond to the specific circumstances experienced by The Reel as a commercial business.

In the interests of fairness to other commercial businesses in Orkney, we were unable to make a special exception to support the other requests put forward to us by The Reel.

Were Councillors involved in decision making?

Councillors approved the Coronavirus Business Support Grant from which The Reel was eligible and received direct support from the Council. Matters associated with the leasing of Council property are operational matters delegated to officers. Elected Members were kept informed of The Reel’s requests for assistance and were satisfied that these be managed through the Council’s normal operational procedures in accordance with the Council’s established policy.