Newcastle parks cafes were 'haemorrhaging money and needed shutting down'
Two Newcastle park cafes were “haemorrhaging” money and had to be shut down, council bosses have insisted.
City officials have defended the controversial move to close the cafes in both Exhibition Park and Paddy Freeman’s park.
The double closure has sparked a backlash and bosses have since announced plans to try to reopen the sites under a private operator, despite having branded them commercially unviable.
Newcastle City Council director Christine Herriot told councillors this week that the decision was about “stopping the haemorrhaging of money” – with the Exhibition Park cafe expected to generate a cost to the public purse of £177,300 for 2025/26 and Paddy Freeman’s cafe £19,700.
As a whole, the council’s parks service is projected to spend around £2.4 million this year – significantly above the £1.5 million annual budget allocated when the local authority took back control over 33 city parks from charity Urban Green Newcastle (UGN) in March 2025.
A council report said that it faced significant increased costs at the cafes that affected their viability, including paying staff the Real Living Wage, and that the sites had endured “significant challenges stemming from inconsistent management” during the final years of Urban Green’s tenure.
At a meeting of the council’s corporate scrutiny committee on Tuesday, Liberal Democrat councillor Mark Mitchell accused UGN of “financial incompetence” and not passing on accurate information about its budget position.
The council took back the parks service from the charity due to concerns that it would not be able to survive without significant ongoing financial support from the local authority.
Coun Mitchell also suggested that the smaller deficit at Paddy Freeman’s indicated that the council “could have taken a bit more time” and tried to transition to a new provider without the need for a sudden closure of its cafe.
He added: “The fact is that we were unable to run a process here that would mean an orderly transfer to a third party provider. I am not complaining about the decision made, but that fact is that that is what the city has seen.”
UGN’s most recent accounts, for the year ending March 31 2024, showed an overall loss of more than £700,000. However, its cafe operations in that year actually ran at a £120,000 profit.
Christine Herriot, the council’s director of city operations, neighbourhoods and regulatory services, said that the two cafes were “very much appreciated by the community” but had too little footfall to justify their continued operation.
She added: “The demand just was not there, we are more than able to demonstrate that.”
However, the committee was told that expressions of interest from third parties in taking over the cafes were coming in daily and that officials were optimistic of quick progress in leasing them out.
Of the 13 staff who worked across the cafes, two have secured alternative employment in the council and another one has found a new job elsewhere.
Labour councillor Clare Penny-Evans said she did not want to see the buildings follow the path of the old Fisherman’s Lodge in Jesmond Dene, which has gone to “wrack and ruin” after its closure – having suffered from vandalism and a devastating fire.
The Heaton councillor added that local residents would not be bothered who runs the cafes, only that they would have somewhere to buy a coffee and use the toilet.
Coun Marion Williams, of the East End and Associates Independent group, added: “It is what happens in business, when you realise you are unsustainable, you have to stop. People in my ward would not want to be subsidising cafes on the other side of the city to them.
“I am sure others would not want to either. There are difficult decisions to be made when you are bringing a failed experiment back into the council and I fully appreciate the extra load you [council staff] are under.”