Watchdog urges Paris to consider taking over management of Eiffel Tower

28 Jul 20

Problems with the publicly owned company managing the Eiffel Tower have led auditors to suggest the City of Paris could bring the monument back under direct control.

 

The existing management company, Société d’Exploitation de la tour Eiffel, was formed in 2005 and is 99% owned by the city government.

It turned over €100m in 2018, but faces a series of problems, including long waiting times and a 47% increase in admissions prices in late 2017 that was supposed to finance the creation of a reception centre, which has not yet materialised.

Instead, the price hike has been used to increase the workforce and the pay of workers and managers at the company, the Ile-de-France regional chamber of accounts said in a report into the company’s management and finances.

The benefits of using a publicly owned company for the city include a level of control over the company’s operations that would not be possible if the management was outsourced to the private sector.

But the auditors found SETE was not benefitting from the arrangement.

“The legal form of a local public company allows [the City of Paris] to delegate the management of the Eiffel Tower without a call for competition, provided it exercises over SETE a control similar to that which it exercises over its own services, but this is not the case in practice,” the chamber of auditors said.

“In fact, the status of SETE, which frees it from the legal and financial constraints of the public sector without exposing it to commercial constraints in the private sector, is not conducive to more rigorous management.”

Its status limits the monument’s ability to benefit from sponsorship, such as Notre-Dame or the Palace of Versailles do, despite the Eiffel Tower having “very little equivalence” in France for its global recognisability, the chamber said.

It added that the management is also failing to respect rules around the remuneration of the chairman of a publicly owned company, as well as running an illegal penalty system affecting cashiers.

The auditors suggested a private company, selected through a competition, would allow the monument to benefit from sponsorship, although the chamber stressed the city would need to “sufficiently defend its interests” when striking a deal.

They said direct management would have benefits in terms of transparency and public oversight of the budget.

It could have financial autonomy, and be subject to a special budget annexed to the city’s budget.

The auditors said the city could “draw inspiration” from its successful running of water services in Paris, since it bought out the two responsible private companies in 2008.

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