Agenda item

[Report of the Director of Environment and Neighbourhoods.  To be introduced by the Cabinet Member for Climate Change, Equalities and Leisure]

The report will set out the options available to the council for the future management of New River Sports Ground following the transfer of the lease back to the council.

The Cabinet Member for Climate Change, Equalities and Leisure introduced the report which sought approval for the ‘run directly’ option to establish an in-house leisure management operation to manage New River Sport and Fitness.  The report also sought approval to vire £0.305m from the General Fund capital programme contingency to fund the capital costs.

Simon Farrow, Highways, Parking, Parks & Open Space Manager, responded to questions from Councillor Emery:

-                 Mr Farrow had previous experience of working as part of the team running New River.  A close relationship had been maintained with Fusion over the years so the inhouse team had a good understanding of how it worked. 

-                 Work had been carried out with consultants to put together the strategy and on balance it was considered to be a good business case.

RESOLVED to

1.         Approve the ‘Run Directly’ option outlined in paragraphs 6.15 to 6.46 of the report and establish an in-house leisure management operation to manage New River Sport and Fitness.

2.        Delegate authority to the Assistant Director Direct Services to set the actual date of transfer, in consultation with the Cabinet Member for Climate Change, Equalities and Leisure.

3.         Agree to vire £0.305m from the approved general fund capital programme contingency to fund the capital costs set out in paragraph 6.38 of the report.

Reasons for decision

Run Directly is the option that can best deliver the Council’s objectives of implementing the new management arrangement within the 12 months of the short-term lease.  This option will allow the Council direct control and ensure that the management and activity programme is closely aligned to the Borough Plan Outcomes.

The business plan projects that the Council should, under stable operating conditions, be able to operate New River on a break-even basis. Allowing for mobilisation costs and essential capital upgrades, the cost of this option is less than the reintegration option.

This option allows the Council to review its actual performance in 2-3 years’ time and consider in a post-pandemic period if this remains the best option for the Council.

Alternative options considered

The Council set out to assess six options in line with its agreed insourcing policy. The following four options were ruled out as part of that assessment on the basis that they did not meet the high importance criteria set by the Council (see table at para 6.4): 

1.         Sale of the site

2.         Leasing the site on similar terms

3.         Tender to a new provider

4.         Run via a local authority trading company

The options of Run Directly and reintegration with the existing leisure management contract are set out within this report.

The option to reintegrate New River within the existing leisure management contract is not being recommended for several reasons.

Firstly, the proposal from Fusion would require the Council to subsidise the cost of running New River by £399k over the next three years. This is more than the cost of the Council mobilising its own operation and making the business plan critical improvements identified in this report.

Secondly, running New River via Fusion would not afford the Council the direct control that it seeks to shape the operation and deliver both the commercial and social outcomes the Council believes are achievable.

Thirdly, reintegrating New River in to the leisure management contract would also place all the Council’s “eggs in one basket” in a period of considerable uncertainty for the leisure providers.