Features: October 28th, 2011

The Government’s Comprehensive Spending Review has put pressure on local authorities to reduce subsidies for leisure whilst also maintaining high quality services and maximising income opportunities. But is capital available to transform leisure provision and if so, can it be done without adding costs to the service? Sarah Watts explains.

There’s a simple answer.
Yes, capital is readily available from numerous City funding institutions for robust development schemes, planned with extreme diligence. Most importantly, these projects must be supported by experienced and effective project delivery teams.

As a result of the Government’s spending review, local authorities need to make significant spending cuts over the next three years. Gaining internal council capital for the development of leisure facilities is becoming more challenging and so local authorities nationwide will need to explore their options, in order to attract City financial investment.

The public sector certainly has the desire and ambition to provide leisure facilities that their communities demand, but as a non-statutory service, leisure remains low priority for a number of councils.

Consider your options

To reduce subsidy and increase revenue through leisure provision, consider the following:

Option 1: Cut costs through restricted programming, staff redundancies and potentially, whole centre closures. No-one engaged in public services wants to see this.

Option 2 (certainly a more positive approach): Explore ways of increasing income. Naturally, careful use of resource will need to be a consideration but the focus should be on reducing subsidy and generating income opportunities through lateral vision and intelligent use of space.

There is little debate around the increasing difficulty to secure fiscal aid but through working in partnership with third parties, LAs will still be able to improve their local leisure provision during these financially challenging times.

Having the ‘know how’ – spend to save

Government backed organisations including LAs, educational organisations, Universities, trusts, and private management contractors (working in partnership with the public sector) that are keen to improve leisure facilities can access funding using Alliance Leisure’s contract structure which attracts investment from numerous City funding institutions.

In order to drive efficiency and sustainability, it is essential that, when looking to deliver a redevelopment or new build scheme, the LA and project management team:
• undertake a comprehensive evaluation of the existing provision,
• explore current revenue levels and opportunities,
• determine physical site constraints and opportunities,
• report on latent demand,
• analyse other private leisure facilities in the locality,
• develop concept and business plans for proposed developments (including full assessment of capital costs and profiled income projection),
• finalise (and fix) development cost, provide the capital funding and deliver the scheme.

LAs and project management teams are encouraged to engage with independent consultants to ensure a sustainable business plan.

Unique to our organisation, once the facilities are operational a partnering support service is offered to ensure all revenue opportunities are maximised. The approach is to make no charge for work; instead to take a percentage of increases in sales. Until agreed targets are achieved, the LA or leisure trust does not pay for the support service, removing all risk from the investment.

Flintshire’s a flying success

Aware of its ageing and costly facilities, the Council knew considerable redevelopment was required at Deeside Leisure Centre. Flintshire County Council was keen to create new and exciting commercial activities to attract a diverse range of local residents. But constrained by very tight budgets, how was Flintshire to progress?

“Without the support of Alliance Leisure the council would not have been able to access the funding needed to undertake anywhere near this level of leisure development,” confirms Cllr Dennis Hutchinson, Executive Member for Leisure and Public Protection of Flintshire County Council.

“In these difficult financial times, when all the talk is of public sector budget cuts, partnering with a private sector company means we can still look to make facility and service improvements for the benefit of the local population.”

Flintshire unveiled the first phase of its £10 million redevelopment project at the end of 2010; six, 5-a-side floodlit football pitches at Deeside Leisure Centre. North Wales’ flagship leisure centre now offers the local community state of the art 3G turf football pitches, catering for both adult and junior football.

A phased approach was chosen by the Council to ensure building works were in manageable packages both from a financial viewpoint but also to minimise disruption to the running of the leisure centre. Phase two, an 80-station health and fitness suite, two fitness studios, a toning salon and new changing rooms opened in August. The development of the first Welsh public sector day spa is well underway and opens its doors early 2012.

Hutchinson adds: “Gaining this financial support and expertise has allowed us to create a new sporting environment which is welcoming, inspiring and a pleasure to visit. Getting more people participating in sport and enjoying the benefits of regular physical activity will have far reaching social and health benefits for our local community. We recognise that the leisure needs of our community are diverse so we wanted to create a facility that accommodates a wide selection of needs and preferences.”

Phase three of the project is also underway with the creation of an indoor extreme sporting arena. In response to the local community’s leisure needs and sporting preferences, the location of the old ice rink will transform into:
• a climbing wall,
• a high ropes course,
• a skate park for boarding, inline skates and BMX bikes,
• a new café,
• an under 7s soft play zone
(all due for completion early 2012).

Creating revenue positive facilities

Partnership is the key to overcoming the financial pressures on LAs nationwide. Now is the time to evolve existing, underutilised leisure sites into thriving facilities that cater for the diverse leisure needs of local communities.

The redevelopment of Deeside Leisure Centre demonstrates the fantastic results that can be achieved through a City funded, robust business plan to revitalise an ageing and costly facility whilst not putting any additional burden on revenue or capital budgets.

Sarah Watts is Managing Director of Alliance Leisure. www.allianceleisure.co.uk