I have been approached by a number of constituents who have raised their concerns regarding the re-opening of Places Leisure centres across Mid Sussex. I share this concerns greatly too. Unlike private gyms, Places Leisure have a partnership arrangement with Mid Sussex District Council (MSDC) to provide facilities for the community. This is part funded by income generated by Places Leisure from the use of the facilities and part funded by MSDC. This is a standard working model and most councils will have very similar contracts with organisations such as Places Leisure to provide this type of facility for community use.
Following the recent Government announcement that leisure centres will be able reopen from the 25th July all providers of facilities have been working hard to prepare not only their premises but also ensure that they are financially viable to do so with a reduced capacity, as is currently required in line with the Covid 19 guidelines.
Unfortunately at this time Places Leisure centres in Mid Sussex, whilst able to operate safely, are affected by the severe financial impact of Covid-19. This is a common situation for all council/leisure centre provider partnerships across the UK and is not an exclusive situation to Mid Sussex.
Social distancing will artificially reduce the number of constituents who will be able to use the leisure centres. This reduces the income however without accompanying reductions in cost and therefore creates a financial deficit that Places Leisure can only sustain with significant subsidy. MSDC rightly confirm that they need to carefully consider how taxpayers’ money is used given the very substantial sums that will now be involved which could amount to hundreds of thousands of pounds of taxpayer subsidy every month for what is now an undefined period.
I am aware that MSDC are in significant negotiations with Places Leisure, however this is not a simple task and they advise they are yet to reach a sustainable agreement. I agree that it is essential that the Council assess what can actually be afforded and what level of taxpayer subsidy can be justified given the low participation rates which are inevitable from social distancing. Once an in principle agreement is reached, and because this deviates from the existing agreement and is expected to have a significant financial impact, any changes must be ratified formally by the MSDC Cabinet. Once an agreement is confirmed, Places Leisure will then need an appropriate time to prepare centres for reopening.
I am assured that MSDC are working very actively to reach such an agreement to find a way forward which will allow at least a partial reopening of leisure centres. At this time, I have been advised that this means that there is currently no realistic prospect of leisure centres reopening in August. This is hugely disappointing and I met with the Leader of MSDC, Cllr Jonathan Ash-Edwards who is working non-stop with the local team on behalf residents to push for progress and I have offered all the support I can give. I have been actively engaging with the Sports Minister on this who is working with MHCLG to find broader solutions to help local authorities. As others are in greatly similar situations. As a former Sports Minister, who is dedicated to inclusive activity opportunities, I am determined to push for all support to unpick this challenging situation here in Mid Sussex and wider.
UPDATE: Wednesday 12th August
I have received the following update from Cllr Jonathan Ash-Edwards, as the Leader of Mid Sussex District Council. He writes:
"I am really pleased to be able to share a positive update about the reopening of leisure centres in Mid Sussex.
After weeks of tough negotiations, the Council has now been able to reach an agreement with Places Leisure about the financial support package which will be needed so the centres can reopen. There will be a special Council meeting on 19th August where Councillors will be asked to approve the deal we have reached. If they do, the Dolphin, Kings and Triangle leisure centres will be able to reopen in the first week of September.
I know that will be really welcome news for residents who are keen to return to the gym, swimming pools and classes after the Covid-19 lockdown.
This issue has been incredibly challenging for Councils across the country and is certainly not unique to Mid Sussex. The ‘change in law’ clause in most leisure management contracts triggered by the Coronavirus Act means Councils have to negotiate a financial support package to ensure leisure providers can continue to operate the centres and be left no worse or better off than before. At the moment, it is not certain when this legal obligation will cease.
Social distancing will artificially reduce the capacity of leisure centres, and therefore their income, and the high, fixed costs of leisure centres mean they will run at a deficit. This will require significant taxpayer subsidy of hundreds of thousands of pounds a month.
The agreement we have reached with Places Leisure is a flexible one, and the level of taxpayer support will reflect, on an open book basis, the reality of revenue once the centres reopen. If revenue is higher than we currently estimate, the level of taxpayer subsidy will fall and vice versa. We will continue to very carefully manage the risk to the taxpayer and will be undertaking a formal review of the situation every three months."
This webpage will be updated as more detail becomes available.