considered a report on the contract with Freedom Leisure. The
Corporate Director – Operations, Homes and Communities
explained that Freedom Leisure had asked the Council to consider
providing further financial support to cover the increased cost of
running the Council’s three leisure centres due to economic
In summary, the latest
forecasted position (not including additional energy costs) showed
that in a best-case scenario the Council would receive a management
fee of £536,284, with the worst-case scenario leading to a
management fee being received of £264,321.
Meanwhile, Freedom Leisure’s current gas
and electricity tariffs were both due to expire shortly, and they
had informed the Council that projected tariff increases were
likely to give rise to additional costs of £252,036 in the
current financial year and potentially an annual increase of around
£520,000 from April 2023.
that rising inflation and energy costs were significant and had not
been built into the bid submission when the contract was let.
Without some form of intervention from the Council, the operation
of leisure services as currently delivered could therefore be
placed at risk.
It was therefore
proposed to offer direct financial support up to a maximum value of
£255,000, to cover the period 1 October 2022 – 31 March
2023. It was recommended that this is taken from the
Council’s Business Rates Risk Reserve. For future years, it
was proposed to undertake a detailed review of leisure services
provision to determine the options for addressing the long-term
impact of increasing energy costs.
Furthermore, in June
2022, Freedom Leisure expressed their intention to submit an
in-year proposal in respect of their fees and charges. The impact
that this would have on customers was discussed and it was agreed
to pursue a fees and charges review in line with the normal budget
timetable, with reports coming to Communities Committee, Income
Generation Sub-Committee and Council as part of the budget setting
for 2023/24, rather than request a specific fee increase outside of
the budget cycle.
Rob Tyler, Freedom
Leisure Contracts Manager, and Jeremy Rowe, Freedom Leisure
Operations Director, were invited to speak and they responded to
questions from Members. They explained the measures which Freedom
Leisure have taken to address options for energy efficiency
measures. Rob Tyler explained that this includes reducing pool
temperatures, staff environmental training, a cover on the pool at
Perdiswell, upgrading to LED lights, establishing energy action
plans and the appointment of a group environmental and
sustainability manager. An independent report on solar
opportunities has been commissioned. Jeremy Rowe commented on the
advice from Freedom Leisure’s energy broker to steer
decisions on future energy supply.
In the ensuing
discussion, Members acknowledged the information provided by
Freedom Leisure, which had been helpful in understanding the
current pressures and the energy saving measures they had put in
place since 2018. Members discussed the alternative options
considered, as set out in the report, but concluded that these
should be discounted at the current time due to the significant
rise in energy ...
view the full minutes text for item 44.