GLL Belfast Leisure Centre Takeover

So Belfast City Council’s “outsourcing” (I love the Orwellian newspeak of this phrase) of its leisure facilities has been in the pipeline for quite a while, but the official hand over of our leisure centres to Greenwich Leisure Ltd (a ..err… “charitable social enterprise for all the community”) happens on 1st January. BBC today is running a story on sixty staff losing their jobs* and from what our local leisure staff have been telling me over the last few months, prices are also set to spike, notwithstanding GLL’s commitment to “delivering five-star services at three-star prices”.

To be fair, local Leisure Centre prices were not exactly on the cheap side. Fine if you qualified for the half price Boost membership, but pricy enough otherwise and no family passes on offer. However, having a swimming pool, gym, sauna, exercise classes etc. that you could pay per use whenever you felt like going, ten minutes walk from the house was pretty decent.

When you actually read the BBC story, though, it’s not so much that 60 people have been let go – which would be bad enough – but that it’s all but 60 of the existing leisure centre staff have taken voluntary redundancy after union negotiations. And it’s not a great climate to be out looking for a job.  [See footnote for reason for amendment]

Belfast leisure centres have, in addition to sport and leisure facilities, been providing community services such as swimming lessons for kids with Autism, holiday schemes and tailored fitness sessions for people with health conditions.

Prices are set to be reviewed over the next nine months and the move will allegedly save Belfast City Council £2m a year…but meanwhile the Council is taking out a £105m loan (from where? on whose authorisation?) to refurbish the leisure centres it will no longer be running. If I’m not mistaken, something similar has happened at Belfast’s Waterfront Hall. Back in 2012, Slugger’s very own Alan in Belfast reported that Belfast City Council was planning to do this, i.e. spend £20m (in conjunction with NITB / European Regional Development Fund) on an extension to the Waterfront Hall, getting rid of the studio space that was being used by community theatre groups. Plans subsequently changed. Now the extension is going ahead next year, but at a cost of £30m rather than £20m. The studio space is staying. Discussions are ongoing as to who will operate / profit from the newly expanded / refurbished Waterfront Hall. As recently as November 2014, Belfast City Council minutes were published, suggesting various options for who should operate the Waterfront once renovations are complete. These options include:

“Belfast City Council will fully test a range of operating options for the project to ensure the operating model deployed gives the greatest return to the economy in line with the targets outlined within the approved business case. These options are to include (but not limited to):

i) The review and potential enhancement of the current status quo operating model

ii) Outsourcing the operation to an established private sector operator

iii) The creation of an arms length company/non profit distributing organisation wholly owned by Belfast City Council (NDPO/Mutual Company)”

So, the eventual business model for the Waterfront appears to still be undecided. What is confirmed is £30m is being pumped into it from public money and there is no guarantee that the public stand to benefit much from an arrangement in what a private sector operator takes it over once the refurb / extension is complete.

Which sounds a little like £105m being spent on Leisure Centres which are now run by GLL, funded by a loan that Belfast City Council is taking out.

Strange?

It will be interesting / potentially disheartening / predictable to see how it all plays out.It will be interesting / potentially disheartening / predictable to see how it all plays out.

Editors note: The BBC have amended their original report to point out that the 60 employees received voluntary redundancy and that 250 leisure centre staff will be retained by GLL when they take over next month.

 

 

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  • barnshee

    “meanwhile the Council is taking out a £105m loan (from where? on whose authorisation?) to refurbish the leisure centres it will no longer be running. If I’m not mistaken, something similar has happened at Belfast’s Waterfront Hall, which has been refurbished with public money only to be handed over to a private company to run – but I’m not sure on the details of that, so if someone wants to comment below and clarify this I’d be much obliged.”

    If these details are correct it looks like a misapplication of public money, needs detailed scrutiny -FOI`s and a whistl blower might help. .

  • S B
  • I don’t know if it will turn out to be an actual misapplication of public money – these things usually stay *just* on the right side of the letter of the law, if not the spirit of the law. But if anyone has any more details on the GLL deal, or what is going on / went on at the Waterfront, or any details on other public assets – eg social housing etc…post em up!

  • Glenda Davies

    It’s really all about selling off the family silver – watch out its the NI Housing Executive next – first stage ‘pilot’ 2000 public home to be transferred to housing associations leading to rent increases & diminished services. Restructuring of NIHE offices & budget will leave them ripe for sell off!! Speak to Hands Off Our Homes for further info

  • chrisjones2

    Will the new operators be able to overcome the insurmountable logistic problems of getting gin tonic ice and lemon to the bar at the same time In 20 years the city council couldnt

  • chrisjones2

    The silver is tarnished.We are broke.

    Every tick should be overprinted with “SF WELFARE TAX” and the amount

  • The investigation continues…

  • Comrade Stalin

    The question that you’re not asking is – should ratepayers be subsidizing fitness services that are available from the private sector, for a small number of users ?

  • Comrade Stalin

    Reading between the lines, most of the savings are probably coming from staff rationalization, and shifting staff off the generous Council pension scheme.

    I doubt that there will be much change in the service offered, as it sounds like the service is still under the council’s control. The Evil Capitalists ™ don’t seem to be making much money out of it either given that this entity is a nonprofit.

    I use the Newtownabbey gym at the Valley (er .. sometimes).. It’s a good gym, but there are some obvious differences with the private sector gyms I’ve used. On the positive side the council repairs broken equipment more quickly. On the other hand, there are way more staff milling around than you would otherwise see.

  • I was just off trying to persuade Belfast Barman(ager) to enter the ring with this argument! I obviously think yes but here is a good place for a bit of debate…

    However, I think the main query I have, aside from selling off our amenities, is why are BCC taking out a £105m loan, who are they getting the loan from, what is the interest rate on that, who authorised it and why are GLL going to get to profit from that rather than the money going back into BCC coffers…?

  • I’d we’ll have to wait to see what will be in the ‘price review’ which is coming up in 2015. Given how big of a loan BCC is taking out to do the renovations, I imagine they will be in accord with GLL in hiking the prices upwards.

    Personally I’d rather have more basic facilities that I can afford to use and that are local to me. But, hey…when you can have all this http://www.belfastcity.gov.uk/leisure/transformingleisure/andersonstownregeneration.aspx who is counting the £19m cost? Not to mention all the staff who have been let go.

  • Comrade Stalin

    Are they actually selling anything off, or are they merely paying this crowd to run the leisure centres ?

    You wouldn’t spend £105m on something you were about to flog. It’s more likely that the investment is part of the deal between BCC and GLL. I’d imagine that in return GLL are expected to return a revenue stream to the council.

    The questions about the loan are good ones. I see no reason why the council’s press office would not be able to answer them.

  • salmonofdata

    It’s a bit of a weird one, this.

    The £105m scheme was approved on 21 June 2013 (the minutes are at http://tinyurl.com/lqlwhju). The council have estimated that they will have an annual financing cost of £8.93m; financed partly through efficiency savings, hence the handover to GLL. The minutes note that cost recovery is 35% in Belfast, versus a sectoral average of 65%, so it is fair to surmise that price increases are on the cards to bridge that gap.

    Where the funds are being borrowed from is somewhat opaque, but as far as I can see there are two sources of borrowing open to local authorities in NI, the Reinvestment and Reform Initiative (RRI) and the European Investment Bank. Given that EIB borrowing is still at the drawing board stage, that means the borrowing is probably from the RRI.

    If so, that’s weird. The RRI is essentially UK Government borrowing, and as such is cheap because the UK Government can borrow at (historically) cheap rates. The NI Executive currently has £1.7bn of lending under the RRI, and currently pays £63.4m of annual interest, so it effectively is borrowing at 3.7%. This makes sense, the current 30 year yield on UK government borrowing at the start of 2014 was 3.5%, and RRI borrowing is over a 25 year term.

    Which makes it curiouser and curiouser why Belfast City Council is paying so much in interest on the £105m. Its funding charge of £8.93m on the £105m gives it an effective interest rate of 8.5%, over double what the NI Executive is paying. Why is Belfast City Council paying so much to borrow money?

  • On twitter earlier on @AdamTurks replied to me “it’s stated policy tho to invest and then sell. In the case of W’front it stinks for so many reasons”. This was news to me, and like you, I thought well why would anyone invest that type of money in something they were planning to sell on? I am doing some poking around online in Belfast City Council minutes but I haven’t found anything relating to the policy Adam mentions. Maybe someone on here knows more about this?

  • This really is going down the rabbit hole. I feel a Freedom of Information request coming on….

    Also weird – at least with the Waterfront they have decided to pursue this extension plan and they have sorted out the financing for that well in advance, and exactly what the plans are before they actually do anything, and BCC haven’t definitively stated they are going to hand it over to a private operator when the renovations are completed in 2016.

    With the Leisure Centres, they have allocated a fairly arbitrary amount to each project and then they have basically asked people to suggest stuff, no plans are finalised, no renovation work has begun, but the whole operation has already been handed over to GLL.

    Why?

  • salmonofdata

    The only schemes specifically mentioned were the renovations of Andersonstown and the Olympia, for which £38m has been earmarked. This is a hefty amount, when considered that the total bill for building a leisure centre from scratch in recent years, in London, has been in the £10m-£20m range. It seems surprising that it costs more to renovate a leisure centre in Belfast than to build one in London.

  • Comrade Stalin

    Agreed, it sounds like a huge amount of money – unless they are indeed proposing demolition and rebuild.

  • chrisjones2

    Haven’t Senior SF members already bought up hundreds of them?

  • chrisjones2

    or using certain well connected Companies

  • chrisjones2

    …because GLL will be more efficient that Council Managers and Councillors wont be bale to make representations on behalf of wee Jenny who has an appallin bad back and that is why she has bin on the sick for 6 months

  • chrisjones2

    …or stop the existing haemorrhage

  • I don’t know much about the specifics but certainly what I have seen of the Andytown plans, it seems like a complete rebuild and a redevelopment of the whole area around the Centre, with a huge outdoor area and pitch to the rear. So for a near demolition, rebuild, a new sports pitch and landscaping a big outdoor / garden area maybe £19m is reasonable. I really don’t know though. And I’m not sure of the wisdom of such an extensive redevelopment that the facilities are going to be out of use for a long time and BCC has to borrow so much money to do it when people don’t really seem to be demanding it, or not demanding so MUCH of it..

  • Brian O’Neill

    Salmon can you email me at brian@sluggerotoole.com thanks.

  • Comrade Stalin

    oh, I know what the wisdom of it is. It’s the senior folks at the council getting a big project to their names to advance their careers.

    A lot of it goes on. IIRC it was the BBC who uncovered a while back that prior to implementation of the new councils, a lot of the old councils had commissioned big new HQ buildings. The chief executive (and friends) at the council come up with these big schemes and, no doubt with the help of lots of Powerpoint presentations and other impressive inducements persuade the council to vote it through.

  • I don’t think that it’s really a fair representation of the ways in which BCC run all their services to reduce it to “making representations on behalf of wee Jenny who has an appallin bad back and that is why she has bin on the sick for 6 months”.

    The point of public services is that as well as serving fee paying punters, they also serve people in the community who wouldn’t otherwise have access to these services – e.g. Autistic kids getting swimming lessons, people with chronic health conditions and disabilities getting tailored gym sessions, holiday schemes for kids with trampolining, football, swimming etc. provided at a fairly reasonable cost to parents.

    You are right that a private operator is likely to be “more efficient” but will they continue to provide the same range of services to the community? Probably not, because these services by their very nature are inefficient / not commercially viable.

    So what we could end up with is a much slicker, better commercial offering, probably with prices to match…but one that doesn’t offer the same outreach to people whose needs cannot be easily streamlined and made more efficient. So either people are priced out of using the new and improved services or they can’t access the services because there is no longer anything tailored to their needs…or BCC / Belfast Health and Social Care Trust ends up paying the private operator to continue providing these services. Which is a slicker, more efficient business model…that we still end up paying for.

  • jammc98

    I smell a spotlight…………

  • chrisjones2

    the real scandal is that the counicl has been paying 2 x thye uk average for its own staff to ‘manage’ them

  • chrisjones2

    so the council has been providing services that noone really wants enough to pay for and along the way has been running at 2 x the subsidy level in the rest of the UK?

  • “Services that no one really wants enough to pay for”

    Undoubtedly in some cases this is true. I wouldn’t say that is the case in the services I have outlined above, though. There is a difference between services on offer that ought to be more commercially viable and those that are being provided for people who are in need of the services but who couldn’t afford to pay the going rate for these in the private sector.

    I think the existing leisure centres have their problems but they do a good job when it comes to this. It is unlikely a private operator will do the same but BCC / Belfast Health and Social Care trust are unlikely to be able to justify these services disappearing entirely. So they will continue to provide them, but they will be paying GLL to run them.

  • And today BBC NI is reporting on Belfast City Council’s inability to confirm any major international events in the city for the 2016-2021 period, due to a lack of financing to the tune of apprx £2.66m.

    http://www.bbc.co.uk/news/uk-northern-ireland-30581104

    So is that it, everything is just cancelled then? Apparently not, since BCC are considering the option of “using rates to meet the funding requirements, stating that
    committee members may “need to consider such funding as part of the
    rate-setting process”.”

    Waterfront extension, Leisure Centre refurb and ambitious international events calendar left you broke? Help yourself to the rates money, sure!

  • Comrade Stalin

    Personally I’d rather have more basic facilities that I can afford to use and that are local to me

    Pure Gym are in the city centre and are IIRC cheaper than any of the council gyms. Fitspace in Boucher are also cheap.

  • For me there’s a few factors:

    – I have young children that I can take to a leisure centre and not a private gym

    – I can use a leisure centre whenever I feel like it, no monthly contract. Granted a monthly contract offers better value for money but in a lot of private gyms it’s a 12 month commitment, and given that a lot of my work is freelance and paid erratically I would rather have fewer monthly outgoings

    – Swimming pool – I mostly use the leisure centre to swim / sauna, only occasionally for the gym. A private gym with a pool costs a good bit more than Fitspace

    – I can walk to the leisure centre!

    I appreciate some of these circumstances are unique to me and Don’t apply across the board, so Fitspace et al may well be the better options for some. But they are not better for me personally.

  • disqus_QjXz9NPnll

    As an employee of said service I can tell you that the problems in Leisure Management for BCC was caused by lack of experience in the Senior Management Team who guided strategy, investment, staff development amongst other things without ever having stood on a poolside, put up a badminton net or even cleaned a toilet in a leisure centre.These people ran this so called SERVICE into the ground so that in the end Leisure became tbe bad boy of all the council services. So rather than address issues like the failure of early oprening to generate more income, the poor standard of service supplied by other BCC Services, high SLA rates & red tape, lack of ability to manage budgets,ineffective procurement, poor labour relations, the list goes on! It was an easier option to off load it! From an insiders point of view, leisure not the worst just the easiest to point the finger at for ineffiencies and ineffectiveness because its more visable to the general public than some other services they provide,

    They tried to make a service, which was funded by European Peace money as a means to reduce antisocial behaviour during the troubles, into a profit making business & that was never going going to happen! For the last 8 years it was a nightmare to be employed in.

    If I could have taken VR I would have I can assure you of that!
    So finally, in terms of saving the rate payer money in salaries, wages & pensions dont be fooled! Nothing has changed.
    All the staff who remained are still on the existing terms & conditions of empliyment, rates of pay & pension rights as before!
    Rate payers should be asking themselves how those 60 reduncies are being funded….theres a FOI request in the offing! I bet £2million would have had quite a dent in it there and reducing foc use for some concessions from 4 hours a day to 2……private providers do not and will not let that happen…..theres more going on than meets the eye!
    But then the people on the front line were only ever treated like a bad taste left in the mouth!