New set up for leisure services no longer favoured

Monmouthshire council no longer favours setting up a new body to provide tourism, culture, leisure and youth services, a report says.

Last year the Conservative-led county council agreed to establish an Alternative Delivery Model (ADM) to secure “a viable and sustainable future” for services.

The move was opposed by opposition Labour councillors who raised concerns the ADM was a “tax avoidance model”, arguing that if it failed tax payers would foot the bill.

Cllr Bob Greenland, cabinet member for tourism and leisure, said the move was “probably the biggest change in service delivery during the term of this council.”

But a report set to go before councillors next week recommends not to progress with the new model, but instead to retain and transform services in-house.

Council bosses say that since the different options were assessed financial and legal issues have changed significantly.

A report says the financial case for moving to an ADM now offers “only marginal benefits” to the council.

Tax reforms mean there is an “increasing risk” that favourable taxation for leisure trusts is removed, the report says.

“The gain is not substantial enough to justify the energy that will need to be invested to realise it,” it says.

Recent changes in accounting for VAT also mean the in-house option could bring savings of around £250,000 per year.

This is because VAT on sporting facilities could be treated as exempt if the council agrees to adopt a new ruling next Thursday.

The council’s recent purchase of Newport Leisure Park for £21million has also demonstrated that the authority’s ‘commercial ethos’ is developing, a report says.

“The council is now an ‘investing council’ and has the portfolio to evidence this assertion,” it says.

A commercial focus can now be further developed with services kept in-house, it is said.

Another reason given for keeping services ‘in-house’ is that there is evidence of ‘instability’ in similar trust models, which is a concern for the council.

MonLife, a charity set up by the council to deliver services, will still continue but it will revert to an ‘in-house’ model, rather than an ADM.

The council spent £155,000 securing advice and exploring the possibility of an ADM, but a report says this money was not wasted.

“Such costs should not be seen as abortive,” it says.

“The costs incurred to date have been beneficial in determining the options for the future sustainability of MonLife services.

“Furthermore taking a decision at this point in the process has preventing significant further staff time and advisor costs being incurred, most notably legal costs.

“Efforts will instead be channelled into developing the transform in-house model.”