Future of Kettering Leisure Village not ‘financially viable’ if council forced to step in

Options for the future of Kettering Leisure Village (KLV) will be discussed by North Northants Council’s place and environment scrutiny committee next week (Monday, March 25).

The Future of Kettering Leisure Village - Options Review produced by consultants Max Associates, examines costs, legalities and operations of the leisure, theatre and conference complex.

Over 52 pages, the review looks at KLV’s beginning to its near-closure last year, examining potential costs and risks to the already hard-pressed unitary council’s funds.

The review compares operating costs for three management models – in house, external and Local Authority Trading Company – if the current management arrangements change.

Consultants have looked at implications to NNC if it came into full control of the council.

According to the report, even the ‘cheapest’ option – an external contractor – would result in an additional cost to the council of £254,857 which it says ‘is not financially viable for the council’.

Currently a covenant on the lease states the land on which it is stood must be used for leisure purposes.

NNC has ‘step-in rights’ if the sports area is closed for 48 hours or more.

The council also has a funding agreement that retains the use of the Arena Sports hall courts, and the Lighthouse Theatre. The council currently pays more than £300,000 a year towards the sports facilities – an amount set to rise £28,000 in 2023/24 – and £30,000 towards the theatre.

Residents and KLV users were in uproar last year when Compass Contracts Services UK Ltd (CCS) announced they were pulling out of KLV – affecting sports and court users, theatre-goers and gym members.

The options review follows last year’s eleventh-hour reprieve when a deal was brokered to find an ‘interim’ solution to support the site to remain open.

NNC says ‘no formal public consultation’ will take place into the recommendations in this report, as information ‘remains commercially sensitive’, but campaigners from the KLV Support Group have ‘engaged’ with Max Associates – PLMS strategic managers and site managers at KLV have also had discussions.

Using figures provided by the current management, projected operating costs show that KLV could generate £2,552,400, but total expenditure, including wages maintenance and business costs, could come to £3,028,632 – a deficit of £476,232.

A report prepared for councillors says: “Findings of report into options available the options review confirm all operating models would create a deficit funding position in the order of £255,000 and £484,000 per annum, requiring the council to reprioritise discretionary funding.”

Currently KLV is managed by Phoenix Leisure Management Ltd (PLML) that has invested £100,000 in repairs to the building and new equipment for its private health club.

At the start of this month, PLML managers said it was in ‘everyone’s interest’ to have a ‘successful offer and facilities long-term’. They had been looking to stabilise the business and also investigating two options for the company – relaunching the conference centre and bringing back the indoor soft play area known as Kids Play.

In the report produced for councillors the current arrangement with Phoenix Leisure is described as being ‘seen as a short term solution’.

Meanwhile, Max Associates have been commissioned to produce a North Northamptonshire-wide report into leisure provision across the whole area. The options appraisal is due to be completed in early 2025.

The report warns that public reaction could damage NNC’s reputation.

It says: “The reaction to the announcement by CCS of the proposed closure of KLV during 2023, from site users, stakeholders, businesses and the wider community demonstrated the importance of KLV. As such there is a risk to the reputation of the council should the site be at renewed risk of closure.”

Key findings from the management options review concludes an external contractor – the current option – is the most ‘sustainable’ solution as the whole of NNC’s leisure centres are reviewed.

It concludes: “We would suggest that, in the short term, an external contractor would be the most sustainable solution whilst the wider management model for the council’s entire leisure portfolio is considered.

"For example, if it was operated in-house in the short term, costs would increase significantly, then if the decision is made in 2024/25 to contract out the management of all council owned leisure centres the costs would be increased, and it would take longer for financial savings to be realised in the new contract.

"However, if the long term solution is an in-house model for all council leisure centres, then the financial impact will be less going from an external contractor to in-house.”

Max Associates has been appointed to work with North Northamptonshire Council to develop a suite of new key strategies – Active Communities Strategy, Leisure Facilities Strategy and Playing Pitch Strategy.

Cllr Jim Hakewill (Ind, Rothwell and Mawsley), who campaigned to keep KLV open said: “It’s disappointing that the community has one week, the minimum in law, to examine this detailed report that has taken nine months to produce. I hope that the scrutiny committee drill down into the detail.

"KLV is crucial to the well-being and economy of Kettering, and given the cost cutting we are seeing, I very much hope the council will recognise its importance to the community.”

The place and environment scrutiny committee takes place on Monday, March 25 at 7pm at the Corby Cube

Members of the public wanting to speak must register with the council by 5pm on Wednesday, March 20.

The meeting will be available for the public to view live https://www.youtube.com/c/DemocraticServicesNorthNorthantsCouncil