‘We know what we are doing now is not the right thing for the people of Sheffield' - questions raised about future of city's leisure facilities
Questions have been raised about the future and funding of Sheffield’s biggest leisure provider, following multi-million pounds bailouts for services that are expected to be brought back in-house within four years.
Sheffield City Trust runs 17 facilities across the city as well as some in Scarborough and Whitby, and has been given bailouts totalling more than £20million over the last two years.
Councillors on the economic scrutiny committee last put its finances under the spotlight last autumn following extra funding from the council.
Coun Martin Smith, who sits on the committee, said it was a shocking meeting that came with ‘one of the worst’ audit reports he had ever seen.
It revealed the Trust was ‘hemorrhaging cash’ and ‘draining’ its bank balance, leaving the council - its main funder - to pick up the costs.
It was on a path to recovery before Covid-19 hit this March that the council said caused income for leisure to cease overnight.
Last month the council announced it was providing up to £15 million to help SCT reopen most of its venues, except Ponds Forge, some of which will go towards the cost of around 300 redundancies planned at SCT and paying for losses at its venues outside of Sheffield.
This was £10 million more than budgeted for and the council said it will come from reserves.
Opposition councillors criticised the council for making the decision on such a large amount of money without the chance for them to call it in for scrutiny, but since then a discussion was tabled.
Coun Shaffaq Mohammed, leader of the Liberal Democrats, said this meeting which took place on Tuesday night opened a ‘big can of worms’.
Coun Ian Auckland, who sits on the committee, said: “Based on our previous meeting, I’ve not got a lot of confidence in how things have been run in recent years and I hope our own officers will be pouring over the proposals and figures to satisfy themselves that the support the council is giving is getting the taxpayer a fair deal.”
Ryan Keyworth, council officer, said: “We meet with SCT what feels like daily to make sure we are staying on top of the financial position they are in and trying to keep as close to it as we possibly can, recognising they are a separate organisation but one that we are providing a significant amount of money to support.”
A number of questions were also raised about whether the council will take services back in-house in the future, ending its relationship with SCT. Coun Mohammed Mahroof said: “What we are discussing today affects thousands of employees and hundreds of thousands of people who use these facilities, not least the reputation of Sheffield as a city of sport.
“What it feels like to me is we have a house here and the foundations are failing, what we need to do is either replace them or pile on them. What we have been doing with the money we have been sending to the Trust is basically using good old fashioned wood chip to cover the cracks and we can’t continue with that for much longer. Do officers genuinely believe further funding to the trust will yield better results or do we need to change things more fundamentally? There are going to be hundreds of people who will be affected by this either through redundancy and those who use the facility. We are still the owners of all these properties and is there going to come a stage where SCT will return the keys to us and say ‘we can’t do this anymore’?”
Lisa Firth, director of culture, parks and leisure at the council, said the venues are due to be handed back to the council in 2024 anyway as part of the original lease agreement signed when SCT was formed.
She added: “Facilities will need improvements and may need redevelopment but these are all the options we are looking at and hope to bring to members and the public before Christmas with some proposals and options to restart that work we did on the leisure strategy we had to stop in March because everything closed down. We know what we are doing now is not the right thing for the facilities and the people of Sheffield.
“We haven’t had a direct conversation with SCT about handing the keys back because that has all sorts of implications for SCT and the council we need to understand fully before we go down that route. It is a feasible option and it is something we are considering as part of our leisure strategy.”
In the meeting, questions were also raised about Ponds Forge and the announcement to reopen it in October despite the council previously saying it was too expensive.
In response, Coun Mary Lea, cabinet member for culture, parks and leisure, said: “We have listened to people and we have listened to the proposals that have come forward. If people want to call it a U-turn that’s OK, as long as you make the right decision then a U-turn is the right thing to do.”
Officers said they were working on the details of how much it will cost and how it will work, and a report will be published next week ahead of a cabinet meeting on September 23.
Going forward, the scrutiny committee called for lessons to be learned from, and a possible inquiry into, everything that had happened with funding SCT.