1. © Grant Thornton UK LLP. All rights reserved. Review of Leisure Services Vale of Glamorgan Council Final Report- November 2009

2. © Grant Thornton UK LLP. All rights reserved. 2 Content Introduction –National Context –Local Context –Audit Scope and Approach Key Messages Review Findings –What are the key issues facing the Service? –What is known about the market that the service is operating in? –How does the Service compare against others, in respect of the model of provision and performance levels achieved? –What are the options for change that should be considered? –What are the key decisions that the Council, to develop a way forward? Next Steps Action Plan

3. © Grant Thornton UK LLP. All rights reserved. 3 Introduction and Background The Council's leisure centre stock is increasingly ageing and changes in the market, including the economic downturn and private sector development, is a key challenge. Given this, time has been included within our audit plan to consider the Council's Leisure Strategy, to ensure that it is fit for purpose, reflecting the social and economic context that it is now operating within. The National Context In most authorities, expenditure in this discretionary area has not kept pace with the deterioration of assets for many years and the number of new facilities opening has fallen significantly. At the same time, public expectations have increased following the growth of the private sector market. Expectations are also increasing from central government and the Welsh Assembly Government (WAG) in respect of sports and leisure services, as the contribution that they can make to the achievement of wider social objectives is recognised. 'Climbing Higher' sets out the WAG strategy for Sport and Physical Activity and the immediate aspirations that all authorities should aim to achieve. The Local Authority Partnership Agreement (LAPA) signed by the Council, Health, the WAG and Sports Council Wales reflects the Council's response to this national directive.

4. © Grant Thornton UK LLP. All rights reserved. 4 Introduction and Background The Local Context There has been an awareness of issues with the Council's Leisure Service for a number of years. A review was commissioned from Torkilsden Barclay (specialists in leisure and sport consultancy) in 2006, who raised a number of concerns, including: –the low level of expenditure on asset renewal, significantly below that needed; –a high level of unmet need for sports halls and swimming; –tired facilities, with front of house and changing accommodation particularly poor; –low morale; and –insufficient marketing resource. Although there have been some changes since this review, the key issues to be addressed still remain.

5. © Grant Thornton UK LLP. All rights reserved. 5 Introduction and Background The Local Context- continued In particular, the report concluded that the Council needed to decide whether to: –leave the Service as it was; –refurbish facilities; –set up a leisure trust; or –enter into a partnership with an existing trust. We understand that a decision has yet to be made on the best way forward. A report to Scrutiny, in February 2009, by the Director of Environmental Services recommended that Scrutiny referred to Cabinet ongoing concerns regarding the funding and performance of the Service. A further update was presented in September 2009, detailing the extent of the issues and need for decisions to be taken regarding the future. To date, we understand that this has not yet appeared on the agenda for Cabinet. Despite the challenges, usage levels remain high, with Council facilities receiving almost 1 million visits in 2008/9 (although this number has been in decline for the last 4 years).

6. © Grant Thornton UK LLP. All rights reserved. 6 Introduction and Background Audit Scope and Approach Given this background, it was agreed with lead officers that our work should follow up the concerns previously raised (to validate their continued currency) and provide an up to date position on the key issues facing the service. Five key questions were agreed as a framework for the review. –What are the key issues facing the Leisure Service? –What is known about the market that the service is operating in? –How does the Service compare against others, in respect of the model of provision and performance levels achieved? –What are the options for change that should be considered? –What are the key decisions that the Council needs to take, to develop a way forward? We have sought to answer these questions through interviews with lead officers, reviewing relevant documentation, visiting the Council's facilities and comparing performance against that of other authorities.

7. © Grant Thornton UK LLP. All rights reserved. 7 Key Messages Our review found evidence that officers working within the Service are working hard to make the resources available adapt to a changing market. However, a key objective of the review was to assess the fitness for purpose of the Council's Leisure Strategy. This has not been possible as there is no documented strategy or vision for the Service, formally or informally agreed (although the LAPA provides a framework for the development of operational activity). The lack of a clear strategy may explain why the concerns, recognised for a number of years, have yet to addressed, including; –historic underinvestment in leisure assets, leaving some facilities in a poor state of repair; –pressures to reduce costs and deliver greater efficiencies, to support the financial position of the Council; and –reducing demand for some services stemming from both the impact of the recession and the growth of alternatives within the local market.

8. © Grant Thornton UK LLP. All rights reserved. 8 Key Messages- continued The priority for the Council is to decide on the most appropriate mechanism for delivering leisure services in the Vale, to address these and the other issues emerging. However, any decision on the future of services can only be taken once there is a clear and comprehensive picture of the current state of provision (in respect of needs and available services) and the objectives that the Council is striving to achieve through the Service. Action must be taken, as a priority, to develop this understanding and ensure that any options are consistent with the Council's wider ambitions for the area. Given this, the key recommendations emerging from our work are as follows: –understand current provision and the leisure service market in the Council area; –clarify the vision, the objectives and the strategy for the Service; and –agree the best option for delivering this strategy, moving forward. The next section of the report details the review findings under each of the five audit questions.

9. © Grant Thornton UK LLP. All rights reserved. 9 Review findings What are the key issues facing the service? Our recent work suggests that officers are actively seeking to address the issues facing the leisure service in innovative ways and with limited resources. For example: –underused space in two facilities has been transformed into soft play areas; –high specification gym equipment has been purchased so that fitness suites offer the latest technology (funding has recently been approved from the Social Services Well- being budget for new equipment in Penarth); and –one centre manager has cleared an unused room and decorated it in order that it can be used as a community facility/conference room. This reflects an understanding of the changing demands of the market and the desire of officers to respond, using alternative sources of funding, when necessary and possible. The following slide summarises the key issues facing the service. They are presented as matters regarding assets, the service offer and management.

10. © Grant Thornton UK LLP. All rights reserved. 10 Review findings What are the key issues facing the service? - continued Service Assets Investment in the service has been limited for a number of years (at approx £150k pa, which covers six leisure centres, 22 community centres and Jenner Park football stadium. Torkilsden Barclay forecast, in their report for the Council, that £340k pa would be needed for lifecycle costs for the leisure centres, over a 25 year period, if they were new build). Particular concerns have been raised regarding the front of house areas and changing accommodation. There is no rolling programme of planned maintenance. Most work is reactive. There has been no detailed survey of the condition of buildings. Most facilities have excess space which is not always being well used, due to the lack of funding needed for refurbishment. Former bar areas, squash courts and cafeteria spaces are often dormant or underused. Service Offer Due to lack of investment noted above, the current offering is mostly based on historic provision. Although there are attempts to better match the offering to demand, as noted, there is no strategic plan for achieving this.

11. © Grant Thornton UK LLP. All rights reserved. 11 Review findings What are the key issues facing the service? - continued Service Management Currently, the Council has no clear vision or strategy for the Service. Our review suggests that the contribution that the Service can make to the delivery of wider social priorities of the Council is not formally recognised within corporate plans. Joint working between the Service and other services, both within the Council and externally (including Education, Health and Police services) has been limited, although officers from the Leisure Service participate in lead partnership bodies and actively seek to engage others in the delivery and performance management of the LAPA. The Service is required to make efficiency savings over the coming two years of 10%. Management capacity is limited. This is reflected, for example, in the lack of resource available to undertake market research.

12. © Grant Thornton UK LLP. All rights reserved. 12 Review findings What is known about the market that the service is operating in? The review of Torkilsden Barclay in 2006 found that there was no market research information available at the Council. Our work confirms this position, despite the impact of the International Sports Village in Cardiff Bay and the new JJB facility at Leckwith. Work is needed to: –ensure that needs are understood; –the views of participants and non-participants are recognised on all aspects of the Service offering; and –map the offerings, from all providers, across the Council area.

13. © Grant Thornton UK LLP. All rights reserved. 13 Review Findings How does the Service compare against others? Comparative information made available for the review shows that: –in 2007, customer satisfaction was higher than in 2005, with the Council scoring above 90% for all measures (inc parking, access, activities on offer, range of activities); –the number of visits is relatively high compared to other local authority facilities in Wales, although the Service fell from third highest to seventh highest between 2007 and 2008; –the level of subsidy for the Service is relatively low at £23 per head (the Welsh average is £33 per head) –the spend per head of pop ( based on 2007- mid year estimates) for recreation and sport is the third lowest in Wales; and –2009 data on swims per head of population shows that the Council's performance is average in this area (9th = out of 20 authorities with available data). Whilst this presents a useful starting point for considering performance, more up to date and complete information is required to understand the Service's relative position.

14. © Grant Thornton UK LLP. All rights reserved. 14 Review Findings What are the options for change that should be considered? Within the introduction to this report, the options for change recommended by Torkilsden Barclay, in 2006 were listed. They included 'do nothing', refurbish existing facilities, set up a Leisure Trust, or enter into a partnership with an existing trust. However, no decision was made by the Council on the future of the Service following this work (although the option to establish a Leisure Trust has been ruled out). Given the economic and other changes since this work, any options for change will require further work, to ensure that they are based on an up to date understanding of local needs and performance. The Council should also consider: – the opportunities for closer joint working with Education, Health and other public sector bodies, who all have an interest in the delivery of appropriate and cost effective sports and leisure facilities; and –closing one or more facilities.

15. © Grant Thornton UK LLP. All rights reserved. 15 Review Findings What are the key decisions that the Council needs to take, as it develops a way forward? As a result of the issues raised and the decisions that need to be taken, the Council needs to: –ensure that it has a clear understanding of the market for leisure services; –clarify it's vision and strategy for the service, in collaboration with key partners and within the context of the Council's over-arching strategy; –assess how any gap identified between what's available and what's needed can best be filled; and –fully develop the options for the service, to deliver this vision, ensuring that they are supported with a full cost/benefit appraisal. In the short term, the Council needs to recognise the position of the Service and make available the resource to address the above action points.

16. © Grant Thornton UK LLP. All rights reserved. 16 Review Findings What are the key decisions that the Council needs to take, as it develops a way forward?- continued In the longer term, the Council needs to make a decision as to whether or not to manage and provide services in-house or consider a partnership arrangement with an external organisation. Whether the management of the Service is retained in-house, or outsourced, the Council will still need to be clear about it's vision and the objectives that any service provider must deliver against. We consider that the key to making the right decision for the Council is undertaking the detailed supporting work that clarifies exactly where the service is and where it needs to get to. When this is understood and agreed, member, officers and partner organisations will be able to determine the most appropriate course of action.

17. © Grant Thornton UK LLP. All rights reserved. 17 Review Findings In view of the issues raised through this review, we recommend that work is undertaken to: Understand current provision –undertake a detailed audit of space usage within facilities; –map the full range of services available across the Vale area, both Council owned and privately operated –undertake a needs assessment exercise- what do customers want? –prepare a comprehensive and up to date picture of performance Clarify the vision for the service –agree how the Service can and should contribute to the achievement of the wider corporate agenda Agree the best option for moving forward –develop a number of options for moving the service from it’s current position to the vision agreed; –undertake a full cost/benefit analysis of each of the options; and –agree the best option for moving forward

18. © Grant Thornton UK LLP. All rights reserved. 18 The Way Forward The Council needs to implement the action plan agreed, focusing on the work to improve understanding of current provision and clarify the vision for the Service. This will inform the debate as to the best option for service delivery, in the coming years. We will return to follow up progress as part of our audit in 2009/10. We are grateful to all officers who contributed to this review, particularly Chris Fray and Dave Knevett.

19. © Grant Thornton UK LLP. All rights reserved. 19 Action Plan RefRecommendationPriorityAgreedResponseResponsible officer/ due date Understand current provision 1Undertake a detailed audit of space usage within facilities. MediumYesTo be undertaken using existing resources within 6 months. Dave Knevett March 2010. 2Map the full range of services available across the Vale area, both Council owned and privately operated. MediumYesAs above.Dave Knevett March 2010. 3Undertake a needs assessment exercise- what do customers want? MediumYesTo be undertaken subject to availability of resources. Dave Knevett March 2010 4Prepare a comprehensive and up to date picture of the Service's performance. MediumYesTo be undertaken in parallel with market testing. Dave Knevett March 2010

20. © Grant Thornton UK LLP. All rights reserved. 20 Action Plan RefRecommendationPriorityAgreedResponseResponsible officer/ due date Clarify the vision for the service 5Agree how the Service can and should contribute to the achievement of the wider corporate agenda. HighYesTo continue with existing work relating to LSB Partnerships. Rob Quick to discuss with SMT. Dave Knevett and Rob Quick. Ongoing Agree the best option for moving forward 6Develop a number of options for moving the service from it’s current position to the vision agreed. HighYesOption appraisal to be agreed in discussion with Cabinet/Scrutiny. Dave Knevett End November 2009 7Undertake a full cost/benefit analysis of each of the options. HighYesTo be undertaken as part of a tender exercise. Dave Knevett/ Service Accountant. End February 2010 8Agree the best option for moving forward. HighYesReport to CabinetRob Quick April 2010