Agenda item

Members considered the Rubicon Leisure Budget Report.

The Committee was advised that the budget report had been drafted to support the Rubicon Leisure Business Plan 2024/25.  Financial sustainability underpinned proposals detailed in the report, in line with that plan.

The company remained in a position where a subsidy continued to be requested from the Council.  However, as detailed within the business plan, there were actions being taken to reduce this subsidy.   As such, the Managing Director was requesting a subsidy of £349,000 from the Council for 2024/25.  There were some services provided by the company on the Council’s behalf that would attract a lot of income, particularly sports activities.  However, heritage sites and the community centres were less likely to attract significant income, although they were recognised as valuable assets in the community.  Furthermore, Members were asked to note that the Leisure and Cultural sector was still recovering from the impact of the Covid pandemic and further improvements in income could occur moving forward.

The level of funding that was being requested by Rubicon Leisure Limited from Redditch Borough Council for 2024/25 was less than in previous years, which indicated that progress was being made.  In addition, Members were asked to note that in the 2021/22 financial year a significant amount of financial support had been requested by the company from the Council which had not been used and this would be returned to reserves for future investment.

Reference was made to forthcoming pressures that could impact on costs associated with the assets managed by Rubicon Leisure Limited on behalf of the Council.  Officers explained that the Council would soon be required to ensure that all properties achieved at least a minimum Grade C EPC rating, including sports and leisure venues and community centres.  This would potentially result in an increase in costs for asset management, although the Palace Theatre was already performing well in respect of this issue, as LED lighting had been installed in the building.

A number of areas were discussed by Members during consideration of this item:

·             The extent to which budget data was up to date, given difficulties that had been experienced with the Council’s Tech1 finance system.

·             The income received from the café at Morton Stanley Park.  Members were reminded that this café was operated by the Council rather than Rubicon Leisure Limited.

·             The extent to which the Shareholders Committee had the authority to change the budget for Rubicon Leisure Limited.  Officers clarified that the Shareholders Committee did not have the power to change the company’s budget, although Members could change the level of subsidy awarded to Rubicon Leisure Limited.

·             The stage that had been reached with the submission of the company’s accounts, in a context in which there had been challenges with the Council’s Tech1 finance system which was also used by Rubicon Leisure Limited.  Officers explained that they were aiming to have the 2021/22 accounts in draft form by the end of June 2024 and the 2022/23 accounts in draft form by the end of July.

·             The main issues with the Tech1 system that had impacted on the accounts for Rubicon Leisure Limited.  Officers confirmed that there had been significant issues with the cash receipting part of the Tech1 system, which had particular implications for Rubicon Leisure Limited because many customers paid for services using cash.

RESOLVED that

the Rubicon Leisure Budget Report 2024/25, and its underlying assumptions be approved.

(During consideration of this item, Members discussed matters that necessitated the disclosure of exempt information. It was therefore agreed to move to exclude the press and public prior to any debate on the grounds that information would be revealed which related to the financial and business affairs of any particular person (including the authority holding that information)).