Management of MRCLC

Posted on: Wednesday, 16 August 2017 at 12:53:17 PM

Who are Belgravia Leisure?

Belgravia Leisure is a company that manages leisure facilities right across Australia and New Zealand. They have extensive experience in managing everything from swimming pools to golf courses to ski resorts - and community recreation centres like ours. You can learn more about them at www.belgravialeisure.com.au

What is the arrangement with Belgravia Leisure?

Council pays Belgravia Leisure a management fee to run the Merredin Regional Community & Leisure Centre ("Rec Centre") for us.

This means they are responsible for the day to day operation of things - the hiring and firing, centre maintenance, planning and implementing programmes, liaising with sporting clubs, etc.

How did the decision to outsource the management of the Rec Centre come to be made?

We’ve had a good crack at managing the Rec Centre ourselves and we haven’t done it as successfully as we feel the Merredin community deserves. We’ve struggled with a high staff turnover and had difficulty getting and keeping good managers of the facility.

It’s not a new idea. We put it out there in surveys and consultation groups and we've talked to the Sports Council about different ideas including management of the centre by the Sports Council.  The offer to the Sports Council was declined.

Belgravia has a two-year contract with us. When that two year period comes to an end, Council will have to decide whether to take back the management of the facility, reappoint Belgravia, or take another path entirely. The decision will partly take into account whether Belgravia can reduce the deficit, but even if it costs a little more for them to run it than we could run it ourselves, if they can do a better job of running the Rec Centre for the community then the cost may be deemed to be worth it.

This does not, as has been expressed by some on social media, give Belgravia a blank cheque or a bottomless pit of money to do whatever they like - that would certainly be the quickest way to ensure their contract would not be renewed. Any major initiatives they wish to undertake which involves significant cost or works has to go back to Council. And neither do Belgravia make any profits which are directed elsewhere from the Rec Centre.

Why Belgravia?

We've had conversations with a number of organisations about managing the Rec Centre, but when given the opportunity to tender for it, the only submission we received was from Belgravia Leisure. Their submission ticked all the boxes, and Council voted to appoint them for a fixed 2-year period. Their whole reason for existing is to make leisure centres run well. They have a national network of experience, knowledge and resources to draw from which we simply don't have. It made sense.

So what’s the story with the proposed gym then?

One of the ideas that Belgravia has proposed is a 24 hour access gym as part of the Rec Centre. They believe it will help reduce the deficit of running the centre, and add value for the sports clubs and casual users.

It has been said on social media that any profits from a gym at the Rec Centre will go to Melbourne. This is not true - Council are paying Belgravia a fixed fee, whether or not the gym goes ahead.

Belgravia do not pocket any profits from the gym (or the bar, or programmes, for that matter). Any profits from the gym (or the bar) at the Rec Centre go back into reducing the annual operating deficit and supporting the Rec Centre. All profits from any initiative at the Rec Centre reduce the cost of the facility to the ratepayer.

But there's already a gym in town. Surely the town doesn't need a second gym?

We weren't altogether convinced either. That's why Council decided at the December 2016 Council meeting that Belgravia should be required to prepare a business case giving reasonable evidence for the viability of a gym at the Rec Centre. They did so, and it was presented at the May 2016 Council meeting.

On the basis of the business case, Council made the following resolution:

81978    That:

  1. the proposal for Belgravia Leisure to develop a 24/7 access gymnasium in the Early Childhood Room at the Merredin Regional Community & Leisure Centre be approved in                 principle but its commencement be deferred until the agreement with Belgravia Leisure is                 extended, should it be extended; and
  2. Belgravia Leisure be permitted to undertake the proposal in its own right prior to the expiry of the current agreement, should it wish to do so, on terms and conditions to be determined.

What that means is that Belgravia does not have Council's blessing to install a gym within the current 2-year contract at ratepayer’s expense. If it's so central to Belgravia's successful management of the centre that they want to go ahead and do it anyway without Council's green light, they have to do it entirely out of their own pocket, and if their contract is not subsequently renewed, they are responsible for the ongoing equipment lease costs.

Belgravia's business case for a gym at the Rec Centre involves a 5-year lease of gym equipment rather than outright purchase of it. Council's resolution ensures that there is no cost or financial risk to the ratepayer in the event that Belgravia's contract is not renewed.

And what if the contract is renewed?

It's an agreement in principle - it's still not carte blanche to go ahead and do it. If the contract is renewed and Belgravia still want to go ahead with the gym, they have to go back to Council and get them to agree to it again.

This information is provided to clear up any misconceptions about what is going on at the Rec Centre.  If you have any queries please feel free, in fact you are encouraged, to contact either Belgravia Leisure, Councillors or Shire Management.

 

 

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