Posted by: westlancashirerecord | August 21, 2018

Serco So Far

“Serco So Far” was written in 2007 by a local Labour politician, Paul Cotterill, when he was the Shadow Portfolio Holder for West Lancashire Borough Council Leisure Services. The official record of the relationship between Serco Leisure Operating Ltd (SLOL) and West Lancashire Borough Council (WLBC) shows how disturbingly close that relationship had become right up until the recent, May 2018, service of the Breach of Notice Order in respect of the Beacon Park Golf Course, on SLOL.

It began on 21 September 2004 when Ian Phelps ”For and on behalf of Serco Leisure” categorically confirmed to John Nelson Acting Leisure Services Manager WLDC how critical it was for Serco to have Authority to Proceed with building works, ie “building enhancements and refurbishment” and confirmed at Council on 20 October 2004 that a cost of “up to £610,000 had been approved within the Capital Programme to cover the potential costs of reimbursing Serco for improvement works to leisure facilities” included in the Report of Councillor D.A. Westley and John Nelson.

West Lancashire Community Leisure Trust is a partnership arrangement between the Council, the Trust Board and Serco Leisure Limited. The Trust commenced operation of five of the Council’s sports facilities, two swimming pools and three dry sports centres, on the 1st January 2005.

The Beacon Park Golf Course (BPGC) was not included, having been leased to DCT Leisure Ltd in July 2000. They, DCT Leisure Ltd, had a lease agreed which included a 5 year partnership for the Golf Course, Driving Range, Pro Shop and Beacon Centre Catering with DCT having responsibility for the delivery of these services and capital investment improvements. The terms also included an obligation for DCT to meet the requirements of a management agreement and an option for a renewal for a further period of 5 years.

You’d think that a WLBC asset valued then at almost £2,000,000 would be subject to strict scrutiny. DCT Leisure made capital investments in the course and centre over the first 5 years reputed to be worth approximately £120,000. WLDC, as it was then, received fees from DCT Leisure Ltd of approximately £25,000 per annum. This contrasted with an operating deficit of £106,000 in the year prior to DCT Leisure being engaged.

Officially “The District Council has relinquished all operating costs for the facilities, with the exception of structural maintenance to the buildings, and presently receives fees from DCT Leisure of approximately £25,000 per annum. This contrasts with an operating deficit of £106,000 in the year prior to DCT Leisure being engaged”. What evolved out of this “impressive” change in fortunes was total neglect by WLBC of any due diligence of DCT Leisure Ltd as it slipped into debt, ultimately not paying VAT, and finally insolvency. You might view this  as its legacy?

The Labour report “Serco So Far” included Item 8 GOVERNANCE as copied below.

“8.1 We have already commented several times in the report on the relative weakness of the board of the Leisure Trust. What needs to be stressed is that there is no criticism of individual members of the board; there is no reason to question their integrity, their general commitment to public service, or their personal capacity to undertake their role as trustees and guardian of the public interest.

“8.2 We contend that the problem is structural and institutional. The board, from its establishment, has been too ‘close’ to SERCO, and has become identified as a defender of SERCO’s interests rather than an appropriate challenge to SERCO on its public service delivery commitments.

“8.3 Interestingly, the Trust did in fact agree an ‘objective and aims’, set out in the initial Trust agreement and memorandum of association, which are clearly focused on meeting the needs of the public, including ‘promoting health and wellbeing’ (see Appendix D). However, in practice these aims and objectives have been ignored in favour of SERCO’s interests.

“8.4 As one example of this, we have referred to the fact that to date the board has not effectively challenged SERCO on its failure to provide effective data of the sort promised with ‘Legend’, but again seemingly delayed in implementation. As another example, we have pointed out that the most recent Leisure Trust report to Cabinet (Appendix C) sets out success and failure almost exclusively in income terms, rather than in terms important to the public – how much the public uses it.

“8.5 This has obvious long term implications for what is delivered, unless corrected urgently. It also has shorter term implications, in that currently it may be difficult to defend the charitable aims of the Trust when it seeks charitable status form the Charity Commissioners, given the close relationship with a private sector organisation rather than the public good. This in turn would have negative consequences for the Trust’s finances.

“8.6 Finally, we are somewhat concerned about the way in which the District Council’s Leisure Services Manager has been pulled towards operational matters, rather than being able to focus on ensuring that the Trust, with SERCO’s delivery, are delivering the public service outputs and outcomes that they should be. At this stage there has been no in-depth review of this area, and it may be that this impression comes over because of the way our operational questions have always been referred through him, with apparent reluctance on the part of SERCO to deal directly with the Shadow Portfolio holder. At the very least, though, in a situation where the contract is often too loose to enforce, and where the Trust is not properly taking on what should be its scrutiny responsibilities (see above), there must be a real danger that the whole partnership ‘triangle’ of Council, Trust and SERCO will effectively collapse into one single mass of operational endeavour, without due scrutiny or accountability”.

This is part 1 of “Serco So Far” as we record the events leading to what has been created at the Beacon Park Golf Course, from official records and exchanges of emails with officers.

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