Members of the public who live or work in the district are invited to put one question or statement of not more than three minutes duration relating to items to be discussed in Part 1 of the agenda only. If a question is asked and answered within three minutes, the person who asked the question may ask a supplementary question that arises from the reply.
As the meeting is taking place virtually, a person who wishes to speak must register by 9am on Monday 9 November 2020 to ensure that there is time to brief them on how they can speak at the meeting. This can be done by sending the request to firstname.lastname@example.org
or by telephoning one of the numbers provided on the Public Information Sheet at the start of this agenda. Members of the public will either be set up as a ‘Guest Speaker’ or be provided with a telephone number they can call when prompted to do so during the meeting to enable them to participate.
If a member of the public cannot attend the meeting remotely, they may submit a written question or statement to Democratic Services by midday at the very latest on the day of the meeting and this will be read out on their behalf during the meeting.
There is an overall time limit of 15 minutes for public speaking, which may be extended at the Chair’s discretion.
1. Frank Stennett, a resident of the district, made a statement in connection with the Abbeycroft COVID-19 Loan Facility. As Mr Stennett was unable to attend the meeting, his statement was read out on his behalf by a member of the Democratic Services Team.
Mr Stennett’s statement covered the following specific points:
· If the Council were to provide a loan to Abbeycroft on market terms, then it would not consititute State Aid, as the Council was acting in line with the Market Economy Investor Principle (the “MEIP”).
· When making such a loan, the Council needed to carry out prior due diligence to demonstrate that the loan was a prudent use of the Council’s resources and, as such, that any other lender would have provided a loan on those terms.
· Raised concerns over the management costs of Abbeycroft Leisure, which had increased significantly in 2018/2019 (by £100,000), compared to 2017/2018. Therefore, the Cabinet should also be reviewing the accounts for 2019/2020 before any decision was made.
· Concerns that the loan provided no certainty for the Council, particularly with the payback period, loan rates and also the proposal for extending some of the loan term to 10 years. In his view, the Council should be offering a fixed rate loan for a set term, which would then enable Abbeycroft to be able to budget to repay the loan.
In conclusion, Mr Stennett asked the Cabinet to reject/alter the loan terms which were being proposed.
Prior to the response by the Portfolio Holder, Councillor John Griffiths, Leader of the Council, thanked Mr Stennett for his statement. Councillor Griffiths explained that the loan had been structured to take into account the various circumstances and that the Portfolio Holder would respond to the specific points made in relation to the terms of the loan, State Aid and the accounts/management costs. However, in general terms, Abbeycroft and the Council had a priority to serve its community in West Suffolk and to ensure that its leisure services were cost effective and available to everyone, which was now even more important in the current COVID pandemic. Of course, the Council did need to protect its own interests, however, these would be different to how other private sector lenders may view this, as the Council did have a wider social responsibility.
In response, Councillor Joanna Rayner, Portfolio Holder for Leisure, Culture and Community Hubs, thanked Mr Stennett for his question. She explained that the Cabinet had agreed to a loan facility in July 2020 and were now being asked to consider and agree to the final terms of £500,000 of that £1m loan facility. During the last few months, Officers had had a number of open book discussions with Abbeycroft on the impact of COVID-19 and their recovery business model. Abbeycroft had undertaken a number of changes since March 2020, to reduce that cost base and to take advantage of the support which had been available, such as the Government’s furlough scheme.
Since July 2020, the Council had also conducted the necessary due diligence, to not only demonstrate that the loan fell within the State Aid rules, but to also be satisfied that this was a prudent use of the Council’s resources, both now and in the future. The loan agreement would have a number of loan conditions and safeguards and it was important to note that the loan would be fully secured.
Councillor Rayner further explained that the Council had a long-term collaboration agreement with the Trust to operate its five Leisure Centres and to deliver wider health and wellbeing activities and that partnership was operated on an open book basis. This loan facility was about providing certainty to the Council’s communities, through creating financial capacity and stability to ensure the continued delivery of leisure services across West Suffolk through Abbeycroft. The importance of a strong and varied leisure and sports offer would be ever more important to seek to recover from this pandemic and protect and improve people’s health and wellbeing.
Councillor Rayner also addressed Mr Stennett’s specific question with regard to Abbeycroft’s management costs and explained that South Suffolk Leisure, who were a registered charity who operated facilities for Babergh District Council, merged with Abbeycroft Leisure on 1 October 2018 to form a larger charity, maintaining the name of Abbeycroft Leisure which had impacted on the management capacity. This was explained in the Trust’s Annual Report, which accompanied their accounts.
Councillor Rayner concluded by stating that Members would be able to discuss any of the detailed financial issues set out within the exempt Appendix, in the private part of the meeting.
Councillor Sarah Broughton, Portfolio Holder for Resources and Performance, also wished to reassure Mr Stennett that the Council had been working closely with Abbeycroft Leisure, over the last few months, which had included access to their financial records through the open book approach. From the work which had been undertaken with regard to due diligence and with the Council’s local communities in mind, she was supportive of the proposals which were set out within the report.