MD2126 Crystal Palace, National Sports Centre - Leisure Management
It is proposed to extend the current contract between GLA Land and Property Limited (GLAP) and Greenwich Leisure Limited (GLL) for a minimum of 2 years from the 1st April 2018 with an option to extend this by a further 1 year. This relates to the provision of leisure management services at the National Sports Centre, Crystal Palace.
That the Mayor:
• Approves the extension of the contract under which GLL provides leisure management services to GLAP for a minimum of 2 years from the 1st April 2018 with an option to extend this by a further 1 year (2+1 years).
• Approves an exemption from the requirements of section 9 of the GLA’s Contracts and Funding Code in order to allow for a short term contract extension without a competitive procurement exercise.
Part 1: Non-confidential facts and advice
1.1 The London Development Agency (LDA) and subsequently GLAP have occupied the NSC under a 125 year lease from LB Bromley. GLL have provided leisure management services since 2004 and their contract has previously been extended in 2009, 2014 and 2016. Their current contract expires on the 31st March 2018. GLAP has been responsible for the NSC since 2012.
1.2 It had been anticipated that a decision on the long-term future of the NSC would be taken in time to allow for a full procurement exercise for the management and operation of the NSC to be undertaken and implemented prior to 2018. However, the requirement for further investigation into some key areas of supply and demand (in particular, athletics) means that this is now not achievable and it is important that any decision is taken reflecting a full level of knowledge, with appropriate and up to date information available.
1.3 Working with the support of Sport England and UK Athletics, the GLA will shortly be commissioning research into the demand for athletics facilities (both indoor and out) in South London. This will also consider the range of existing facilities available and will reflect on changes taking place across London but particularly locally at Sutcliffe Park, Eltham and the proposals for Normans Park, Bromley.
1.4 Pending a decision on the long term future of the NSC, suitable arrangements for running the centre need to be in place and it is felt appropriate for the facility to be managed by specialist leisure management suppliers, as the GLA does not have the required skills internally.
1.5 GLL were procured by the LDA in partnership with Sport England in 2004 and have continued to provide services since. During that period they have contributed to expansion in the use of the centre, increasing the range of sporting activities and have worked with LDA/GLAP to reduce the financial impact of running the NSC. They have provided a good level of service, often in difficult circumstances and have provided a level of continuity during what has been, and continues to be, a period of uncertainty.
1.6 It is the opinion of officers that there would be insufficient market interest in a short term (2 + 1 years) contract to provide leisure management services to enable a proper competition and that a further extension of the GLL contract is the most realistic option at this point in time.
1.7 In view of the uncertainty regarding the future demand for the Centre it would also be difficult to create a specification that could be tendered against.
1.8 A full OJEU procurement exercise would be required even for a 2+ 1 year short term contract and this could take up to 12 months bearing in mind the size and complexity of the requirement. The current contract has less than 12 months to run and a short term extension would therefore still be required even if a decision was made to invite other bids to manage the facility for a short 2 year period. A short term extension for up to 3 years is therefore the most practical solution.
1.9 By extending the current contract with GLL during this interim period:
• Continuity of knowledge and experience will be preserved;
• Work can continue on improving the financial and operational performance of the NSC while the long term strategy is developed;
• There will be a degree of certainty for end users which will enable them to make plans for the immediate future. There have been recent signs of progress in attracting major events to the NSC in terms of Volleyball, Gymnastics and regional athletics and a secure position at least until 2020 will enable that progress to be built on and;
• To provide time to work on the specification. .
1.10 GLL currently manage the Aquatics Centre as well as the Copperbox in Queen Elizabeth Olympic Park on behalf of LLDC
1.11 Discussions with GLL have been based on the contract being extended on similar terms to those currently in place, with GLAP’s contribution in respect of VAT and London Living Wage to be adjusted to reflect current levels of expenditure.
1.12 The proposal is therefore to extend the current contract with GLL for 2 + 1 years, providing continuity of service at least until 31st March 2020. In the event that substantial progress has been made to implement a revised operating model but it does not prove possible to do so before 31st March 2020, the contract will allow for a further extension of up to an additional twelve months to allow for the revised model to be implemented effectively.
The primary objective is to extend the current GLL contract for 2+1 years, to provide continuity of service while GLAP develops and implements, a long term strategy for the future of the NSC
Extending the GLL contract for 2+1 years will ensure that this major sporting facility remains open and fully operational, while a long term plan for the future of the NSC is developed.
5.1 This decision requests approval to extend the contract with GLL for the provision of leisure management services to GLAP for 2+1 years from the 1 April 2018. The previous extension for this contract was granted under MD1602, expiring 31 March 2018.
5.2 The contract is to be extended on similar terms, whereby GLAP is not incurring any management fees and reflecting appropriate adjustments of GLAP’s contribution towards VAT and meeting the Mayor’s London Living Wage commitment for the years in question.
6.1 Officers have indicated in this report that:
6.1.1 the decisions requested of the Mayor fall within the statutory powers of the Authority to do such things which may be considered facilitative of or conducive or incidental to the discharge of its principal functions.
6.1.2 in formulating the proposals in respect of which a decision is sought officers have complied with the Authority’s related statutory duties to:
(a) pay due regard to the principle that there should be equality of opportunity for all people;
(b) consider how the proposals will promote the improvement of health of persons, health inequalities between persons and to contribute towards the achievement of sustainable development in the United Kingdom; and
(c) consider consulting with appropriate bodies.
6.3 Officers must ensure that the GLL contract is varied in accordance with the relevant provisions of the contract and all necessary variation documentation is put in place before the commencement of the extended contract period.
6.4 See part 2 for other legal considerations
Document contract extension
Communicate contract extension to major sporting bodies and end users