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Impact of the COVID-19 Outbreak on Sport June 2020

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Impact of the COVID-19 Outbreak on Sport June 2020 Welsh Parliament Culture, Welsh Language and Communications Committee Impact of the COVID-19 outbreak on sport June 2020 1. Background The Culture, Welsh Language and Communications Committee is looking into the impact of the COVID-19 outbreak on areas within its remit. For the purposes of this inquiry, the Committee is also looking at sport at both grassroots and elite levels. Dafydd Elis-Thomas MS, the Deputy Minister for Culture, Sport and Tourism and Jason Thomas, Director Culture, Sport and Tourism, Welsh Government provided oral evidence to the Committee on 12 May. The following witnesses provided oral evidence to the Committee on 11 June: . Brian Davies, Sport Wales; . Dr Kelly Mackintosh, Swansea University; . Huw Thomas, Welsh Local Government Association (WLGA); . Jonathan Ford, Football Association of Wales (FAW); . Gareth Davies, Welsh Rugby Union (WRU); and . Marcus Kingwell, EMD UK: The National Governing Body for Group Exercise. A transcript of the meeting can be viewed on the Committee’s website. Members also considered written evidence. A list is provided in Annex A. www.senedd.wales 2. Immediate impact on sport and support for the sector 1. The WRU described the impact of COVID-19 on sport as ‘catastrophic’.1 Sport Wales said that the impact has been ‘immediate and significant’ for the sports that were in the middle of, or about to start, their season.2 Jason Thomas, Director Culture Sport and Tourism, Welsh Government told the Committee that ‘small clubs, large clubs are all closed and everybody's looking for support to help them through this’.3 2. Sport Wales told the Committee that engagement with the Welsh Government has ‘increased significantly’4 since the COVID-19 outbreak and that it has been a good example of the ‘increased collaboration that’s been required during this period’.5 Similarly the WRU said that a silver lining of the pandemic has been ‘much improved communication’6 and the WLGA described the engagement as ‘exemplary’.7 3. The Committee heard that the FAW did have some concerns at the beginning of the pandemic that most decisions are made at Welsh Government Cabinet meetings and that ‘sport isn't necessarily represented directly in that Cabinet with a Sports Minister’:8 ‘So, there were one or two concerns that not necessarily somebody has got, let's say, the back of football or sport at those Cabinet meetings. But we've been reassured that those briefings do happen beforehand.’9 4. Working with the Welsh Government, Sport Wales has repurposed a total of £8.5 million to support sport and physical activity organisations who are negatively 1 CWLC meeting 11 June 2020, para 158 2 CWLC meeting 11 June 2020, para 43 3 CWLC meeting 12 May, para 110 4 CWLC meeting 11 June 2020, para 13 5 CWLC meeting 11 June 2020, para 13 6 CWLC meeting 11 June 2020, para 138 7 CWLC meeting 11 June 2020, para 15 8 CWLC meeting 11 June 2020, para 136 9 CWLC meeting 11 June 2020, para 136 1 impacted by the pandemic and also help them ‘to thrive and support people in Wales to enjoy being active in the future’.10 5. Sport Wales is running a £550,000 Emergency Relief Fund for not-for-profit community sport. As at 22 June 2020, support has been provided to 295 clubs in Wales, totalling £543,944. Sport Wales explained that it had repurposed funding from existing budgets to create the fund: ‘The truth is that will have an impact, if we spend all that on recovery out of this situation, for when we have recovered out of it, because it will no longer be available to us, because we'll have spent it.’11 6. The WRU has provided an additional £1,000 to each of its member clubs. 7. The Committee heard that not all parts of the sector have had access to financial support. Sport Wales told the Committee that some of the self- employed people, for example instructors, may have fallen through the gaps.12 EMD UK explained that many self-employed group exercise instructors have found the UK Government’s Self-Employed Income Support Scheme difficult to access for various reasons: ‘Group exercise might be a part-time employment for them rather than full time. They might have come into it in the last 12 months, in which case they don't have the financial records to prove the case of their previous earnings and profits, or they might be running it through a microbusiness, in other words, a limited company, and are therefore not allowed. So there are a great many self-employed people here of various types who have not been able to claim anything…because they're not entitled to any financial support, and you have to wonder whether they will still be here again when they're allowed to start teaching classes in their community settings.’13 8. The Mackintosh Lawn Tennis Club also commented on this problem, writing: ‘The UK Government and LTA (Lawn Tennis Association) have provided financial support to self-employed coaches through Self-Employment Grant scheme, and Coaches Grant scheme - however, this amount is 10 Sport Wales written evidence 11 CWLC meeting 11 June 2020, para 55 12 CWLC meeting 11 June 2020, para 56 13 CWLC meeting 11 June 2020, para 164 2 significantly less than coaches would usually earn. The UK Government Self-Employment Grant scheme is calculated based on average profits from the last 3 years - whilst tennis coaches work all-year round, the vast majority of income is generated from March-August, therefore the Grant Scheme provides an unfair calculation for seasonal workers.’14 9. The Committee heard that leisure trusts are also facing significant financial concerns. Welsh trusts are continuing to incur an average of around £222,000 in monthly costs (excluding costs recovered through the Job Retention Scheme and any negotiated expenditure reductions), while losing an average of £420,000 of income per month.15 According to Community Leisure UK (Wales): ‘There are significant concerns around the financial viability after the Coronavirus Job Retention Scheme ends in October with 70% of Welsh trusts reaching an “insecure” position in the next 6-9 months. Alarmingly, within nine to twelve months from now, 90% of Welsh trusts will have become “non viable” or be in an “insecure” position.’16 10. Sport Wales said that its support funds ‘can only help; they’re not going to solve the issue’.17 The WLGA was also concerned about the economic impact on leisure trusts, stating that: ‘…the real fear is…even after the lockdown eases, people won't immediately return in the numbers they once did to these kinds of indoor sporting activities. From a local government perspective, therefore, we are certainly looking very closely at a position where leisure centres have been placed into trusts or other arrangements, with an anticipation that there will be some calls for these services to return back to the authority, with the incumbent costs that come with that. Likewise, if the authority is still delivering services in-house, those authorities will be taking direct financial hits. So, it is a challenge that, whatever your position is in the 22 authorities—it's something that will impact us all, I think.’18 11. The WLGA also said that the fact that some leisure centres are being used as treatment centres for COVID-19, and that those arrangements may continue after 14 Mackintosh Lawn Tennis Club written evidence 15 Community Leisure UK (Wales) written evidence 16 Community Leisure UK (Wales) written evidence 17 CWLC meeting 11 June 2020, para 57 18 CWLC meeting 11 June 2020, para 49 3 leisure centres are allowed to reopen, needs to be ‘factored in and considered as part of any recovery plan’.19 Community Leisure UK (Wales) wrote: ‘Some of these repurposed leisure centres have already been told they will not return to their original purpose before the end of this calendar year. This significantly limits organisation’s possibilities to operate and generate income, as in some cases the repurposed sites account for 40% of the usual income.’20 12. The Committee also heard that there will be significant economic impact at club level, including football and rugby. The FAW explained that domestic football in Wales is very reliant on match-day and clubhouse income and without it ‘there will be some definite economic impacts that they will have to reassess their business models to understand how it works’.21 The WLGA said the fact that a significant amount of sport clubs’ income comes from social activity, rather than sport activity, means that the easing of the lockdown will not ‘necessarily solve the financial challenges that may be governed by a different set of lockdown guidance’.22 13. In terms of high-level football, the FAW said that money from the broadcasting market should enable it to survive.23 Professional rugby on the other hand is ‘taking and will take a huge hit’24 according to the WRU. The Wales v Scotland Six Nations match at Cardiff’s Principality Stadium was postponed by the WRU the day before it was due to take place on 14 March, resulting in the governing body taking a ‘£10 million hit’.25 14. The Committee heard that grassroots level sport is likely to be hardest hit. The FAW said that there are ‘massive financial difficulties ahead’26 and that there would probably be ‘fewer clubs at the end of it’.27 The WRU explained: ‘In the short term, if you're looking over the next six months, then a very, very high percentage of our community clubs have reserves to survive 19 CWLC meeting 11 June 2020, para 31 20 Community Leisure UK (Wales) written evidence 21 CWLC meeting 11 June 2020, para 154 22 CWLC meeting 11 June 2020, para 59 23 CWLC meeting 11 June 2020, para 153 24 CWLC meeting 11 June 2020, para 161 25 CWLC meeting 11 June 2020, para 158 26 CWLC meeting 11 June 2020, para 155 27 CWLC meeting 11 June 2020, para 176 4 that period.
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