CITY COUNCIL Development, Environment and A Leisure Directorate

REPORT TO DATE: 1/09/09

CULTURE ECONOMY AND SUSTAINABLITY SCRUTINY AND POLICY DEVELOPMENT BOARD

ITEM REPORT OF THE DIRECTOR OF CULTURE

Subject: SHEFFIELD INTERNATIONAL VENUES

SUMMARY

To report on the activities and performance of Sheffield International Venues for the period 1 April 2008 to 31 March 2009.

RECOMMENDATIONS:

The Board is recommended to note the report and agree to a further report on SCT/SIV performance in twelve months time.

FINANCIAL IMPLICATIONS NO CLEARED BY Laura Pattman

EQUALITY IMPACT ASSESSMENT CARRIED PARAGRAPHS OUT? YES/NO CLEARED BY John Hendley

BACKGROUND PAPERS

CONTACT POINT FOR ACCESS David Macpherson TEL NO. 2053149

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REPORT TO CULTURE, ECONOMY & SUSTAINABILITY SCRUTINY AND POLICY DEVELOPMENT BOARD

1st September 2009

SHEFFIELD CITY TRUST AND SHEFFIELD INTERNATIONAL VENUES (SCT, SIV)

1. PURPOSE OF THE REPORT

1.1 To review the recent past performance of and Sheffield International Venues and to outline the challenges faced in the near future.

1.2 This report does not cover the performance of which is considered in another report to be presented at the meeting.

2. BACKGROUND

2.1 Sheffield City Trust is a charitable company which operates the following venues via its trading arm Sheffield International Venues:-

• International Sports Centre • and Woodbourn Athletics Centre • Hillsborough Leisure Centre • Concord Sports Centre • Beauchief Golf Course • Golf Course • Tinsley Park Golf Course (Management Agreement) • Woodburn Road Athletics track (Management Agreement) • IceSheffield • Sheffield City Hall • The English Institute of Sport – under contract with and funded by Sport England

In addition, SIV sub-contracts the management of the to a company called Live Nation.

SCT also has a grant giving role in support of community sports and arts projects in the city.

2.2 Sheffield City Trust is governed by a Board of up to 16 trustees, half of whom are nominated by Members of Parliament representing constituencies situated within or partly within the boundaries of the City of Sheffield, and half of whom are nominated by the Sheffield Chamber of Commerce and Industry.

2.3 The City Council has long-term funding and management agreements with SCT and SIV. As a result, an officer of the City Council is invited to attend as an observer at both the SCT and SIV Boards. In addition, the City Council has a nominee director on the SIV Board and a councillor observer at the SCT Board.

2.4 It is important to note that SCT/SIV play a major part in both the city’s physical activity strategy – aiming to get more people, more active – as well as the city’s sporting agenda in terms of sporting excellence, events and income generation. Sports facilities – particularly swimming pools – are key settings whereby the city is striving to increase activity levels. They rank alongside parks, schools and foot/cycle ways in their importance.

2.5 During the year SIV were given permission to set up a trading subsidiary to seek contracts outside the City that could generate surpluses for re- investment in the Sheffield facilities. To date the company, SIV Enterprises Ltd (SEL) has won two contracts, Staveley Healthy Living Centre Café (purely a catering contract) and Tapton Park Golf Course in Chesterfield.

3. FINANCIAL OVERVIEW

3.1 SCT/SIV has three main income sources – customer income (from a mix of community and commercial activity); profit share from the Sheffield Arena and annual grant support from the City Council. Any income from SEL would be re-invested in the facilities and would therefore have a neutral impact on the overall accounts, however at present SEL is still in a development phase and as such is not yet in a position to generate surpluses.

3.2 The level of grant support from the City Council in 2009/10 is in the order of £5.619m – including support for Sheffield City Hall and payment of management agreement charges for Tinsley Park Golf Course and Woodburn Road athletics Stadium.

4. VISIT NUMBERS

4.1 The table below summarises the total visit numbers to SIV facilities in recent years, including the target set for visit levels in 2008/09. The figures include all types of visitor from sports participation, events and commercial usage such as seminars and functions.

4.2 The key points to note within the figures are as follows:- a) The dip in expected visits to Concord is a direct result of a planned closure to refurbish the swimming pool in 2009/10. b) The high point for Don Valley in 2006/07 was created by hosting two large pop concerts, the target reflects the United football attendances but was set before the U” concert was announced. This may result in a better out-turn than forecast. c) Although the 08/09 figures proved that the new Gym was able to boost attendances, the Credit Crunch impact was taken into account in setting the targets for 09/10. It would appear that these may have been set on the pessimistic side as current performance is ahead of target as at month three. d) Hillsborough LC continues to perform well and is ahead of target at month three however the impact of the revamped gym has worn off and it is not as far ahead of target as Ponds Forge at this time. e) EISS had an exceptionally good year in 08/09 and continues to show steady growth. The target for 09/10 was set in the knowledge that, unlike last year, there was not the run up to the Olympics this year and therefore likely to be less activity. Hopefully in the next couple of years with training camps etc leading up to 2012 this facility will see a significant rise in attendances. f) Ice Sheffield exceeded expectations in 08/09 and while the target has been set against the backdrop of relatively stable figures in 06/07 and 07/08 it would appear from the month three figures this year that the potential exists for an even higher performance this year. g) In terms of golf courses, while in the last report we were expecting the targets for 08/09 to be exceeded, the bad summer last year resulted in a disappointing year where none of the courses achieved target. At month three this year, only Tinsley was achieving target and since then the weather has not been kind to golfers. h) Sheffield Arena – 08/09 continued the good run of performances from the Arena however the targets are always set based on the known dates etc. at a point in time and reasonable expectations beyond that. 09/10 is looking better than forecasts earlier in the year however is still not forecasted to exceed the 08/09 performance. Looking to the future there is the potential competition from the proposed new Arena in that will impact on the business performance in three years time. The city has commissioned an independent study to fully assess the potential impact of a new arena in Leeds and how the Sheffield Arena will best respond if the new arena goes ahead.

4.3 In 08/09 the initial target overall was exceeded by just over 10%, the overall the combined target visit levels to the venues in 09/10 is expected to be just under 10% lower than the levels achieved in 08/98 (3.514m as opposed to 3.867m) but still higher than the original targets for 08/09. Early indications would suggest that performance might exceed target. Golf is one area of concern where the performance last year was below target and this trend has continued into the current year however the Arena continues to perform well and is expected to exceed its initial targets.

VENUE YEAR TOTAL VISITS Concord SC 09/10 Target 430,595 08/09 475,597 07/08 490,326 06/07 441,423 05/06 442,253 04/05 298,782 03/04 312,433 02/03 317,526

Don Valley/Woodbourn Stadiums 09/10 Target 197,738 08/09 305,795 07/08 181,745 06/07 256,945 05/06 209,327 04/05 125,612 03/04 214,702 02/03 228,708

Ponds Forge ISC 09/10 Target 789,750 08/09 808,014 07/08 758,551 06/07 896,518 05/06 970,940 04/05 942,754 03/04 1,031,241 02/03 1,101,373

Hillsborough LC 09/10 Target 730,462 08/09 823,803 07/08 705,624 06/07 647,737 05/06 679,597 04/05 585,449 03/04 656,591 02/03 505,569

EISS 08/09 Target 219,529 08/09 246,689 07/08 215,472 06/07 196,034 05/06 179,682

Ice Sheffield 09/010 Target 383,496 08/09 395,497 07/08 382,262 06/07 381,899 05/06 336,333 04/05 275,744

Beauchief Golf Course 09/10 Target 35,478 08/09 31,382 07/08 38,738 06/07 31,787 05/6 35528 04/5 35615 03/4 39736 02/3 35878

Birley Golf Course 09/10 Target 37,811 08/09 34,365 07/08 36,699 06/07 34,765 05/6 35409 04/5 35921 03/4 38903 02/3 34592

Tinsley Golf Course 09/10 Target 42,024 08/09 38,143 07/08 40,092 06/07 38,146 05/6 40357 04/5 40064 03/4 43377 02/3 37668

Sheffield Arena 09/10 Target 647,958 08/09 708,129 07/08 693,966 06/07 642,569 05/06 548,775 04/05 596,473 03/04 711,817

5. OTHER PERFORMANCE MEASURES

5.1 The City Council benchmarks the performance of SIV venues against similar venues across the country, the 08/09 results are due out in November 09. The comments below are based on the 07/08 results. SIV performance is assessed against a wide range of indicators, however, there are three key indicators which give a representative measure of wider performance:- a) operational recovery – this measures the percentage contribution of income to total expenditure (excluding debt charges). In the case of SIV, its facilities are above average with Hillsborough in particularly being ranked highly at the third out of its family group of 18 facilities. b) customer spend per head – this measures the level of spend by customers. SIV facilities are above average on this indicator with most in the top 25% when compared with other facilities. This reflects a combination of prices which are relatively high compared to some local authorities (though less expensive than commercial providers); the importance of ‘high spend’ commercial activities such as corporate functions and the company’s success in generating secondary spend from customers on catering etc c) usage per opening hour – this measures occupancy levels. Again SIV scores well, with Ponds Forge in particular scoring the highest against other similar facilities

5.2 The performance of SIV in terms of its ability to attract low income and socially disadvantaged groups is also measured and compared with other facilities. The general picture shows the venues are relatively successful in attracting female users, older people, black and ethnic minorities and people with disabilities. The main focus of activity around the low income groups is from Concord Sports Centre where Slice Card is promoted and there are additional discounted sessions and a strong link with the health agenda through the GP referral process. SIV’s Fitness Unlimited membership package also offers extremely good value for money and is pitched at the ‘budget’ end of the fitness/sports membership market.

5.3 The city also has a measure of overall resident satisfaction with sports facilities – of which SIV venues are a major part. The latest satisfaction score from the Active People’s Survey is 73.2%, which is higher than the national and regional average.

6. RECENT SUCCESSES

6.1 Over the previous year, SCT/SIV has enjoyed a number of notable successes including:- a) The strong performance of the Arena with several head line artists appearing in 08/09 and the very successful Strictly Come Dancing and Disney on Ice shows. b) The performance of the new gym at Ponds Forge where memberships exceeded the target by more than 50% c) All venues increased their income against the previous year. Sales up 10.3% over the previous year and exceeded £24M d) SIV had over 15,000 Fitness Unlimited members at the end of the year. A record. Participation in sports activities increased by 13% over the previous year. e) Catering income exceeded £4 million f) SIV generated over 75,000 overnight stays from our sporting venues. This represents 12% of Sheffield hotels occupancy. g) Hillsborough won the UK Fitness Industry FLAME award for a record fourth year in succession City Hall won Yorkshire Business Tourism venue of the year.

7. CHALLENGES AHEAD

7.1 SCT/SIV faces the same challenges as many other public sector or publicly funded sports and leisure operators. These include:- a) increasing costs – many of which are difficult to control such as energy and insurance b) a growing need for reinvestment in the facility stock c) ever-rising expectations of customers for quality and value for money d) expanding competition from other swim and fitness providers in the city e) rising unemployment, economic recession, reduced disposable income. f) seek greater usage from those groups which are currently the least active in sport and physical activity. For example, people from low income families g) reduction in support from other agencies for major events in Sheffield. h) to obtain and operate profitably additional contracts through SEL

7.2 In response to these challenges, the company and the City Council are working together to identify options for both greater efficiency and business growth. The most prominent of which are:- a) the undertaking of feasibility studies funded by Yorkshire Forward for the House of Sport project and the enhancement of facilities at EISS. b) an on-going review of all operating and staffing efficiencies c) working with the City Council to exploit business opportunities arising out of the 2012 Games in terms of new events, training/holding games and relocation of sports governing bodies. SIV is also playing a central role in the city’s bid to become a candidate host city for the 2012 World Cup with their interest primarily driven the potential for fan park developments focused around the Don Valley complex of facilities. d) the maximisation of profit from SEL from contracts elsewhere in the UK. Closing the SYPS final salary pension scheme to new members from 1 st Sept.

8. FINANCIAL IMPLICATIONS

8.1 There are no direct financial implications arising from this report.

9. EQUAL OPPORTUNITIES IMPLICATIONS

9.1 The City Council works closely with SCT/SIV to ensure that access and take up is maximised by traditionally low participation groups. The core purpose of SCT is provide healthy recreational and sporting activity to a wide cross- section of the population. This is reflected in the company’s core mission ‘excellence for all’ and in the ‘budget’ level membership scheme, together with the operation of the city’s Slice Card discount scheme.

10. HUMAN RIGHTS IMPLICATIONS

10.1 There are no Human Rights implications arising from this report.

11. ENVIRONMENTAL SUSTAINABILITY

11.1 SIV takes the environmental effect of its activities very seriously and has reduced energy consumption levels at all venues with a series of energy action plans. Actions in the plans range from simple staff awareness campaigns to significant investment in plant to increase efficiency. SIV is currently in the process of qualifying for ISO 14001 by introducing new waste management procedures

12. COMMUNITY SAFETY IMPLICATIONS

12.1 There are no Community Safety implications from this report.

13. AREA PANEL IMPLICATIONS

13.1 There are no Area Panel implications from this report.

14. CONCLUSIONS

14.1 The City Trust and SIV continue to perform well in an increasingly competitive and challenging environment. Whilst the financial performance of the company is paramount, it is also important to recognise the major contribution the facilities play in increasing levels of physical activity, supporting the development of sporting excellence, hosting major events and improving the city’s overall image and economic performance.

There are, however, significant financial and market challenges ahead. The City Council will continue to work closely with SCT/SIV in preparing for these and in ensuring that in the run up to the 2012 Olympics the opportunities to capitalise on training camps and on the higher profile that sport will have, is grasped.

15. RECOMMENDATION

15.1 The Board is recommended to note the report and agree to a further report on SCT/SIV performance in twelve months time.

Paul Billington Director of Culture Development, Environment & Leisure September 2009