Councillor Chris Meaden introduced a report by the Strategic Director for Families and Wellbeing which highlighted the results of the soft market testing exercise completed in May 2014 which demonstrated interest from specialist golf operators in taking over the management and maintenance of the Wirral golf courses excluding Hoylake Municipal Golf Course.  The market response indicated that it was possible to protect the Council’s requirement for affordable and accessible “pay and play” golf whilst eliminating Council subsidy, which is currently £330k per annum including course maintenance.

The report sought approval to progress to the next stage – which involves a more formal procurement process to secure detailed proposals for the granting of a lease and concession agreement for up to 25 years.  No final decision or commitment is required at this stage.  If approval is given, more detailed engagement with staff, trade unions and other stakeholders will commence. 

Other Councils have found that similar arrangements can eliminate subsidy entirely (and in some cases attract a concession income for the Council).  Liverpool City Council have achieved this recently and the arrangement will generate investment in the courses and facilities whilst protecting affordable pay and play golf for local people. 

The market response to the soft market testing indicated that operators will only be willing to take full trading risk if they manage and maintain the courses and operate the golf concession.  The standards required for course maintenance will be set out in the formal agreements, but clearly the operators will expect to provide high quality in order to achieve the level of usage they will need for the concession to be viable. 

Currently, the Council operates and maintains the following Golf facilities:

·  Arrowe Park Golf Course

·  Hoylake Golf Course (note that this course was excluded from the scope of the market testing)

·  Brackenwood Golf Course

·  Warren Golf Course

·  Wallasey Beach mini golf

·  Arrowe Park pitch and putt, and

·  Kings Parade crazy golf

The provision of golf transferred to the Leisure Services section in February 2014 from the Technical Services Department.

In order to secure the best possible outcome, officers have worked closely with Cheshire West and Chester (CW&C).  This collaborative approach is in line with the agreement reached by both authorities to work more closely together.  By widening the scope for operators to express interest in specific courses, it has been established that economies of scale are likely to apply when groups of courses can be managed together.  That said, the next stage of work will result in specific proposals that may involve one or more operators (if this presents better value).

The current revenue subsidy for Golf course provision is forecasted to be £440,050 in 2014/15.  Income has fallen significantly during the last two years across all areas of golf, and the level of subsidy may well increase in the future as usage declines.  Significant investment is required simply to maintain roundage at current levels.  There is expected to be a £50k minimum increase in golf income this year as a result of re-branding the golf package and additional interest generated by the Open Golf tournament at the Royal Liverpool in July 2014.

For the purposes of the soft market testing exercise, Hoylake Municipal Golf Course was excluded from the process, as it is thought possible that a local solution may prove better value and this option needs to be explored separately in the wider context of golf development in Wirral. 

RESOLVED:

The reasons for the procurement of golf facilities be noted and approved, and that appropriate reporting mechanisms will be put in place, including a final report to be presented to Elected Members before any award is made.  By entering into the next stage of the process, the Council will not be committing themselves to awarding a concession agreement.