URL: https://democracy.thanet.gov.uk/ieDecisionDetails.aspx?ID=5535

Decision Maker: Director of Corporate Services & S151 Officer

Outcome: Recommendations Approved

Is Key Decision?: No

Is Callable In?: No

Purpose: The alternative considered was to maintain the existing arrangements (i.e., take no action). This was rejected because it would have undermined the intended restructuring of agreements with Your Leisure (YL), resulting in the continuation of the current management fee and incurring a greater financial burden on Thanet District Council (TDC), as identified in the 2021 report to Cabinet.

Content: The alternative considered was to maintain the existing arrangements (i.e., take no action). This was rejected because it would have undermined the intended restructuring of agreements with Your Leisure (YL), resulting in the continuation of the current management fee and incurring a greater financial burden on Thanet District Council (TDC), as identified in the 2021 report to Cabinet. The Director of Corporate Services and Section 151 Officer agrees, under delegated authority, to the novation and refinancing of the facilities agreements attached to Hartsdown and Ramsgate Leisure Centres.   Following a Cabinet report on Your Leisure's position in January 2021, which addressed the impact of COVID-19 and the need to rationalise existing obligations (including loans/facilities and pension commitments), a review of these arrangements was initiated.   This report specifically discussed the issues with existing obligations placed on YL pertaining to ongoing loans/facilities agreements and pension obligations and a need to review these arrangements in order to rationalise the agreements moving forward.   Working with Your Leisure (YL), Lloyds Bank (the lender), and external advisors, the most appropriate route identified was novation followed by refinancing. This treasury management action secures a more favourable rate of interest over a more realistic term. Crucially, it allows Thanet District Council (TDC) to remove the management fee from YL and replace it with a lower-value cost of borrowing, resulting in ongoing savings for the Council.   The Director of Corporate Services and Section 151 Officer is authorised to approve these transactions under the Scheme of Delegations.   This decision is linked to the September 2022 Cabinet approval, which granted the required delegations to facilitate the overall restructuring of the agreements, specifically including:   1.To agree to the surrender of the current lease in its totality, and regrant two new  independent leases for Hartsdown Leisure Centre and Ramsgate Leisure Centre;   2. To give delegated authority to the Interim Director of Property, to enter into the relevant Agreement(s) for new leases with Your Leisure on terms to be agreed;    3. To give delegated authority to the Acting Director of Finance and Operations to negotiate the sharing agreement with Your Leisure for the wider provision of services provided through Your Leisure;    4. To give delegated authority to the Acting Director of Finance and Operations to negotiate the service concession agreement with Your Leisure for the wider provision of Foreshore related activities;    5. To give delegated authority to the Interim Head of Legal and Monitoring Officer to sign all documents necessary to give effect to the surrender and subsequent leases.   To ensure the revised Leases were fit for purpose and reasonable in the context of Local Government Reorganisation, an external firm reviewed the agreements and made several accepted recommendations, including a revision to the lease terms.    All of the above actions are effectively completed and new Leases are due to be in place for 01 April 2026.   The alternative considered was to maintain the existing arrangements (i.e., take no action). This was rejected because it would have undermined the intended restructuring of agreements with Your Leisure (YL), resulting in the continuation of the current management fee and incurring a greater financial burden on Thanet District Council (TDC), as identified in the 2021 report to Cabinet.   None

Date of Decision: March 6, 2026