82% of Charitable Trusts in Wales are at Risk

Published on: November 24th 2022

Full reports can be found here. There are also press releases for England and Scotland

EIGHTY-TWO per cent of Charitable Trusts in Wales are at risk, ranging from those that are in crisis now to those that can see the crisis point on the horizon.

That’s the stark warning from Charitable Trust members’ association Community Leisure UK (CLUK), who said today that the number of trusts in crisis will only grow in the coming months as more and more trusts across the UK head into crisis and take difficult decisions to close facilities and services.

CLUK members operate pools, gyms, leisure centres, libraries, theatres and sports halls and are calling for the Welsh Government and UK Government to support them through an extension of the energy price cap to cover charitable leisure and culture services.

Charitable Trusts working in eight Local Authority areas said they are currently reviewing what they are able to deliver with the potential for closures and/or service reductions. Leisure trusts are contracted to deliver public leisure in 11 local authority areas in Wales. They manage libraries in 4 local authority areas.

Closures have already been announced by some Trusts in England, including Freedom Leisure, who has temporarily closed the swimming pool at Rye Sports Centre, East Sussex to combat rising costs, while Richmondshire Leisure Trust says they can no longer run Colburn Leisure Centre, North Yorkshire due to significant rises in operating costs.

In October, Freedom Leisure said the cost of running swimming pools at 19 of its Welsh centres had risen from £8m a year to £24m.

Community Leisure UK said their latest survey of members across the UK showed a “first wave” of closures was inevitable, with more to follow as those at risk entered into crises.

Phil Rumbelow, Chair of Community Leisure UK, said: “82% of our members in Wales are at risk, ranging from those that are in crisis now to those that can see the crisis point on the horizon.

“Many are now making tough decisions, including reducing operations and implementing recruitment freezes. This is the first wave of what is expected to be a long period of uncertainty and crises for our members due to rising energy prices, the cost of living crisis and uncertainty around local government budgets.

“April and October 2023 are cited as critical points for members due to energy contracts ending, increases in staff wages for the new financial year and local authority funding decisions.”

“Charitable Trusts make a valuable contribution to helping improve the health and wellbeing of communities. The Government must recognise them as a vulnerable sector, and we encourage local authority partners to be more flexible with their contracts.”

The survey also found: 

  • Trusts in crises, heading towards crisis and at risk, are reviewing what they are able to deliver under the current financial climate with the potential for closures and/or service reductions.
  • The majority of Trusts in Wales (82%) will run a deficit budget by the end of this financial year. 
  • 55% of Charitable Trusts in Wales report minimum or no reserves after supporting spiralling costs due to the cost-of-living crisis.
  • Trusts have highlighted four underlying challenges that affect their financial position: changed income levels from customers using their facilities; continued uncertainty around local government budgets; increased costs in utilities; and investment in pay awards for staff.
  • Staff budgets for Charitable Trusts have more than doubled since September 2021 due to increased staffing costs due the need to be competitive with wages to recruit and retain staff as well as increases to the national minimum wage and National Living Wage.
  • Four trusts are now considering or implementing recruitment freezes.

Trusts across Wales have already enacted many mitigating measures to try and offset the increase in their outgoings, including raising prices and being more energy efficient.

Steve Ward, Chief Executive at Newport Live and Director for Wales on the Community Leisure UK Board, added: “There is an urgent need to support public leisure and culture to ensure that these services are protected and able to continue their vital work supporting the health and wellbeing of communities across Wales. They are no longer sustainable, and the situation will only get worse.”

Community Leisure UK is urging the Welsh Government to:   

  • Urge the UK Government to recognise the public leisure and culture sectors as vulnerable sectors and to commit to an extension of the energy price cap to cover charitable leisure and culture services;
  • Commit to an increase in revenue funding to local authorities with a directive to support preventative wellbeing services;
  • Provide additional capital funding for energy projects through the Welsh Government’s Energy Service and Salix funding that is accessible to leisure and culture trusts.