Glasgow Life will continue to run culture and leisure services in the city, despite concerns it was “exposed by the pandemic”.
Income from leisure facilities and concert venues was wiped out when covid lockdowns forced buildings to close, with extra council funding helping the arms-length organisation to continue operating.
It needs to be on a “sustainable financial footing” by March next year when the council’s covid support ends, and a recovery plan includes using early retirements and voluntary redundancy.
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After a review, councillors have agreed Glasgow Life should “remain as a charitable company to deliver culture and leisure services on behalf of the council”.
But Glasgow Greens raised concerns over the current model as, when income dropped during the pandemic, libraries and community centres couldn’t stay open.
A council official said there were financial benefits from Glasgow Life’s model, including £16m in rates relief and opportunities to seek funding which only charities can receive.
Cllr Jon Molyneux, Greens co-leader, said: “Glasgow Life had arguably been “a victim of its success in terms of earned income”. “We couldn’t keep our libraries and community centres open because we lost commercial revenues from leisure facilities and concert venues.
“We would want to avoid a situation where particularly libraries and community facilities rely on earned income from other parts of the business in order to have their doors open.”
His amendment, which was accepted, said the “recommendation to retain the status quo is heavily based on the financial case, and in particular on the council’s potential liability for non-domestic rates if services were brought back in-house”.
It agreed that the council will now write to the Scottish Government asking it to “consider these issues in the urgent and necessary reform of local government funding”.
Cllr Molyneux added: “If there were more financial levers available to the council we might choose to do different things. It certainly feels like our hands are largely tied, I think due to the current financial situation.”
The amendment also brought forward the next review of Glasgow Life from 2027 to 2025/26.
The council is Glasgow Life’s primary funder via a service fee and provided additional covid funding, which comes to an end in March next year.
“Whilst income has been recovering well over the last two years, with further recovery expected, Glasgow Life will still need to reduce its expenditure to achieve this financial stability,” officials reported.
“This includes a workforce plan which will include the use of redeployment and early retirement/voluntary redundancy.”
Unions have opposed arms-length organisations and, the report added, have a “strong preference” for staff and services to be transferred to the council.
However, officials claimed the “financial challenges associated with this option are deemed untenable and would have a material and severely detrimental impact in relation to council budget”.
Cllr Annette Christie, the Glasgow Life chairwoman, said she was pleased the review noted the “great success” of Glasgow Life “as a delivery model”.
“The opportunities and the benefits that Glasgow Life brings to the city as a charity are much more than just the NDR [non-domestic rates] relief,” she said.
“A recent example of this would be the great success of fundraising for the refurbishment of the Burrell Collection, where over £8m was raised, and that was outwith the funding that the charity received from the National Heritage Lottery fund, Scottish Government and UK Government contributions.”
Glasgow Labour leader, Cllr George Redmond, said covid “did expose too many of our core services within Glasgow Life are relying on commercial income”.
The review also considered the impact of the People Make Glasgow Communities programme, where community groups have been given the chance to run venues, and the equal pay deal which included selling, and then leasing back, several Glasgow Life venues.
An action plan has been developed which includes lobbying the Scottish Government for core funding for the city’s “assets of national significance including museums and sporting facilities”.
It also involves cutting the number of board members from 14 to 12, a skills review to ensure members have relevant experience and induction training.
The council and Glasgow Life will mutually agree performance measures and targets annually and a survey of the condition of the arms-length organisation’s buildings will be carried out to “identify areas of the city which are either over or under provided for”.
Utility costs and income generation will also be reviewed.
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