Robin Strang: Rates U-turn highlights vital role of trusts

It is no exaggeration to state that the F'inance Secretary Derek Mackay's decision on Tuesday to drop the Barclay Review's recommendation to remove rates relief from charitable trusts saved several hundred of Scotland's leisure centres, swimming pools, public libraries and town and community halls from closing their doors for good in 2018-19.
Without rates relief swimming would be unaffordable for mostWithout rates relief swimming would be unaffordable for most
Without rates relief swimming would be unaffordable for most

There were fundamental flaws in Barclay’s thinking that brought this threat to the horizon. One was the assertion that these charitable trusts were council “tax avoidance vehicles” unfairly benefiting from relief, when the reality is that trusts were created as an innovative measure to protect sport, leisure and cultural facilities and services facing closure due to increasing financial pressure on local government budgets.

Charitable trusts benefit from rates relief so by transferring facilities to a trust councils saved millions of pounds – money that was used not only to save facilities from closure, but that led to increased income and more local people using facilities and being employed within sport, leisure and culture.

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That is the simple story of trust evolution across Scotland, since Perth and Kinross pioneered the move in 1965. The rates saving was a catalyst for change but it was only one part of the rationale. A charitable trust brings with it a community board of local people with key skills, expertise and entrepreneurial approaches, who make decisions and spend its money based on community need rather political desires.

Trusts have evolved from their council roots and with over 16,000 staff, an annual combined budget of more than £400m and the ability to source external funding – trusts have brought in over £200m. It is, ironically, the one body in Scotland with the greatest potential to kick-start the Scottish Government’s much-needed preventative health agenda.

In fact, Glasgow Life has stopped running programmes that were mostly benefiting people in affluent areas with exercise options, and switched funding to Govan, Drumchapel and other areas where they believe the need is greater.

Trusts are now focusing serious attention on the inactive in communities, with GP Referral and falls prevention schemes, staff in hospitals, care homes and mental health units, and daily work around obesity, cardiac and stroke rehab, cancer recovery, mid and long-term illnesses, homelessness, anti-social behaviour and educational attainment, with a variety of partners.

There is space for private gym operators and trusts, one group catering for the mass market and generating profits for directors and shareholders, while the other uses every penny of income to sustain community facilities and services that are unprofitable on their own, but which remain valuable social lifelines, particularly in deprived and rural communities.

Even busy public swimming pools do not make profits. Through trusts, the taxpayer subsidises every swim on average by £3-£5. The subsidy in some aged pools is almost £10 per person, so if trusts lost rates relief and operated privately that swim would cost around £12 per adult; eight lessons for a child there would rise from £30 to £70. Unaffordable to most. So the facility, its staff and a vital resource would go, and a wealth of physical and mental health activity is lost.

The Cabinet Secretary, and his colleagues, understood this and recognised the need to support investment in these community services. There has also been a clear message received by SPORTA and VOCAL that we need to better evidence, publicise and celebrate our work to inspire more people to be active in sport, leisure and culture.

The wider challenges concerning health, wellbeing and inequality are not going away, and will be compounded by an older population forecast to increase by over 100 percent in the next 20 years.

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The future remains uncertain. Investment in Scotland’s sport, leisure and culture services is declining every year and one council chief executive warned this month that council funding could fall to zero by 2020. So trusts are having to think differently. Without them, many pools, leisure centres and libraries would have been mothballed years ago. However, as they look to new partners, including NHS Scotland, trusts are well placed at the heart of our communities to support and drive forward the government’s vision in areas such as health and wellbeing, educational attainment and economic development.

Robin Strang is chairman of SPORTA Scotland