Decision details

Freedom Leisure Contract Variation

Decision Maker: Cabinet

Decision status: For Determination

Is Key decision?: Yes

Is subject to call in?: No


To consider a contract variation to the Freedom Leisure Contract.




That Cabinet recommend to Council the proposals set out in the Cabinet report to vary the contract with Freedom Leisure to deal with the significant challenges presented by the unforeseen increases in energy costs, achievable via the incorporation of a mechanism for the Council to share the cost of utilities over and above the costs assumed in the bid.




Report to Cabinet and Council




Community, Safety and Wellbeing / Finance and Corporate Services




As set out in report.








The Leader reminded those at the meeting that there was a confidential appendix attached to the report.  It would be necessary to exclude the press and the public and move into a private and confidential session should anyone wish to discuss the contents of the appendix.


The Portfolio Holder for Community, Safety and Wellbeing reported that as good partners he endorsed the contents of the report.


The Strategic Director Corporate Resources and Transformation reported that the Council were being asked to consider a proposal for a contract variation to support Freedom Leisure due to the significant unforeseen energy costs which started to occur in early 2022.


It was highlighted that in some instances global supply issues had pushed up utility costs by as much as 500%.  This hit the leisure industry hard with costs, particularly with the running of swimming pools.  The Government had recognised the severity and significance and had introduced the Energy Bill Relief Scheme.  Despite this, the overall increase in cost for year 2, borne by Freedom Leisure accounted for a utility cost variation of 152% on their budget.


In preparing the contract the proposed variation senior officers had taken expert legal advice, giving due regard to the Public Contract Regulations 2015.  It was considered the variation was allowable.  The Council in its role as contracting authority could not have foreseen the increase in utility costs in the extremity suffered.  The majority of the utility risk and cost would still lay with Freedom Leisure.  The increase does not exceed 50% of the value of the original contract.


It was believed that it was in the interest of New Forest residents to support Freedom Leisure and ensure the contract remained deliverable without a reduction in the service level.  The variation is necessary to protect that position.  Payment would be made from existing budgets.


The Portfolio Holder for Finance and Corporate commented that had the Council not entered into partnership with Freedom Leisure, the liability on the Council would have been 100% of the costs.  Therefore he was supportive of the contract variation.


A non-Cabinet member asked about future of the service and ongoing relationship with Freedom Leisure to ensure residents would be looked after.  The Strategic Director reported that the proposal would protect contract provisions and viability of the leisure service which would be positive for residents.


It was questioned whether any measures were being put in place to protect against utility costs now and in the future, for example with solar panels.  It was noted that the end of life gas boilers had recently been replaced at New Milton Leisure Centre with Air Source Heat Pumps, and similar projects carried out at both Applemore and Ringwood, therefore work to reduce consumption was being carried out.



Reason Key: Impacts Significant Number of People;

Other reasons / organisations consulted



Executive Management Team, relevant Portfolio Holder

Contact: Alan Bethune, Strategic Director of Corporate Resources & Transformation, Section 151 Officer Email:, Pawel Duchnowski, Contract Relationship Officer Email:

Report author: Alan Bethune

Publication date: 08/12/2023

Date of decision: 06/12/2023

Decided at meeting: 06/12/2023 - Cabinet

Accompanying Documents: