Thousands of UK leisure and fitness facilities could close permanently, as operators struggle to deal with the impact of the COVID-19 lockdown.
According to industry body, ukactive, there’s mounting evidence that organisations are struggling to access loan support and are being crippled by ongoing utility fees, delayed furloughing funds and failed insurance claims. Some operators also face threats of eviction.
The evidence, obtained by ukactive in consultation with leaders from the nation’s major operators, show that – without immediate relief from the increasing financial burdens – an estimated 2,800 facilities could cease trading by the middle of June 2020. This would translate to up to 100,000 job losses across the UK.
Some operators warn they will only remain in business for another five weeks, due to the crippling combination of zero income and outstanding rental and overhead fees.
In response to the findings, ukactive has called on the government to save the physical activity sector by making financial support available immediately.
The body has urged the following steps to be taken urgently:
• Provide faster access to loan support, ensuring that banks move quickly and remove the barriers that are preventing fitness and leisure operators from reaching it now, when they need it most.
• Provide earlier access to funding within the Coronavirus Job Retention Scheme, making sure it is available in April to save up to 100,000 jobs by allowing organisations to furlough staff rather than make redundancies.
• Reduce the pressure from banks on landlords so that they can better support tenants from the physical activity sector, by removing the threat of winding up orders, Commercial Rent Arrears Recovery and statutory demand notices which threaten court action if rent is not paid within 21 days.
• Direct Local Authorities to provide flexibility and support in their contractual relationships with public leisure operators and trusts, as set out in the Government guidance published last month.
• Provide relief from utilities and wider business payments by removing these financial pressures.
Ensure that insurers abide by the content of their agreements and payout when organisations have cover for ‘business closure due to Government action’.
A failure to take these steps will, according to ukactive, result in the loss of crucial services from cities and towns across the UK – such as the closure of hundreds of swimming pools up and down the country and the loss of social prescribing and other community services.
In total, the predicted closures of leisure facilities would result in £2.8bn of social value being lost each year, based on the benefits provided to the population’s health and wellbeing.
“We’re just weeks away from the closure of up to 2,800 fitness and leisure facilities, which play a crucial role in supporting our health, wellbeing and communities,” said Huw Edwards, CEO of ukactive.
“Our nation’s gyms and leisure centres form the fabric of our society, as well as contributing £7.7bn to the economy annually and employing one of the most passionate and dedicated workforces in the world.
“During the last recession, our sector bucked the trend and maintained its growth, providing a much-needed boost to our high streets and communities, so it is important that the Government recognises that contribution.
“If nothing is done and we say goodbye to our gyms and leisure centres it will have a devastating impact on our society when we emerge from the coronavirus pandemic, at the precise time when these facilities will be needed desperately by people.
“If our leisure facilities are lost, it will be incredibly difficult to rebuild them and any recovery will be extremely slow and painful.
“The loss of our gyms and leisure centres would cause irreparable damage for those people who rely on their services most – community groups who find connection within their walls, children who need swimming lessons, and patients who rely on activity prescriptions to manage long-term illness or recovery.
“ukactive requires the Government to make the loans process faster and more accessible, to provide clear guidance to landlords on what they can do to support organisations in the sector, and to provide support on fixed business costs such and rates and utilities.
“The physical activity sector has shown its support for the nation during this crisis, reaching into homes with online workouts and redeploying staff to deliver supplies – now we need to work with Government to make sure it is still there when this is over.”