Leisure firm running West Devon centres goes bust after years of council support

A company which received hundreds of thousands of pounds from West Devon and South Hams councils to keep leisure centres running in recent years has gone into administration.

Fusion Lifestyle, which operated centres in Tavistock, Okehampton, Kingsbridge, Dartmouth, Ivybridge and Totnes on behalf of the councils, has gone bust after “sustained financial pressures due to rising operational costs, a lack of government funding, and post-pandemic recovery challenges”.

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The councils have awarded a short-term contract to national operator Parkwood Leisure, which runs leisure facilities in Torbay and North Devon, to prevent the immediate closure of the South Hams and West Devon sites.

They said they were working closely with Fusion’s administrator to ensure that the centres, their staff, swim school, fitness classes and memberships continue “without any interruption and transfer seamlessly over to Parkwood”.

Fusion Lifestyle signed a 25-year deal with West Devon Borough Council and South Hams District Council in 2016 to manage their leisure facilities, but has also been operating similar sites for councils across England and Wales.

West Devon Borough Council said it had “repeatedly stepped in” to support Fusion to keep its centres open, but a few weeks ago the company warned that it was likely to enter administration, or possibly liquidation if agreement could not be reached over funding for the period of administration.

As a result, the council had “started looking for alternatives to ensure that the services could transfer as quickly as possible”.

Leader of West Devon Borough Council Mandy Ewings (Ind, Tavistock South West) said: “West Devon’s communities depend on reliable, accessible leisure services and we know how important these centres are to everyday life in our borough.

“The collapse of Fusion Lifestyle would have caused inevitable disruption and we have moved quickly to put a stable arrangement in place so that the centres stay open and residents continue to have the facilities they expect and deserve. We are determined to build a more dependable leisure service for West Devon.”

In a FAQ section on the council’s website, it said Fusion, which is a charity, had made significant attempts to secure new funding. “However, despite some interest, these efforts were unfortunately unsuccessful.”

South Hams District Council has provided rescue packages to Fusion totalling nearly £1 million over the last few years after it struggled post-pandemic, some of this being Covid recovery funding from the government. 

West Devon Borough Council also gave the company nearly £300,000 to ensure its leisure centres could stay open in 2020.

The decision to bail out Fusion has often met with criticism.

South Hams District Council executive member for leisure Julian Brazil (Lib Dem, Stokenham) said the council felt let down by Fusion, which had “failed to meet its own promises, timescales and deadlines”.

He said taxpayers had been subsidising the company for years and there was still a multi-million-pound loan that the council was paying interest on for revamping Ivybridge Leisure Centre.

“I would like to thank officers who have worked incredibly hard to get the best ending we could get, so we can have a measured and controlled handover,” he said.

“Probably residents will not notice any difference other than a new logo on the buildings in due course.”

He said providing leisure services was not a statutory duty for the council, but members were “absolutely unanimous” that they would keep them going as they provided “a lot of goodness and wellbeing to the community”.

The contract is short-term due to local government reorganisation being imminent, he added.

Fusion has appointed Nadeem Sweiss and Adam Stephens of S&W Partners LLP as joint administrators.