Tees Valley Combined Authority, Hartlepool Leisure Centre

  • The proposed subsidy is worth £15.25m in the form of a grant (applied through the overall Hartlepool Waterfront Programme) for the cost of constructing ‘Highlight’ (a new active leisure and wellbeing hub in Hartlepool). The total capital cost of the project is expected to be £34.65m – a £2.5m grant was given by the project to Sport England and a £16.9m commitment through a combination of borrowing and capital reserves.

Key Takeaways:

  • The assessment could have been strengthened had it explained the casual link between the fact the subsidy is limited to the capital costs of building the new facility, but the benefits claimed here relate to the ultimate delivery of the policy objective through the future operation of the facility by the Council.
  • This assessment failed to effectively reach a conclusion on what the counterfactual would be despite presenting two scenario’s which might arise in the absence of the subsidy – the counterfactual must be explicitly stated. In this instance, it was identified that the assessment should have identified the change in behaviour that the subsidy is expected to induce in the Council rather than the expected change in health outcome among users of the new facility. Had this been properly concluded, then further discussion would have been possible as to the changes in behaviours the Council would have because of receiving the subsidy.
  • To strengthen the assessment where the minimum financial assistance provided addressed ‘viability gaps’, the existence and size of that viability gap should be thoroughly explained. Specific information was identified as that which should have been provided to give a more detailed explanation of how subsidies are proportionate to the stated policy objectives and any limits on the subsidy which have been put in place.
  • Though the assessment clearly outlined the equity rationale, it would have been reinforced if an explanation was provided as to whether, how and why certain groups are ‘targeted’ by the subsidy given that the policy objective was to contribute to healthier lifestyles for the ‘people of Hartlepool’ in general. Additionally, information on how the subsequent operation of the facility will support specific aims in this policy objective and benefit these target groups would be beneficial.
  • When describing how certain means will not be appropriate to achieve policy objectives based on revenue projections, the assessment flagged that financial projections they have developed to support this expectation should have been included.
  • This would have been improved by explaining all the way the subsidy has been designed to minimise competitive distortions. Additionally, the assessment failed to consistently assess the impacts on competition in each of the relevant markets, nor the significance of any impacts given the localised market and higher quality ‘state of the art’ facilities it will provide.
  • Finally, the assessment could have been enhanced by having explicit consideration of the geographical and distributional impact of the subsidy, in line with the Statutory Guidance.

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Posted in Subsidy Advice Report Tracker.