Batemans Bay Pavilions: Council’s plan to reverse $5m per year operating costs
Costs to run a recently opened aquatic and performing arts centre on the NSW south coast have blown out to more than $5m in the last financial year. See what this means for the facility’s future.
The South Coast News
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A NSW south coast council could renegotiate its contract with an AFL subsidiary company – who runs its recently opened aquatic centre – after revelations the facility cost more than $5m to operate for one year.
AFL giant Richmond Football Club’s subsidiary company, Aligned Leisure [AL], has operated the Batemans Bay Pavilions for Eurobodalla Council since its opening in 2022.
However, the council’s director of community, arts and recreation services, Kathy Arthur, revealed the facility, which features multiple pools, a 350-seat theatre and gym, cost council $5.06m in the 2023-24 financial year.
This is far beyond the estimated $311,000 calculated during construction.
Mrs Arthur said the high costs included contract and materials, depreciation, energy costs, maintenance and insurance.
“This presents a significant challenge,” she said.
The report found visitor numbers were not an issue, with more than 280,000 people attending the centre in the last 12 months; 8 per cent higher than the previous year.
The findings have been prepared in a sustainability report, which was considered by the council during a meeting on August 22.
The report notes if changes aren’t made, the facility will continue to cost $5m to $6m per year across the next 10 years.
It suggests 26 cost saving changes for council to consider, including renegotiating its three-year contract with AL.
The contract states Eurobodalla Council pay AL $244,000 annually to run the facility, while council pay the operation costs.
“The Plan aims to optimise business and financial opportunities within this context, enabling positive community benefits and service delivery outcomes at the facility,” Mrs Arthur said.
“Resourcing the delivery of the plan will be achieved using existing staff and contractors, with work already begun on nine of the 26 actions.”
Other cost saving measures include establishing realistic performance expectations with AL, monthly monitoring of actual year to date revenue and expenses, monitoring energy consumption, exploring partnerships with new services to bring to the facility and more.
AL did not comment to this publication when asked about the facility’s financial viability.
The sustainability report comes months after a separate report prepared by professional services firm InConsult looked into the Batemans Bay Pavilions’ financial situation.
It found AL had “no skin in the game” due to the absence of performance incentives or disincentives.
“Based on the last 12 months performance, the Batemans Bay Pavilions is not currently financially sustainable,” the report stated.
“The nature of the contract also means council bears all the financial risks.”
Mrs Arthur believes if the 26 proposed changes aren’t considered, the coastal facility will continue to lose money.
“The plan defines sustainability as more than just a break-even or profitmaking position,” she said.
“It is about the establishment of a baseline of realistic financial performance expectations, achieving both value for money and quality, relevant programs and service delivery, in which community benefits and participation are maximised.”
The council voted eight to one in favour of implementing the sustainability plan.
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