PAPER B

Purpose: For Decision

Committee:     EXECUTIVE

Date:               12 MARCH 2002

Title:               REVISION OF FEES AND CHARGES AND INTRODUCTION OF RESIDENTS REGISTRATION CARD AND VISITORS CARD

                       PORTFOLIO HOLDER - TOURISM AND LEISURE

SUMMARY/PURPOSE

To consider the proposed increase for Fees and Charges for 2002/03, and where necessary 2003/04, the implementation of the new resident registration and visitors cards which form an extension to the existing Leisure Access Card System.

BACKGROUND

The annual review of Fees and Charges for Wight Leisure services has been completed and it is proposed to implement the following:-

a)        An average increase of between 3% and 4% for the majority of existing prices

b)        Introduction of a two-tier pricing system for high volume casual activities

c)        Introduction of a Residents Registration One Card to give discounts against high volume casual activities

d)        Introduction of a Visitors One Card available for 3,5 and 7 day periods

The review included detailed analysis of both current and previous years user trends, comparison with CIPFA statistics and other family group authorities, the performance of the new Leisure Access Card, market forces and overall financial performance.

In terms of pricing policies officers have also had due regard to the previous District Auditor’s Report “Income, Charging and Best Value” and the Audit Commission publication “The Price Is Right”, and where appropriate implemented recommendations contained within.

For information, the following recommendations from the District Auditor’s report, together with actions identified within the Wight Leisure Business Plan, have already been implemented or achieved:

•          An overall pricing strategy and policy

•          Introduction of a concessionary scheme for vulnerable groups with preferential pricing

•          Improved collection of reliable management information

•          Formulation and implementation of a marketing strategy

•          Regular feedback from users

The review of Fees and Charges and proposed implementation of the registration and visitors card are, again, in line with the Audit Commissions recommendations and actions reflected within the Wight Leisure Marketing and Business Plans. Namely:

•          Using the charging cycle as the framework for the management of charges and comparing the existing approach to charges with Best Value

•          Identify where there is potential to make better use of charges to meet top Council priorities (ie social inclusion - concessionary card)

•          Identify clear objectives and associated targets to guide the development of specific charges

•          Build up an understanding of users and targets to get the best out of tariff design

As a result of the review it is recommended that for selected activities there is no price increase at all, these include:

•          Bowls and tennis season tickets

•          Ryde, Sandown and Shanklin Road Trains

•          All the original Leisure Access ‘One’ Card options

In addition to the proposed fees and charges for 2002/03 it has also been necessary to set charges for 2002/03 and 2003/04 for Northwood House and the three Community Halls (Northwood, St Andrews and East Cowes) as bookings are now being accepted between 12 and 24 months in advance. The recommendation is to increase further years by an average of 3%-4%.

The introduction of the new Residents Registration Card and the Visitor Card have an impact on one another. Officers have investigated and researched thoroughly the benefits and merits of such cards and the recommendations contained within this report are also in line with those of the District Auditor, two of the main aspects being:

•          Consider increasing prices and introducing a Residents Leisure Access Card

•          The Council should develop a corporate framework for price setting that considers the resident, the tourist and corporate policy objectives

Resident Registration Card

The principle of a registration card was included in Wight Leisure’s Marketing Strategy 2002 to 2005 which was approved and accepted by the Economic Development, Planning, Tourism and Leisure Services Committee as their service plan on 26 November 2001. The relevant section of the plan stated:

“In order to maximise usage and increase resident participation, discounted rates will be introduced by either the facilities or at a corporate level as part of the One Card, Leisure Access Card Scheme.”

The proposed residents registration card will be available to all Island residents. This would be at an annual cost of £2.50 for adults, £1 for all residents that meet the Concessionary Scheme criteria and free for juniors. These cards will be renewable on an annual basis. The primary function will be to provide residents with a discounted casual rate for certain activities, following the introduction of the two tier casual system, therefore offsetting the annual charge and providing continuous savings on the identified activities. Taking up of the residents registration card will allow residents to enjoy activities at the current prices and only be subject to the usual inflation increases year on year.

It is recommended for the first three months to issue all Residents Registration One Cards ‘Free of Charge’. This will assist the smooth introduction of this scheme and prove a powerful promotional tool.

Following the introduction of the two-tier casual pricing system it is proposed to offer ‘resident’ discounts on the most popular activities. It is proposed that the new two-tier pricing structure would exist from 1 May 2002 and be applicable to the following activities initially:

Activity                                  Current          New Resident       New             Discount

                                               Casual           Reg Card               Casual         for Resident

                                               Rate               Casual Rate          Rate             Reg Card Holder

Swimming        Adult        £2.00              £2.10                   £2.50            40p 16%

Swimming        Jnr/OAP £1.30              £1.35                   £1.60            25p 15.6%

Sauna/Health

   Suite              Adult        £3.15             £3.25             £3.60            35p 9.7%

Sauna/Swim    Adult        £4.00             £4.15             £4.75            60p 12.6%

As with all initiatives, this will be closely monitored and it may become prudent to extend the discount to other services/facilities offered.

The residents registration card will protect casual resident customers prices and once established it will give the Council clear information on users and trends and ensure the Council is directing its subsidies into the core leisure services to achieve its overall aims.

The introduction of a two-tier casual pricing system together with the residents registration card should produce an estimated additional annual income of £10k. This will be re-invested into the facilities and will assist with essential works to be undertaken, these will be for the benefit of all users, both residents and visitors alike.

With regard to management information it is clearly advantageous that as many casual resident users as possible hold registration cards. This will increase the level of available management information, in particular relative to usage numbers and trends, therefore allowing programming and marketing to be more precisely targeted and the council to gain a greater understanding of its users.

Visitor Card

The visitor card, as the name suggests is targeted at encouraging visitors to utilise the facilities more often and would offer visitors a discounted fixed period leisure card.It is proposed that the visitor card will be available for 3,5 and 7 day periods and will be priced as follows:

                                                          3 days            5 days        7 days

           Adult                                      £6.00              £10.00        £13.00

           Junior/Senior Citizen              £4.50              £7.50          £10.00

The card will provide the purchaser with unlimited use of all eligible facilities and will provide a guaranteed level of income irrespective of the purchaser’s usage. Officers have calculated that it will generate up to £15k additional income, which, as with the residents registration card will be used to fund both essential and desirable works to upgrade the facilities which are currently unbudgeted for.

As with the registration card it will provide Wight Leisure with invaluable management information on users and usage trends, in particular the relationship between visitor and resident usage.

Further development of the visitor card is currently being explored which will include options of offering pre-sold cards through different outlets within the Island tourist industry for 2003/2004.

FINANCIAL IMPLICATIONS

It is proposed to increase Fees and Charges for 2002/03 by an average of 3%-4% for the majority of activities. This should enable Wight Leisure to achieve its budgeted level of income for 2002/2003 based on projected user trends.

The introduction of the two-tiered casual pricing system and the Residents Registration Card and Visitor Card should achieve an increase in income totalling £25,000 which will be used to achieve an upgrade of facilities and supplement the repairs and renewals budgets.

It should also be noted that levels of income can never be guaranteed due to a number of factors, and therefore financial performance is always monitored closely by the facility managers and senior management team.

These Fees and Charges will be used as the basis of any externalisation agreement if this is chosen as the preferred solution for the future delivery of the Council’s leisure services arising from the current Best Value Review.

OPTIONS

1.        To approve a general increase of 3%-4% for Fees and Charges for 2002/03, and where necessary 2003/04. These will be implemented with effect from 1 May 2002.

2.        To approve the introduction of a two-tier pricing system for casual use and the implementation of the new Residents Registration One Card and Visitor One Card and prices effective from 1 May 2002.

3.        Not to approve the increases.

4.        Not to approve the two-tier pricing system and introduction of the new One Cards.

BACKGROUND PAPERS

Wight Leisure Proposed Fees and Charges 2002/03, 2003/04

“Income, Charging and Best Value” - District Audit Report

“The Price is Right” - Audit Commission

Wight Leisure Marketing Strategy 2002-2005

Contact point : Annie Horne, ☎ 823838 (2MD)