EXPANSION plans by a company set up by Frankston Council to manage swim centres have been sunk by councillors.
Councillors at the May council meeting last week voted 5-3 to instruct Peninsula Leisure Pty Ltd directors “not to enter into or tender for projects outside of their core obligation, that being the management of PARC and the Pines Pool”.
The vote came after The News revealed Peninsula Leisure, established in 2012 and wholly owned by Frankston Council, last year expressed an interest in managing Mornington Peninsula Shire council sports centres (“Sports ‘in the swim’”, The News 16/5/17).
Councillors who voted to stop Peninsula Leisure bidding to take over sports and recreation centres outside Frankston municipality voiced concerns, while praising the company’s running of the Peninsula Aquatic Recreation Centre, about ratepayers being exposed to “financial risks” through “empire building”.
Cr Colin Hampton said directors “have done a magnificent job” running PARC but he was “very concerned” when he heard Peninsula Leisure “wanted to branch out and put in expressions of interest elsewhere”.
“I’m just being conservative. I do not want to risk ratepayers’ money in any way,” Cr Hampton said. “We have been burnt too may times – far too many times.”
Cr Glenn Aitken supported his fellow longtime councillor’s view.
“Cr Hampton remembers only too well the disaster with ‘the Gandel development experiment’ many years ago.”
Council was forced to sell Central Park nearly two decades ago to the Gandel Corporation over a failed public-private partnership to build what became the Bayside Shopping Centre.
“I don’t want to see this council go into another major risk area. The PARC management currently at Peninsula Leisure are doing an extremely good job and certainly have demonstrated the ability to be able to handle facilities like this,” Cr Aitken said.
“The interest they’ve shown in branching out is good from their perspective but at a council level, essentially a parent body in a sense, to have connections in any way with facilities in diverse or distant places takes it out of the realm of our immediate observation.”
Cr Kris Bolam said he was concerned about “overextension” and “empire building”.
“[It’s] taking away focus from the Frankston PARC facility which we’ve spent many millions on and the Pines pool that deserves any attention right now,” he said. “From what I am hearing, Peninsula Leisure are doing a great job at maintaining both facilities.”
Cr Sandra Mayer did not want councillors to limit Peninsula Peninsula’s board and “tie their hands”.
“I’ve done the company directors’ course. I interviewed all the people that are on the board except, I think, there’s one new one and one left,” she said.
“There always an element of risk … the legal advice that we got was that this was ‘low risk’ and the only possible risk was I think ‘political’ or ‘reputational’ they called it.
Cr Mayer said the Peninsula Leisure board members “are highly, highly qualified would not take on something that is high risk, I don’t believe.”
The directors of Peninsula Leisure are – chair Roseanne Healy who is also a director on many South Australia company boards; remuneration and reward committee chair Barbara Crook; strategy and marketing committee chair David Shilbury; audit and risk committee chair Simon Allatson and Phillip Johnson who is also chief financial officer of South East Water.
Mayor Cr Brian Cunial said: “The rewards, in my view, that Peninsula Leisure can deliver to not just this municipality but also to the region far outweigh any risks which can, in my opinion, be considered standard business risks.”
Cr Cunial did acknowledge councillors were concerned about expansion plans.
“[Peninsula Leisure] quite rightly should be telling us about any initiatives being explored pursued outside the region,” he said. “Unfortunately, it does appear we haven’t been made fully aware of some of those.”
Crs Aitken, Bolam, Hampton, Quinn McCormack and Lillian O’Connor voted to instruct Peninsula Leisure to only operate the two Frankston swim centres.
Crs Cunial, Mayer and Steve Toms voted against the proposal. Cr Michael O’Reilly was on leave and was absent from the meeting.
Cr Bolam said Peninsula Leisure could approach councillors at any time to discuss the possibility of managing sports centres within the municipality if a business plan was presented to council.