Asset transfers – a great way of developing community assets, or a convenient for local authorities to get rid of ramshackle facilities, or both?

Asset transfers of community buildings and sports facilities have taken place across the UK for a few years now. In many cases, they have gone well and a bunber of community groups and sports clubs now run their own facilities and can grow their impact in the community.

An example is Jesmond Swimming Pool in Newcastle which was one of the first sports facilities to be transferred to community ownership in 1992. Since then it has been an innovative award winning social enterprise.

Freed from the constraints of the bureaucracy of the local authority the management has developed an innovative and enterprising culture which is the envy of most other pool operators.

Community Asset Transfer (CAT) is the transfer of management and/or ownership of public land and buildings from its owner, usually, a local authority, to a community organisation,  such as a social enterprise or sports club/trust, for less than market value – to achieve a local social, economic or environmental benefits.

In times of cuts to local authority funding, most Councils have had to either close down loss-making community facilities and sports centres and pitches or undertake a CAT, often to one, or several, of the tenants/users of the facility. So the tenant becomes a landlord, with all what the entails of challenges and opportunities.

So, in principle, this should all be good stuff – all part of The Third Way or The Big Society, depending on your political persuasion.

However, it has to be said that during our with community sports providers we have come across too many examples where we have experienced asset transfers being botched. This is partly due to incompence and less than fair and decent behaviour from local authorities and real lack of understanding of the challenges at many community sports clubs.

There are indeed a number of guides to CATs, including a brilliant one produced by the Scottish FA  https://www.scottishfa.co.uk/media/2288/guide-to-community-asset-transfer.pdf, but we do wonder how many parties involved with asset transfers actually bother do reads these guides. Our straw poll certainly confirms that neither the Estate Manager at the Council or whoever else is involved with the asset transfer rarely do more than 2-3 asset transfers in their careers nor do the Secretary/Chair at the club do more than one asset transfer. So, it’s very much the blind leading the blind.

We have just seen a case where the Council did not issue the guide and criteria for evaluating the asset transfer bid until after the deadline. The people in charge at the Council were either on sick leave or on holiday so it was impossible to get any response for the bidders.

In the end, the asset has now been promised to a consortium of clubs which includes a club which has gone bust twice and is no longer affiialited to the appropriate governing body. When the relevant Director at the Council was queried about the soundness of the decision hand over the asset to a twice-bankrupt organisation the answer was that ”we should look forward, not backward’.

At the same time, we come across too many club committees who have not a real grasp of the business and enterprise aspects of running the facility, but just want to ensure that they still have a home, or so they think.

I was with one community sports club which was about to take other the two muddy pitches and an almost derelict club house. The only person on the communittee who had seen the budget was the Treasurer who had produved the budget, so the club’s management was blissfuly unaware of what they were taking on Also, the club was not incorporated as a Community Interest Company or Charity or something else, so the committee members would all be personally liable for any debts incurred.

Until we got involved no one had pointed that out to the committee members.

So, unfortunately, many Councils are handing over facilities to clubs and groups which may not always have the necessary enterprise culture and skills which can lead to very unfortunate situations.

Are you ready? Is your club ready for asset transfer?

Whilst community asset transfer is a process in its own right, much of the work preparing for CAT is about capacity building your organisation in readiness. This means:

• Making sure you have the right people and skills leading and governing the organisation
• Having the right structure (type of organisation) and protection (legal structure)
• Understanding and managing the risks that come with running a group and managing a building
• Being able to show how a building will help (and not hinder) your organisation in achieving the positive changes for people which your organisation exists to help.
• Having enough money and having robust plans for continuing to have enough money to run your group, its activities and a building
• Having a written, useful plan of all of the above

 Are you sure? Have you:

• Gathered evidence to show how the community and local people will benefit from the transfer?
• Gathered evidence of community support for the transfer?
• Checked that you understand Manchester City Council’s Asset Transfer Strategy and if there have been other Community Asset Transfers nearby from which you can learn? 
• Checked that land and buildings in question really are assets and not liabilities – for example, they are liabilities if they cannot generate enough income to fund repairs, maintenance and ongoing operational costs?
• Considered whether asset transfer is the right option and the best option for your organisation?

Is your organisation ready for asset transfer?

The healthcheck can cover key areas, for example:

• Checking whether you have a legal structure and if it is right for asset transfer
• Checking that your governing document, objects and powers allow an asset transfer
• Looking at your proposed business model –will it work for asset transfer?

 So how can Councils improve the way they handle their assets transfers?

• Learn from others – failures and successes
• Be honest about own motives, culture and skills
• Get your plan and timeline sorted from the outset
• Make sure the community clubs/groups do possess the appropriate enterprise culture and skills – if they don’t signpost them to appropriate advice

  If you would like to have a chat about Community Asset Transfer, just get in touch. Svend Elkjaer [email protected]