Millions in baths loan 'unlikely' to be repaid
Fusion LifestyleMillions of pounds of public money loaned for the restoration of a swimming baths is "very unlikely" to be recovered, council chiefs fear.
Leisure centre operator Fusion Lifestyle, which runs Newcastle's City Baths, has gone into administration although the venue remains open while a new operator is sought.
In 2016, Newcastle City Council loaned £5.5m to the company towards the restoration of the Grade II listed building on Northumberland Road, with about £5m in repayments outstanding.
The site, which had previously been shut by the local authority as a result of budget cuts, reopened in 2020 and an £8m revamp was completed in 2024.
While it is unknown at this stage how much the council and other parties might be paid back via the administration process, Civic Centre officials admit it is "very unlikely [the loan] will be recovered in full" as the authority will be classed as an unsecured creditor.
A spokesperson told the Local Democracy Reporting Service: "It is the role of the administrators to take control of the charity and discharge duties such as paying creditors and dealing with employees.
"On a positive note, the City Baths, which is the council's asset, has now been fully restored and safeguarded.
"They are considered to be high-quality leisure facilities in the heart of the city."
'Prolonged' financial woes
S&W Partners LLP, which was appointed administrator on Wednesday, said it had worked with Fusion's management as they "collaborated closely with local authorities to explore viable options for keeping facilities open" across the country.
It said in a statement: "Most leisure centres will continue to operate, and customers and creditors are encouraged to check their local leisure centre's website and social media channels for the latest updates."
Fusion Lifestyle explained it had endured a "prolonged period of financial difficulty".
The charity, which has its headquarters in Dartford, Kent, cited "rising operational costs, reduced government funding and post-pandemic recovery challenges" as the causes of its struggles.
It said it had "made significant attempts to introduce new funding" that had been unsuccessful.