Council leaders have been told to rethink a decision to spend £2.1 million fitting out a new gym in Manor Park.
Newham Council’s cabinet agreed to release the funding for the gym at the Greenhill Centre development in High Street North last month.
But at a meeting held to challenge the decision earlier this week (Tuesday 7 October) councillors said they were “not satisfied” that the £2.1m expenditure was justified.
They also said the council should have explored “other sources of funding other than the public purse”.
Their vote means the council's cabinet will have to reconsider the decision.
The new gym is intended to be a replacement for the Manor Park fitness centre, which closed in 2021 to make way for the new Greenhill housing development.
The cabinet agreed in February to allocate the £2.1m of capital funding – which pays for assets and infrastructure, and is separate to its day-to-day budget – to fit out the gym.
It then agreed last month to release that funding to the company that runs the council’s leisure services, GLL.
The report approved by the cabinet said the council had taken into the “best value notice” that the government issued it in May.
This included an order that the council “improve its financial sustainability”.
However, councillors on the overview and scrutiny committee raised concerns about the decision, particularly about how the council had justified the level of spending, and whether it had looked into other ways of funding it.
Committee member Susan Masters (Labour party) asked whether the proximity of the Atherton Leisure Centre in Forest Gate meant that a new gym in Manor Park was needed.
She also asked if the council could find a “cheaper option” to provide a fitness facility on the new site that isn’t a gym.
Fellow Labour party councillors Joshua Garfield and Liz Cronin asked if the council had considered alternative commercial or private sector uses for the site instead.
Responding to their questions, the council’s director of commissioning and integration Simon Reid said the council had not considered commercial options.
He said that this was because the new gym was intended to be a replacement for the former council-run Manor Park fitness centre.
Reid said: “This was never considered as a commercial opportunity. My understanding, back from 2021, it was about the re-provision.”
He added that the council made a “significant saving” through its leisure contract with GLL, but that this required investment in its services.
Reid said that making changes to the type of facility on the site would need a “material amendment” to the council’s contract with GLL.
Cllr Rita Chadha, the council’s cabinet member responsible for health, said the spending was an “invest-to-save decision”.
She said: “We’re very conscious of the best value situation and within that context I think this needs to be looked at extremely carefully in terms of what it is doing to benefit the borough and the financial position in particular.”
Cllr Chadha added: “It’s a resource that’s very much needed in Manor Park and I think it’s in keeping with many of our commitments around improving and supporting the health and wellbeing of residents.”
However, the committee voted to “call in” the decision, which means the cabinet will have to reconsider it at a future meeting.
The committee concluded that it was “not satisfied that comprehensive financial appraisals were undertaken to justify the £2.1 million expenditure on facilities and equipment”.
It was also “not satisfied that alternative funding sources other than the public purse has been explored or found to fund the fit-out”.
