Watford Borough Council: Sports and Leisure Management Limited Outsourced Services

UK-Watford: Physical well-being services.

Preliminary Questions
   This notice is published by:
   Directive 2014/24/EU

Section I: Contracting authority/entity

I.1) Name and addresses
       Watford Borough Council
       Town Hall, Three Rivers House Northway,, Watford, WD17 3EX, United Kingdom
       Tel. +44 1923226400, Email: mitchelle.kasimu@watford.gov.uk
       Contact: Mitchelle Kasimu
       Main Address: https://www.delta-esourcing.com/, Address of the buyer profile: https://www.delta-esourcing.com/
       NUTS Code: UKI

I.4) Type of the contracting authority (in the case of a notice published by a contracting authority)
      Regional or local authority

I.5) Main Activity (in the case of a notice published by a contracting authority)
      Health


Section II: Object

II.1) Scope of the procurement
   
   II.1.1) Title: Sports and Leisure Management Limited Outsourced Services.
      Reference number: Not Provided
      
   II.1.2) Main CPV code:
      98330000 - Physical well-being services.
   
   II.1.3) Type of contract: SERVICES
   
   II.1.4) Short Description: Watford Borough Council intends to enter a deed of variation with Sports and Leisure Management Limited (the Contractor) as the outsourced provider of leisure management services. SLM acts as the principle in providing leisure services from the council owned premises at Woodside, Central and the paddling pool at Cassiobury Park. SLM will act as agent of the council, with SLM providing leisure services on behalf of the council in the council’s name. The Underlying Contract was originally procured under Procurement Notice Watford Sports facilities operation services 2017/S 049-089978:, published on 10th March 2017. The opportunity to change the status, follows the successful litigation taken by Chelmsford City Council in 2022 and subsequently HMRC revised its guidance in 2023 in relation to the VAT treatment of leisure services provided by local authorities.
   
   II.1.6) Information about lots
      This contract is divided into lots: No

   II.1.7) Total value of the procurement (excluding VAT)
      Value: 63,000,000      
      Currency: GBP


II.2) Description

   II.2.2) Additional CPV codes:
      92000000 - Recreational, cultural and sporting services.
   

   II.2.3) Place of performance:
      UKI LONDON
   
   
   II.2.4) Description of the procurement:
    The Authority appointed the Contractor to provide the leisure services pursuant to the Underlying Contract and Leases for the management and operation of the Council's leisure portfolio. The Authority intends to enter a deed of variation with the Contractor to modify the Underlying Contract, the effect of which will be the following: •To identify the agency agreement between the parties, the extent to which the Contractor will act as the Authority's Agent, and areas where it will act as Principal; •The Operator shall be appointed as the Authority’s Agent to provide the Leisure Services and Maintenance Services (together the “Agency Services”) but shall continue to carry out other services (specifically, food, beverages and retail) as an independent supplier to the Authority (the “Supplier Services”); •The Restated Leisure Management Agreement does not materially alter the risk position of the parties;    
   
   II.2.5) Award criteria
   (Directive 2014/24/EU / Directive 2014/25/EU)
   Quality criterion - Name: Price / Weighting: 50
   Quality criterion - Name: Quality / Weighting: 50
               
   Cost criterion - Name: Price / Weighting: 50
   Cost criterion - Name: Quality / Weighting: 50
         
      
      
   II.2.11) Information about options:
      Options:    No       
   
   II.2.13) Information about European Union funds:
      The procurement is related to a project and/or programme financed by European Union funds:    No

   II.2.14) Additional information:
    Not provided    
      
Section IV: Procedure

IV.1) Description
   
   IV.1.1) Type of procedure: Negotiated procedure without prior publication (in accordance with Article 32 of Directive 2014/24/EU)          
   
   IV.1.3) Information about framework agreement
         The procurement involves the establishment of a framework agreement: No    
   
   IV.1.8) Information about the Government Procurement Agreement (GPA)
         The procurement is covered by the Government Procurement Agreement:Yes
         
IV.2)Administrative Information

   IV.2.1) Previous publication concerning this procedure:
      Notice number in OJ S: Not provided       
   
Section V: Award Of Contract/Concession
      
Award of Contract/Concession No: 1
Contract No: Not Provided    Lot Number: Not Provided    Title: Not Provided

V.2) Award of contract/concession
      
      V.2.1) Date of contract award decision: 07/07/2025.
      
      V.2.2) Information about tenders
      The contract has been awarded to a group of economic operators: No .

      V.2.3) Name and address of the contractor/concessionaire, No. 1:
          Sports and Leisure Management Ltd, 02204085
       2 Walting Drive, Sketchley Meadows, Hinkley, Leicestershire, LE10 3EY, United Kingdom
       NUTS Code: UKF2
   The contractor/concessionaire will be an SME: No    
   
         
      V.2.4) Information on value of the contract/lot/concession:
         Initial estimated total value of the contract: 63,000,000          
         Total value of the contract/lot/concession 63,000,000         
         Currency: GBP

      V.2.5) Information about subcontracting:
         The contract is likely to be subcontracted: No          


Section VI: Complementary Information

   VI.3) Additional Information:
      To view this notice, please click here:
https://www.delta-esourcing.com/delta/viewNotice.html?noticeId=964569199 GO-202578-PRO-31324775 TKR-202578-PRO-31324774   
   VI.4) Procedures for review
   
      VI.4.1) Review Body
          Watford Borough Council
       Town Hall, Three Rivers House Northway,, Watford, WD17 3EX, United Kingdom
       Tel. +44 1923278381, Email: mitchelle.kasimu@watford.gov.uk
   
      V1.4.2) Body responsible for mediation procedures:
         Not Provided .

      VI.4.3) Review procedure
      Not Provided    
      
      VI.4.4) Service from which information about the review procedure may be obtained
         Not Provided
   
   VI.5) Date of dispatch of this notice: 08/07/2025


Annex D1 - General Procurement
Justification for the award of the contract without prior publication of a call for competition in the Official Journal of the European Union
Directive 2014/24/EU

1. Justification for the choice of the negotiated procedure without prior publication of a call for competition in accordance with Article 32 of Directive 2014/24/EU

   No tenders or no suitable tenders/requests to participate in response to: Restricted procedure

   
   
   The works, supplies or services can be provided only by a particular economic operator for the following reason: absence of competition for technical reasons
   
   Extreme urgency brought about by events unforeseeable for the contracting authority and in accordance with the strict conditions stated in the directive: No
   
   Additional deliveries by the original supplier ordered under the strict conditions stated in the directive: No

   New works/services, constituting a repetition of existing works/services and ordered in accordance with the strict conditions stated in the directive: No

   Service contract to be awarded to the winner or one of winners under the rules of a design contest: No

   

   Purchase of supplies or services on particularly advantageous terms: Not Provided



3. Explanation

   Please explain in a clear and comprehensive manner why the award of the contract without prior publication in the Official Journal of the European Union is
   lawful, by stating the relevant facts and, as appropriate, the conclusions of law in accordance with the directive: (500 words maximum)
   This VTN gives notice that the Authority is entering into a deed of variation (the "Contract") to make certain changes summarised in this VTN. A procurement procedure is not necessary on the basis that the award of the Deed of Variation of the Underlying Contract is permitted pursuant to Regulation 72 of the Public Contracts Regulations 2015. The Underlying Contract concerns the provision of a range of operation, management and related services, by the Contractor, in relation to four sports and leisure facilities and two theatres. The Underlying Contract will be varied for the adoption of an agency model for the future operation and management of the four sports and leisure facilities. Under the current structure, the Contractor acts as Principal in the supply of leisure facilities to the public, so that the Authority is not making the supplies of leisure services. Under the new agency model, the Contractor would make supplies to the public as an Agent of the Authority. This modification is being made in accordance with regulation 72 of the Public Contracts Regulations 2015. Namely, the proposed modification is not substantial within the meaning of regulation 72(8) on the basis that: 1. the modification does not render the Underlying Contract materially different in character - the proposed modification remains limited to the same type, scope and nature of services, where the services will be delivered to the same facilities. The modifications only concern contractual changes to establish an agency model for VAT purposes so that the Contract to provide leisure services to the public on the Authority’s behalf and other ancillary modifications. 2. the Council has satisfied itself that the modification does not introduce conditions which would have (a) allowed for the admission of other candidates, (b) allowed for the acceptance of another tender, or (c) attracted additional participants in the procurement procedure - the change to an agency model for VAT purposes does not change the service requirement or the way in which those services are provided, and is unlikely to have changed the outcome of the procurement. 3. The modification does not change the economic balance in favour of the contractor in a manner which was not provided for in the contract – The Authority has satisfied itself that the new agency model and VAT arrangement does not impact on the Contractor’s Operating Costs and Management Fee under the Underlying Contract, which remains reflective of market costs and does not amount to an over-compensation of the services to be provided. The agency model will allow for a more certain financial position to the Authority and will provide a greater surplus share than previously anticipated. 4. As per our comments at 1. above, the modification does not extend the scope of the contract. For the reasons set out above, the proposed modification does not constitute a substantial modification and is permitted by regulation 72 of the Concession Contracts Regulations 2015.