A NEW charitable trust to run leisure and library services in Helensburgh and beyond will begin life facing a deficit of almost £7 million, according to a new report.

LiveArgyll, set up by Argyll and Bute Council to run libraries, leisure facilities, halls, community centres and sport development, is set to go live at the beginning of October.

Members of the council's policy and resources committee were asked to approve payment of a management fee to the new arm's-length trust of around £3.6m – rising to as much as £3.8m by 2020-21 when they met in Lochgilphead on Thursday.

The transfer of the council's leisure and library service was agreed in early 2016 as part of a £10m package of spending cuts and is aimed at saving more than £500,000 each year in non-domestic rates (NDR) and VAT.

A report for Thursday's meeting forecast that the trust will take in income of around £2.5m a year, but that its annual net expenditure will reach £4.4m by 2020-21.

The report stated that the opening net deficit for the services will be £6.797m.

Rhu resident and former Helensburgh councillor Andrew Nisbet, who chairs the trust's shadow board, said: “Leisure and cultural services have never been self-financing, across the country.

“There are financial advantages to providing these services through a trust – non-domestic rates and VAT being the key ones, though separating them from local authority control in other council areas has usually led to ways of generating additional income.

“We haven't yet got to the point of drawing up ways of generating that additional income but when we do our plan is likely to include ideas from trusts in other places who have managed to increase their revenue.

“None of these trusts, to my knowledge, are profit-making, and Argyll and Bute Council will retain a financial responisbility and will have the opportunity, through its management fee, to suggest things it would like to see more or less of.

“The fundamental problem, as I know from my days as a councillor, is that cutbacks in funding have been squeezing local authority services, and it's inevitable that services such as education and social work get more protection than functions which are perhaps viewed by some people as being more optional.

“Transferring leisure and cultural services to a trust is an opportunity to give a bit more flexibility to their operation, and we will be looking to find new and better ways of doing things to try and meet the demands there will be.”

Thursday's meeting was also asked to approve the trust's new name, Live Argyll – 'live', incidentally, rhyming with 'give', not 'jive' - ahead of the official handover on October 2.