Folkestone & Hythe DC’s Leas Cliff Hall Contract: The £13.2m ATG Payment Trail Behind a £10m Deal
shepwayvox
The council’s own papers show a 20-year RPI-linked deal, no profit-share, falling ticket sales, patchy monitoring — and a public contract register that still tells residents this was a £10m arrangement.
By The Shepway Vox Team
The Leas Cliff Hall has given Folkestone nights to remember: bands, comics, school prize-givings, pantomimes, conferences, weddings, and the odd civic bunfight with tea, name badges and the faint smell of municipal carpet.
But behind the stage lights sits a quieter show. It’s not a musical. It’s not a panto. It’s a 20-year contract, an RPI ratchet, a public payment trail, and a contract register that appears to have gone out for an interval drink sometime around the mid-2010s and never quite made it back.
The figures we’ve checked from Folkestone & Hythe District Council’s published payments to suppliers show 206 payments to ATG (Venues) Limited between 2011/12 and 2025/26, with a gross total of £13,188,325.44. (FHDC did not publish payment data prior to 2011. The true figure for the payments when 2006 – 2010 are included, is closer to £16.5m from what we can estimate from avaliable data)
Of that, £13,032,544.09 is recorded under “Contract- Leisure Management” and “Third Party Payments”. In plain English: the overwhelming bulk of the money wasn’t odd bits of hire, cups of tea or civic bunting. It was the Leas Cliff Hall management arrangement.
The contract register, however, says the Leas Cliff Hall Lease and Management Agreement is worth £10,000,000.
Curtain up. Calculator out.
One contract, two moving parts
The first important point is that this does not look like two separate live ATG contracts. It looks like one composite arrangement: a building lease plus a management agreement.
The council’s own 2014 scrutiny report says the “Leas Cliff Hall contract incorporates the building lease and management agreement”. It names the contractor as Ambassador Theatre Group Venues Ltd, formerly Live Nation Venues and Clear Channel, and says the lease runs from 30 June 2006 for 20 years.
That means it runs to late June 2026. We are not looking at an ancient curiosity from the bottom drawer. We are looking at a live public-money arrangement reaching its final act.
The public contract register gives the same basic story: contract reference DN266069, start date 30 June 2006, end date 29 June 2026, initial duration 240 months, no extensions, and contract award/total/estimated value all shown as £10m.
That £10m figure is where the floorboards start creaking.
The council’s published payment data available to us begins in April 2011, nearly five years after the contract started. Yet that shorter slice alone shows £13.188m paid to ATG. So the public payment trail from 2011 to 2026 already exceeds the register value by about £3.19m, before anyone counts whatever was paid from 2006 to March 2011.
That doesn’t prove unlawful overpayment. It does prove the register is a rotten guide to the real lifetime cost.
The RPI ratchet
The deal was built to rise.
The 2014 scrutiny report says the council had three monthly financial obligations: a management contribution originally set at £350,000 a year, a maintenance contribution originally £45,000 a year, and a supplemental contribution equal to the rent charged by Shepway District Council.
The management and maintenance contribution were paid as a single monthly payment. The report also says the council contributions were index-linked to RPI, with a September anniversary date, and that RPI was applied to both management and maintenance.
This is the key. If residents are asking whether the council paid “too much”, the answer is more uncomfortable than a simple yes.
On the payment data, the monthly contract-management amount rises in a way that appears to track September RPI very closely from 2015 onwards. The recurring monthly payment rises from around £58,475 in 2011 to more than £104,000 by March 2026. That sounds eye-watering. It is eye-watering. But it also appears to be broadly what the contract formula allowed.
So the sharpest criticism isn’t that officers obviously paid invoices they shouldn’t have paid. On the evidence we’ve seen, that case is not made.
The sharper criticism is this: the public was left with a contract register still showing £10m, while the real payment trail sailed past that number years before the contract ended.
That is not transparency. That’s transparency wearing stage make-up.
No profit-share, ATG keeps the income
This deal is even more interesting because of what the council didn’t get.
The 2014 report says there was “no profit sharing” or similar clause. It also says ATG retained all income.
So the public arrangement worked like this: the council paid an indexed management and maintenance contribution; ATG operated the venue and kept the income; and the contract transferred much of the operating and maintenance risk to the contractor.
That risk transfer matters. A council can reasonably decide it doesn’t want to run a major entertainment venue itself. Councils aren’t always known for their light touch with showbusiness. Nothing says rock and roll like a procurement timetable, a risk register and a meeting with apologies for absence.
But if the council gives a commercial operator the income, protects that operator with an inflation-linked payment stream, and doesn’t share in profits, then performance monitoring becomes absolutely critical.
That is where the documents start to speak rather loudly.
The monitoring problem
The 2014 report says liaison with the contractor had been “sporadic” until recently and not at the level originally envisaged. It also says that, before 2013, meetings and property inspections were done on an ad hoc basis and records were limited.
This matters because the Leas Cliff Hall wasn’t a paperclip contract. It was a 20-year public asset arrangement involving millions of pounds, maintenance obligations, community use, ticket sales, performance data, health and safety and future viability.
The council was not running the venue day to day. Fair enough. But it still had to know whether the deal was working.
And the council’s own papers show that by 2014 the picture was hardly confetti and jazz hands.
The contract required ATG to provide at least 265 days for entertainment or conference events, although the report warns the figures were hard to assess and should be treated as a best guess. The performance appendix shows total assessed days below that level in several years: 196 in 2008, 185 in 2009, 195 in 2010, 167 in 2011, 229 in 2012, 227 in 2013, and 261 in 2014.
Ticket admissions also fell sharply. The appendix shows admissions at 79,539 in 2006, then 69,531 in 2007, 57,405 in 2008, 53,438 in 2010, 36,900 in 2011, and 34,889 in 2014. The 2014 report says ticket sales since the start of the agreement had declined by roughly 50% and described that as a major concern for the long-term viability of the venue.
There is the awkward scene change. The public subsidy kept rising with inflation, but the performance data showed a venue struggling to hold its audience.
Maintenance, risk and the old Apollo story
The arrangement didn’t begin with ATG branding. Earlier papers show the roots go back to Apollo Leisure and the late-1990s redevelopment proposals.
A 1999 Shepway report said there had been “no competition for the lease”, while also explaining the council’s view that the contract-standing-order position was complicated by land disposal and service provision. The same paper said the District Auditor had been consulted and that the development appeared to provide good value, subject to safeguards around maintenance, monitoring of capital spend, and audit sanctions for any proposal to vary the annual management fee other than inflation.
The 1999 report also put some important numbers on the table: the council would contribute £1.5m towards expected capital costs of £2.25m, and about £45,000 a year towards maintenance, increased annually for inflation.
In other words, this was always a complicated hybrid: property, public asset, theatre operation, maintenance risk, civic pride and private-sector entertainment rolled into one.
The 2014 report says ATG was predominantly responsible for repairs and maintenance and had to keep the venue in no worse condition than at the date of the agreement. It also records an estimated contractor maintenance commitment of £1,705,810 over the contract period, based on 2006 figures, with ATG potentially committed to about £800,000 on top of the council’s maintenance contribution depending on actual costs.
But the same report says older records were limited and that changes in company ownership before 2011 meant some records were unavailable. That is a sentence that should make any scrutiny councillor sit up straight.
A 20-year contract with public money attached should not require the council to rediscover its own agreement halfway through the run.
The 2026 budget still carries the cost
The contract may be nearing expiry, but the budget papers show the Leas Cliff Hall line is still alive.
In the 2026/27 Cabinet budget pack, EA01 Leas Cliff Hall shows £976,828 actual in 2024/25, £1,043,810 original budget in 2025/26, and £1,052,310 original budget in 2026/27. The variance is described as contract/non-controllable inflation.
Another budget table states: “Leas Cliff Hall management contract inflation based on indexation at 4.44%”, adding £8,500 as a permanent pressure.
So while residents are told to worry about savings, service pressures, council tax and every other item in the municipal begging bowl, this contract continues doing what it was designed to do: rise.
Again, that may be contractually correct. But “contractually correct” is not the same as democratically well-explained.
What should be asked now
This story needs care. It would be wrong to say, on the evidence currently available, that ATG has been overpaid. The payment pattern largely fits the RPI mechanism. It would also be wrong to say the council got nothing: the venue remained open, hosted events, carried maintenance obligations and continued as part of Folkestone’s cultural life.
But it would be equally wrong to pretend the public record is healthy.
The council should now publish, or explain why it won’t publish, the executed 2006 lease and management agreement; any deed of variation; the full payment schedule from 2006 to 2011; the annual rent/supplemental contribution calculation; the monitoring records for ticket sales, entertainment days and community use; the maintenance fund position; and the basis on which the contract register still says £10m.
And because the forward plan now carries a Leas Cliff Hall New Lease project, with exempt information expected, councillors should be alert. The next deal must not be agreed in a fog of commercial confidentiality and then explained to residents 10 years later with a spreadsheet and a shrug.
Folkestone loves the Leas Cliff Hall. So do we. That is precisely why the public deserves better than a contract register that looks like it has missed the second half.
The old show is nearly over. Before the next one opens, residents need the full accounts, the full contract story, and no more theatrical lighting over the numbers.
