CASC consultation sparks disagreement

Several golf clubs and at least two golfing organisations have responded to the Community Amateur Sports Clubs (CASC) consultation exercise, which shows little agreement in the golf industry over the best way forward.

How CASC is shaped will have a major bearing on the finances of golf clubs in the UK. Currently it is only available to private members’ clubs, which proprietary clubs have said has led to distortion.

Since 2002, 462 private members’ golf clubs have registered as CASC, which entitles them to approximately 80 percent business rates relief, partial corporation tax exemption and the ability to claim Gift Aid on voluntary donations. In exchange the clubs have to be open to the entire community, while all profits must be invested back into the club.

However, some proprietary golf clubs have complained to the government that some CASC clubs, particularly wealthier ones, have abused the spirit of CASC to gain unfair competitive advantages. The government responded by launching the consultation exercise in which it proposes that if members of golf clubs pay more than £1,040 per year to play the game – which includes the cost of their annual subscription plus all other expenditure – the golf club can no longer secure CASC status.

Some think the government’s proposals go too far and others not far enough, while one organisation is even calling for CASC in golf to be scrapped.

Michael Ramsey, the owner of Stockwood Vale Golf Club in Bristol, has written to the government to say that CASC has led to unintended consequences.

“Under CASC rules, proprietary golf clubs cannot apply to be CASCs because they are not organised on an amateur basis,” he wrote. “But both members’ clubs and proprietary clubs encourage sport at the local community level, both provide facilities for amateur sport and both encourage people to participate in golf.

“Although it was never seen and certainly wasn’t intended, CASC has created a large and unfair distortion in the golf industry.

“CASC clubs benefit from the rate reliefs and other tax benefits – which are not available to proprietary clubs offering the same facilities and services within the same local community. All golf clubs actively compete for the same customers.”

Proprietary Mid Sussex Golf Club added: “We work with the local council to identify ethnic groups who are then proactively welcomed to the club for teaching and who are given access to equipment and practice facilities. We work with the physically and mentally disabled, and provide both learning and practice facilities to the aged. We are also the home of the Sussex juniors’ teaching programme. We have an initiative to attract ladies to take up golf … but we cannot access the CASC scheme simply by virtue of being a non-members’ club.”

However, England Golf, the body that runs the amateur game in England, which represents more than 1,900 golf clubs, with about 47 percent of them being proprietary, has said that the £1,040 figure is only fair if it relates to the membership fee and no other costs, such as golf equipment.

“It is our view that whilst the figure of £1,040 is acceptable in general terms for membership fees, there should be some staggered flexibility to take into account geographical economic differences, but not for full costs of participation, so long as it is recognised that each eligible club must either have a fee structure which allows reasonable entry at this level or below, or allows non-members to play on the course by paying a green fee, thereby opening the course to the community,” said a spokesman.

“Clubs should not be excluded from CASC for having other membership categories at a higher rate, so long as they do have membership categories at £1,040 per annum or less.”

To see the whole response, click here.

Meanwhile, the United Kingdom Golf Course Owners’ Association (UKGCOA), which represents 169 predominantly proprietary golf clubs, has said the government’s proposals ‘fail to achieve the primary objective of CASC within golf and are irrelevant to the golf sector’. The organisation is calling for CASC to be removed from golf clubs.

“Remove golf from the list of eligible sports for CASC and provide the estimated £12m, in business rates relief currently, in the form of a targeted grant to England Golf and the other home golf unions, as the recognised representative bodies for amateur golf, for them to distribute according to the community focused criteria as they see fit,” said Andrew Lloyd-Skinner, chief executive of UKGCOA,

As part of the government’s proposal, responders are asked to pick one of four options that would shape the CASC scheme, including limiting the amount of money CASC clubs can generate from non-members to a percentage of turnover, which is the government’s preferred option, a capping of non-sporting income, a capping of different types of non-sporting income or an increase in how much the club’s facilities can be open to non-members.

One proprietary golf club manager said he was ‘disappointed’ that UKGCOA did not pick any of the options, especially the first one.

Meanwhile, Robert Twydle, a VAT expert with Hillier Hopkins LLP, and tax adviser to several private members’ golf clubs, has criticised the whole exercise.

“Quite frankly, the limit on subscriptions is unworkable for most clubs in the south east of England,” he said.

“The government is trying to discriminate against more expensive sports and has no idea of the costs for golf clubs.

“I understand that they do not want clubs that are, in reality, trading businesses, to be CASCs, but in trying to limit the levels of [non-golfing] turnover they are missing the point. In most clubs, any non-sporting income is raised purely to subsidise the costs of playing the sport and, in the main, comes from the existing membership. If you try to restrict this, the only effect is to increase the cost of membership!”