Agenda item - Recommendations from the Cabinet

Agenda item

Recommendations from the Cabinet

To consider the recommendations from the meeting of the Cabinet held on 12th July 2023 (to follow).

 

Minutes:

Council was informed that there had been no recommendations made at the Cabinet meeting held on 21st June 2023.  However, recommendations had been agreed at the meeting of Cabinet held on 12th July 2023.

 

Worcestershire Housing Strategy 2023-2040

 

The Cabinet Member for Health and Wellbeing and Strategic Housing presented the Worcestershire Housing Strategy 2040 for Members’ consideration. It was reported that the strategy set out a 20-year vision for the County and the significant role it played in decisions for housing in the future.

 

Cabinet was informed that the strategy would be delivered through four priority areas as follows:

 

  • Economic Growth and Jobs
  • Quality and Standards
  • Health and Wellbeing
  • Net Zero Carbon and Climate Change

 

The Cabinet Members for Strategic Housing, Health and Wellbeing explained that the recommendations detailed in the report were being proposed with a slight alteration to the wording of the first recommendation, as detailed below:

 

“The Worcestershire Housing Strategy 2021 – 2040 be adopted in principle.”

 

In terms of the future for the District, it was confirmed that there would be a local Action Plan introduced in order to address issues at a more local level. This was in the process of being worked on by Officers. 

 

The recommendations within the Worcestershire Housing Strategy 2023-2040 report were proposed by Councillor S. Webb and seconded by Councillor K. May.

 

Following the presentation, there was a detailed discussion regarding the report, which included the lack of detailed responses to the issue of Climate Change and the risks it posed to communities within the strategy. There was also reference made to several previous Government reports that had referred to specific risks that would be faced by residents and their communities in the future.

 

Council was reminded that this was a County wide strategy and was part of a bigger picture and provided a roadmap for the future. Further details in respect of Climate Change would be apparent within the local Action Plan and the Cabinet Member for Climate Change would certainly be involved in this.

 

Some Members welcomed the strategy and expressed the view that it was good to see that Bromsgrove District Council were taking a lead in this strategy. It was with this in mind that sincere thanks were extended to the Chief Executive in his role as Chair of the Worcestershire Housing Strategy Board. Furthermore Councillor S. Webb was also thanked for her work as the relevant lead Cabinet Member.

 

Member involvement in the formation of both the local Action Plan and the Council Plan was raised. Members queried whether there would be an opportunity for them to be involved in order to ensure that essential areas were covered in both plans, including affordable housing. It was confirmed that this would be the case and that Strategic Planning Steering Group (SPSG) meetings were in the process of being arranged to discuss these matters further.

 

Further discussion included reference to the disparity between house prices and income within the District and the growth in numbers of people diagnosed with dementia between 2019 and 2035 and what plans there were to address these areas.  Members were also keen to understand what percentage of affordable homes there were within the District. Officers undertook to provide this information.

 

During a detailed debate, Members raised concerns about adopting the strategy, as it would result in being tied to a strategy that may prove difficult in the future. It was with this in mind that Councillor A. Bailes proposed that an amendment to the recommendations within the report be made and that ‘in principle’ and ‘guidance outlined’ be added as follows:

 

  1. “The Worcestershire Housing Strategy 2021 – 2040 be adopted ‘in principle’.

 

  1. Officers be asked to develop a District Level Action Plan with consideration given to the ‘guidance outlined’ in this Strategy.”

 

Members were once again reminded that this strategy was overarching and that local issues would be addressed in the Action Plan. The Cabinet Member for Strategic Housing, Health and Wellbeing invited Councillor A. Bailes to join the Committee who would be working on the Bromsgrove Action Plan to help provide assurance of how it would work in the future.

 

It was suggested that the consideration of this report be deferred to help Members better understand the details. However, it was noted that the strategy needed to be adopted by September 2023 and therefore there was not the opportunity to defer this matter and reconsider it at a later date.  Members were reassured that local detail would be included within the Action Plan as stated in the preamble above and it was noted that the Cabinet Members was already proposing to adopt the strategy in principle.

 

On being put to the vote it was

 

RESOLVED that

 

  • The Worcestershire Housing Strategy 2021 – 2040 be adopted in principle.

 

  • Officers be asked to develop a District Level Action Plan with consideration given to the proposals in this Strategy.

 

Approval to Spend

 

The Cabinet Member for Finance and Enabling presented the Approval to Spend report. It was noted that the report set out the key implications of the new Procurement Bill, which needed to be enacted by 1st April 2024.  The Bill brought even more transparency to how Councils undertook their business. 

 

It was stated that the Bill would reform the UK’s public procurement regime, making it quicker, simpler, more transparent and better able to meet the UK’s needs while remaining compliant with the authority’s international obligations.

 

Furthermore, Members were informed it would introduce a new regime based on value for money, competition and objective criteria in decision-making,creating a simpler and more flexible commercial system that better met the country’s needs. It would more effectively open up public procurement to new entrants such as small businesses and social enterprises so that they could compete for and win more public contracts.      

 

Although this was a large area of work, the Council had already begun to put measures in place which had resulted in the majority of the requirements under the new Bill already being met with only a few changes required for transparency purposes.  Measures already in place included:

 

·        The Council’s No Compliance No Order regime which was implemented on the TechOne system on 1st April 2023. With this, an order could not be raised unless it was linked to a contract or an identifiable procurement route.

·        All new suppliers had to be approved by the procurement and payments teams. 

·        Monthly spending of over £500 was published on the Council’s Website.

·        The Council had an European Professional Card (EPC) Card system for small expenditure.

·        The contracts register was available to Officers, Members and the Public to view.

·        The Procurement team was available for monthly meetings with Heads of Service, which ensured that the procurement team had visibility of what service departments were procuring in order to ensure contracts were set up in a way that accorded with the No Compliance No Order regime.

·        Procurement training could be provided to the teams on request.

·        Monthly Accounts payable training was being delivered.

·        There was a dedicated Procurement Team page on the Council’s website.

 

Members were informed that Part 6 of the Constitution contained the Officer Scheme of Delegation.  The Scheme of Delegation set out what decisions were delegated to Officers. The Council’s Constitution set out that from a financial basis a ‘Key Decision’ was any item that had a combined financial spend (either as a single item or for the length of the contract) of £50,000 or more.  This, it was clarified, included Revenue, Capital and Section 106 allocations.

 

Notice needed to be provided by the Council in respect of any Key Decisions due to be taken and this was achieved at the Council  through the publication of forthcoming items of business on the  Cabinet Work Programme.  Once this had taken place Cabinet decisions were actioned via a Cabinet Report and decisions delegated to Officers were actioned and further publicised through Officer Decision notice.

 

 

It was confirmed that the Council’s Procurement Pipeline provided a forward look of potential contracting opportunities when existing contracts were due to expire. The key task of the pipeline was to allow for proper planning of procurements to ensure the Council maximised its contracting opportunities.

 

From the data provided to Members from the existing contracts register, it was clear that the £50k threshold for Key Decisions covered far too many projects as many contracts lasted for multiple years.  The majority of Councils had traditionally set the key decision limit at the European Union Threshold level of £179k. 

 

Further information on Key Decision limits in respect of other Councils in Worcestershire and the wider local area was provided as follows:

 

·       Wyre Forest District Council - £50k

·       Worcester City Council – £164,176 in 2017 (prior to the introduction of a new governance structure)

·       Birmingham City Council– Capital £1m, Revenue £500k, Chief Officers £200k

·       Solihull Metropolitan Borough Council - £500k

·       City of Wolverhampton Council - £250k

 

The national Contracts finder level was reported as being also set at £200k. 

 

Members were informed that the report had been reviewed by the Finance and Budget Working Group on behalf of the Overview and Scrutiny Board on 7th July 2023.

 

An Approval to Spend report would be considered at Cabinet on a quarterly basis. Implementing this measure would ensure even greater transparency.

 

Following presentation of the report, Members discussed the proposals.  Some Members commented that they were disappointed that the Constitution of the Council had been breached by Officers and that certain reports had not been provided to Members on some occasions. Although Members understood the need to potentially raise the Key Decision threshold due to the nature of some of the contracts within the Council, £200k was deemed too high by some Members and it was requested that the increase be in line with inflation. This would result in raising the threshold to £60k at the most during the present time. This amendment was proposed by Councillor P. McDonald and seconded by Councillor J. Elledge.

 

In considering the proposed amendment, some Members stated that these concerns had not been mentioned during the consideration of the report at the Finance and Budget Working Group as detailed above, and they expressed their disappointment about this. It was also reiterated by Officers that the proposals, as set out within the report, would allow Officers to produce more reports and increase transparency. Contracts valued at £50k - £199,999 would also still be reported to Cabinet on a quarterly basis.

 

Councillor McDonald subsequently stated that there were a number of new Members within the Council following the local elections in May 2023; and that they needed to be better informed of the procurement process within the Council before making a decision. Given that the changes did not need to be implemented until 1st April 2024, he requested that this item be deferred and that all Members be provided with further information on the changes and the procurement process going forward.

 

Subject to the preamble above, the Approval to Spend report was deferred and Officers were tasked with providing additional information to Members in the future.   

 

Draft Treasury Management Outturn Report 2022/23

 

The Cabinet Member for Finance and Enabling presented the Draft Treasury Outturn Report for 2022/23, which included the draft outturn position on the Council’s Capital and Treasury Management Strategies, including all prudential indicators.  It was clarified that there was a requirement for progress in this area to be reported through Cabinet and then to Council. 

 

The 2021 Prudential Code included a requirement for local authorities to provide a Capital Strategy, a summary document approved by full Council covering capital expenditure and financing, treasury management and non-treasury investments. The Authority’s Capital Strategy, complying with CIPFA’s requirement, was approved by full Council on 27th June 2022.

 

Included with the report was a summary of the fluctuating economic position for the year from the Council’s Treasury Advisors ArlingClose.

 

On 31st March 2023, the Authority had net borrowing of £2.5m arising from its revenue and capital income and expenditure. It was clarified that the underlying need to borrow for capital purposes was measured by the Capital Financing Requirement (CFR), while usable reserves and working capital were the underlying resources available for investment.

 

The Council was making returns in the region of 4% for the balances it was investing in the short term (working capital) and it was confirmed that the Council did not have any long-term debt as the Capital Programme had been financed using working balances.

 

The remainder of the paper set out how the Council was complying with its prudential indicators.

 

The recommendations contained within the report were proposed by Councillor Hotham and seconded by Councillor May.

 

Following the presentation of the report, Councillor May extended her sincere thanks to the Finance Team for their significant work in this area and commented that the Council was in a stronger position than most due to the lack of borrowing.

 

RESOLVED that the Treasury Outturn position for 2022/23 be noted. 

 

Establishment of a Housing Company

 

The Cabinet Member for Finance and Enabling presented the Establishment of a Housing Company report for Members’ consideration. In doing so, it was stated that the report being considered at this meeting followed a number of reports presented to Cabinet on the Burcot Lane Housing Development Scheme at the site of the Council’s former offices. It was agreed that the Council would undertake the development of 61 dwellings at the site with the sale of 6 units on the open market and the sale of 18 units of affordable housing to Bromsgrove District Housing Trust. It was also proposed that the remaining 37 units be provided as private rented accommodation. The details in respect of the options of the management of the remaining properties had been included within the report.

 

Council was informed that the overarching aim of the development was for the authority to assist in balancing the local housing market by providing high quality private rented housing which would also result in the Council having a long-term capital asset and play an important role in the housing market, which was lacking in Bromsgrove, in the future.

 

It was hoped that as a result of this development, the Council could work to not only increase the number of privately rented properties but also help towards improving standards within the sector. The creation of a Housing Company provided the framework to meet this ambition of the Council and to provide services that were appropriate to the management of private rented stock.

 

Council was further informed that there were two additional recommendations to those recommended by Cabinet on 12th July 2023. These further recommendations had been tabled for Members’ consideration at this meeting.

 

All recommendations were prosed by Councillor Hotham and seconded by Councillor Webb.

 

Following the presentation of the report, Members questioned several areas within the report, including the outstanding £6m debt that had been incurred by the Council during the building of the Burcot Lane Housing project. It was confirmed that the debt would stay with the Council, however the Housing Company would pay the interest on the debt back to the Council.  It was also confirmed that the Council owned the lease to the units and that these would not be sold, leaving the Council in ownership of both the lease and the units in the future.

 

Members commented that this was a successful project and would provide high quality, affordable housing to residents within the District. The rental costs for the units were confirmed as being set at market rent.

 

There was a large amount of support for the project, particularly in light of the fact that the properties were to be leased and no option for the Right to Buy.

 

Members stated that they were very proud of the project and that should any Councillors wish to visit the site prior to the opening, they should contact Members or Officers to arrange a site visit.

 

RESOLVED that

 

1)    A housing company limited by shares wholly owned by the Council be established.

2)    By way of a formal loan agreement between the Council and the housing company and in compliance with the requirements of subsidy control (formerly State aid) the Council provide the housing company initial operating capital to the sum of £50,000.

3)    Subject to Members’ agreement to establish a housing company, a housing company board be established, comprising a membership of 2 Non-Executive Directors and 3 Executive Directors: the Head of Community and Housing Services, the Head of Finance and Customer Services and the Strategic Housing Services Manager.

4)    Authority be delegated to the Director of Resources to undertake a recruitment process to appoint 2 non-Executive Directors to the Housing Company Board.

 

Supporting documents: