Issue - meetings

Councillor M Francis presented the Report of the meetings of the Corporate Governance Panel held on 3rd June and 15th July 2015.

……………………………………………..

In connection with Item No. 1 and upon being moved by Councillor Francis, and seconded by Councillor G J Bull, the recommendation was declared to be CARRIED.

 ……………………………………………..

In connection with Item No. 2, Councillor M F Shellens moved and was duly seconded the inclusion of the following recommendation –

that the Executive Leader and Executive Councillor be kept informed of the negotiation process for the disposals and acquisitions and the relevant Ward Councillor be informed prior to the sale.

Subject to the inclusion of the additional recommendation outlined above, it was duly moved by Councillor Francis and seconded by Councillor G J Bull the recommendations were declared to be CARRIED.

……………………………………………..

Whereupon, it was

RESOLVED

  that, subject to the foregoing paragraphs, the Report of the meetings of the Corporate Governance Panel held on 3rd June and 15th July 2015 be received and adopted.

To receive a report by the Head of Resources regarding amendments to the Council’s Constitution to reflect the requirements of the Disposal and Acquisitions Policy, as approved by the Cabinet on 18thJune 2015.

Further to the meeting of the Cabinet in June, the Panel received and noted a report (a copy of which is appended in the Minute Book) by the Head of Resources to recommend to the Council that the Constitution be amended to reflect the new Disposal and Acquisitions Policy.

As the former thresholds and procedures within the Constitution were considered too restrictive, and to enable a more commercial approach to the management of the Council’s property portfolio, a new Disposal and Acquisitions Policy and governance arrangements had been agreed by the Cabinet to enable the Authority to manage its estate of land and buildings within a commercial environment.

Having initially been considered by the Overview and Scrutiny Panel (Economic Well-Being), the Cabinet agreed to the incorporation of the following amendments to the Policy as recommended by the Overview and Scrutiny Panel:

•   where disposal and acquisition decisions are made, that these be retrospectively reported to the Overview and Scrutiny Panel (Economic Well-Being); and

•  the new financial thresholds are reviewed 12 months following approval.

It was explained to the Panel that as the Council was required to generate £8million of savings by 2019/2020 a way of generating additional income was via selling assets or purchasing capital assets within the commercial environment.

In addition to amendments to the thresholds for the disposal and acquisition of land and property, the Cabinet approved the formation of a Treasury and Capital Management Group which had to be reflected in the Constitution.

In response to questions regarding transparency of the Council’s estate, the Panel was informed that whilst the purchase or sale of property or land was under negotiation the information was commercially sensitive and was therefore confidential.  However, once contracts were complete information could be released.

The Panel enquired whether the Council had a sufficient level of expertise to realise the value of its assets and for negotiation purposes.  It was explained to the Panel that a Commercial Investment Strategy was being developed to identify such matters as well as establish proposed investment levels, risk appetite and other factors that were essential in such a strategy.

The Panel had responsibility for considering changes to the Constitution, which included the Code of Financial Management and Code of Procurement.  During the Panels discussions it was emphasised that the Policy itself was the responsibility of the Cabinet and that the report had been presented to the Panel as it was responsible for considering proposals to review the Council’s Constitutional arrangements and to make appropriate recommendations to the Council.  Purchasing and selling land and property was not a new concept to the Council and external agents were used to obtain a view on the current market values.

In response to a question it was confirmed that the Authority could purchase residential property.  However, commercial assets currently had a better value.

As a further safeguard for good governance an additional recommendation was proposed by a Member of the Panel, that the Treasury and Capital Management Group  ...  view the full minutes text for item 19

To consider a report by the Head of Resources regarding the new Disposal and Acquisition Policy: Land and Buildings and associated governance arrangements.

RESOLVED:

That the Cabinet approve the:

 i.  Disposal and Acquisitions Policy including the new monetary thresholds, subject to the inclusion of the following recommendations by the Overview and Scrutiny Panel (Economic Well-Being):

• Where disposal and acquisition decisions are made, that these be retrospectively reported to the Panel.

• The new financial thresholds are reviewed 12 months following approval.

ii.  Creation of the Treasury and Capital Management Group

RECOMMEND

To the Corporate Governance Panel that it approves all required changes to the Constitution (including the Code of Financial Management) to reflect the requirements of the Disposal and Acquisitions Policy.

The Cabinet gave consideration to a report (a copy of which is appended in the Minute Book) regarding the new Disposal and Acquisitions Policy which provided a framework through which the Council was able to manage its estate of land and buildings within a commercial environment. 

It was explained that the former thresholds and procedures within the Constitution were considered too restrictive and to enable a more commercial approach to the management of the Council’s property portfolio, a new Disposal and Acquisitions Policy and governance arrangements was recommended to the Cabinet. 

The formation of a Treasury and Capital Management Group was recommended whose functions would be:

·  Treasury Management investment decisions (including the acquisition and disposal of all types of assets);

·  the Capital Programme and undertaking of all capital development, including the approval of Business Cases;

·  comment on Treasury Management performance; and

· to call Officer’s to account in respect of performance relating to capital projects.

The Chairman of Overview and Scrutiny Panel (Economic Well-Being), having been invited to address the Cabinet, explained that there had been a good debate at the meeting regarding the governance arrangements and procedures to ensure that decisions were transparent.  The Panel had suggested recommendations which were listed within the officer’s report.

In response to a question it was confirmed that within the revised Policy purchases up to a value of £500,000 would be delegated to the Managing Director (as Head of Paid Service) and Head of Resources (as Section 151 Officer), following consultation with Executive Councillor for Resources.

The Cabinet agreed that the suggested amendments by the Overview and Scrutiny Panel (Economic Well-Being) should be incorporated into the new Policy and it was,

RESOLVED:

That the Cabinet approve the:

 i.  Disposal and Acquisitions Policy including the new monetary thresholds, subject to the inclusion of the following recommendations by the Overview and Scrutiny Panel (Economic Well-Being):

•  Where disposal and acquisition decisions are made, that these be retrospectively reported to the Panel.

•  The new financial thresholds are reviewed 12 months following approval.

ii.  Creation of the Treasury and Capital Management Group.

RECOMMEND

To the Corporate Governance Panel that it approves all required changes to the Constitution (including the Code of Financial Management) to reflect the requirements of the Disposal and Acquisitions Policy.

To consider a report presented by the Head of Resources on the Disposal and Acquisitions Policy.

  The Executive Councillor for Resources introduced the Disposal and Acquisitions Policy to the Panel.  The report precedes the Commercial Investment Strategy which will be brought before the Panel in July.

  The existing Disposal and Acquisitions system has been deemed to be too cumbersome to be efficient and amendments have been made in order to develop the Council’s estate, establishing and enhancing revenue contributions from commercial investments.  This, in turn, protects Council services in the future.

  Members were initially concerned regarding the role of Scrutiny; they were informed that Scrutiny Member involvement is encouraged as this is a collaborative piece of work.  Feedback to the Overview and Scrutiny Panel will be retrospective, due to strict rules regarding Members scrutinising decisions that they may have been involved in. The Chairman made it clear that the Panel has no opposition to this providing the decisions made are transparent.

  The Panel recommended that:

·  Where disposal and acquisition decisions are made, that these are retrospectively reported to the Panel.

·  The new financial thresholds are reviewed 12 months following approval.

In both respects the Policy attached at Appendix 1 has been updated accordingly.  Members recommended that this report is presented to the Cabinet, incorporating the recommendations made.