Meeting Details

Cabinet
11 Feb 2020 - 19:00 to 21:00
  • Documents
  • Attendance
  • Declarations of Interests
  • Visitors

Documents

Agenda

Standard Items
Also In Attendance

In accordance with paragraph 2.6(a) of the Constitution, Councillors Malcolm and Young addressed the Cabinet with regard to the following item:

Item 07 - Budget Strategy and MTFS 2020/21 to 2022/23 (Councillor Young) 

Item 08 - Budget Update 2019/20 (Councillor Young)

Item 10 - Festival and Events Policy and Contract (Councillor Young)

Item 12 - Ealing Children’s Services Ofsted Inspection of Children’s Social Care Services 4- 8 November 2019 (Councillors Malcolm and Young)

1 Apologies for Absence

Councillors Camadoo-Rothwell and Gordon.

2 Urgent Matters
There were none.

 

3 Matters to be Considered in Private

Items 9, 10, 15 and 16 contain information that is exempt from disclosure by virtue of Paragraph 3 of Part 1 of Schedule 12A of the Local Government Act 1972.

Items 9, 10, 15, 16 and 17 contained confidential appendices but were not taken in private as it was not necessary to discuss the confidential information provided.

 

4 Declarations of Interest
There were none.

 

5 Minutes
To approve as a correct record the minutes of the meeting held on 21 January 2020.
That the minutes of the Cabinet meeting held on 21 January 2020 be agreed and signed as a true and correct record.

 

6 Appointments to Sub Committees and Outside Bodies

There were none.

 

Resolved

That Cabinet:

Revenue Budget

i) notes progress against the savings target agreed by Cabinet in December 2019 as part of the budget review process for 2020/21 and recognises that as far as possible the proposals contained in the report seek to improve outcomes for residents most in need.

ii) approves net savings of £2.3m to be delivered from the General Fund, submitted as part of the 2020/21 budget review process, for 2020/21 to 2023/24 (section 5.2 and Appendix 2b of the report).

iii) authorises the Executive Director or Director with responsibility for each proposal to:

a) carry out all steps required in relation to each proposal, including carrying out any appropriate consultation;

b) consider any consultation outcomes and any other detailed implications,

c) complete and consider the implications of any equalities analysis assessment required;

d) following completion of iii) (a), iii) (b) and iii) (c) above;

i) determine whether or not to amend any proposal as appropriate prior to implementation;

ii) determine whether or not a further report needs to be considered by Cabinet or the relevant officer or portfolio holder before a final decision is taken on implementation; and

iii) where a decision is taken not to proceed with any savings proposal then alternative proposal(s) will be brought forward for consideration.

iv) in relation to those savings proposals that are significantly cross cutting across more than one council service, authorises the Executive Director or Director with primary responsibility for the savings proposal in question to complete any required equalities analysis assessments and to consider the outcome of such equalities analysis assessments, and any other cross-cutting implications, following consultation with the Executive Directors or Directors of the other services significantly impacted by the proposals, prior to taking any decisions to implement such savings proposals.

v) notes in relation to the authorisations given in iii) and iv) above that where appropriate any key decisions will be brought back to Cabinet.

vi) notes the latest Medium-Term Financial Strategy (MTFS) for 2020/21 to 2023/24 (section 4 of the report).

vii) approves £11.571m of revenue growth items for 2020/21 to 2023/24 (paragraph 5.2.2 and appendix 3 of the report) and £17.639m of capital growth (section 8 and appendix 6 of the report).

viii) )notes that the council was in a position to agree a balanced budget for 2020/21 and that any remaining budget gap following the Council Tax decision by Full Council on 25 February 2020 would be closed using reserves.

Fees and Charges

ix) approves the schedule of fees and charges for 2020/21 (paragraph 5.3 and Appendix 10).

Council Tax

x) notes the officer recommendation of an increase of 2% for the Social Care Precept and an increase of 1.99% for Council Tax in 2020/21 (paragraph 4.4.1 of the report) for recommendation to Full Council on 25 February 2020.

London Business Rates Pool

xi) notes the update regarding the new London Business Rates Pool Pilot for 1 April 2020 to 31 March 2021 (paragraph 5.10 of the report).

xii) authorises the Chief Finance Officer (Section 151) to consider and agree, following consultation with the portfolio holder for Finance and Leisure and the Leader and the Director of Legal and Democratic Services, to take on behalf of the Council any actions necessary for the Council to continue to participate in the new London Business Rates Pool.

Business Rates Discount

xiii) approves that, pursuant to the Council’s powers under Section 47 of the Local Government Finance Act 1988, for 2020/201, the Council will offer a discount in National Non-Domestic Rates (NNDR) of two times the cost of accreditation to the first 100 businesses in Ealing which are, or which become accredited with the Living Wage Foundation and who meet the criteria as set out in the February 2016 Cabinet report: Discretionary Discount Scheme for Businesses accredited to Living Wage Foundation and extend the offer to new applicants (paragraph 5.16.2 of the report).

xiv) authorises the Chief Finance Officer (Section 151) to make determinations in relation to applications for such NNDR discounts, in accordance with the council’s adopted criteria.

Schools Budget

xv) notes the outcome of 2020/21 School Funding Formula changes as agreed by Schools Forum (Section 6 of the report) and authorises the Chief Finance Officer (Section 151) to consider and, following consultation with the portfolio holder for Finance and Leisure to take on behalf of the Council any actions necessary for the Council to fulfil new requirements for Dedicated Schools Grant (DSG) budgets.

Housing Revenue Account (HRA)

xvi) notes the 2020/21 HRA revenue budget for 2020/21, as approved by Cabinet on 21 January 2020 (Section 7 of the report).

Capital Programme 2020/21 – 2024/25

xvii) notes the new General Fund capital programme additions totalling £17.639m to be approved by Full Council on 25 February 2020 (section 8 and Appendix 6 of the report);

xviii) notes the capital programme additions relating to the HRA (section 7 of the report) that were considered as part of the HRA Business Plan by Cabinet in January 2020.

Endorses and approves the following recommendations to Full Council, on 25 February 2020, that it:

xix) Revenue Budget 2020/21 and Medium-Term Financial Strategy 2020/21 to 2023/24

approves the Revenue Budget for 2020/21 as summarised in Appendix 1 of the report

  • notes the advice of the Chief Finance Officer (Section 151) on the levels of reserves and robustness of estimates in setting the budget as required by Section 25 of the Local Government Act 2003 (section 10 of the report)
  • notes the financial risks and pressures set out in the report (section 4 and section 14)
  • approves the Parking Account 2020/21 (paragraph 5.18 and Appendix 4 of the report)
  • approves the draft Schools budget of £277.713m and agrees that any changes to the budget reasonably required as a result of the final 2020/21 DSG settlement are delegated for decision to the Executive Director of Children, Adults and Public Health following consultation with the Chief Finance Officer (Section 151) (section 6 of the report)
  • approves for the Chief Finance Officer (Section 151) to agree appropriate actions to comply with the revised DSG guidance, including agreeing the appropriate Deficit Recovery plan for DSG (section 6 of the report).
  • notes that the General Fund balance is scheduled to remain the same at £15.919m for 2020/21 and notes the forecast levels of earmarked reserves (section 10 and Appendix 5 of the report).

xx) Capital Programme 2020/21 – 2024/25

  • approves the new General Fund capital programme additions totalling £17.639m (paragraph 8.3 and Appendix 6 of the report).
  • approves the revised Capital Programme of £932.480m (before additions), as set out in section 8 and Appendix 7 of the report.

xxi) Capital Strategy, Treasury Management and Pension Fund

  • approves the Treasury Management Strategy including the associated Prudential Indicators and Annual Investment Strategy (section 9 and Appendix 9 of the report).
  • approves the Treasury Management Policy Statement (Appendix 9 of the report).
  • notes the Chief Finance Officer (Section 151) will implement the Treasury Management Strategy under existing officer delegated powers (Appendix 9 of the report).
  • approves the Minimum Revenue Provision (MRP) policy (Appendix 9 of the report).
  • notes that the Council manages the cash on behalf of the Pension Fund and West London Waste Authority in accordance with the Treasury Management Strategy (Appendix 9 of the report).
  • approves the Capital Strategy (Appendix 8 of the report).
  • approves the Flexible Capital Receipts policy (Appendix 8 of the report).

xxii) Council Tax and Business Rates

  • approves officer recommendation of an increase of 2% for the Social Care Precept and an increase of 1.99% for Council Tax in 2020/21 (paragraph 4.4.1 of the report).
  • notes the Greater London Authority (GLA) Band D precept of £332.07 for 2020/21 (paragraph 5.6.2 of the report).
  • notes that the Chief Finance Officer (Section 151) calculated under delegated authority on 31 January 2020 the amount of 116,838.0 as the Council Tax Base, being the number of properties in Bands A-H in the Borough, expressed as an equivalent number of Band D units for the year 2020/21; in accordance with regulation 3 of the Local Authorities Calculation of Council Tax Base Regulations 1992 as amended made under Section 335 and 344 of the Local Government Finance Act 1992 (paragraph 5.7 of the report).
  • notes the forecast Collection Fund position for 2019/20 (paragraph 5.8 of the report).
  • notes the Council’s share of the business rates income forecast for 2020/21, as approved by the Chief Finance Officer (Section 151) (paragraph 5.9.1 and appendix 1 of the report).
  • approves charge of a 200% premium (increased from 100% extra) on top of standard tax council for properties which have been empty for more than 5 years with effect from 1st April 2020 (paragraph 5.7.7 of the report)

Reason for Decision and Options Considered

This was the final update report to Members on the 2020/21 Budget and Medium-Term Financial Strategy (MTFS). It finalised the position since the last budget strategy report to Cabinet in December 2019 and it brought together a number of significant issues for Cabinet decision. The main purpose was to enable Cabinet to consider further budget proposals and make recommendations to Full Council for when it would finalise the budget and set the council tax on 25 February 2020.

The Council had continued to invest in services that experienced significant and continued demand pressures, with prioritisation being given to the most vulnerable groups. Due to the complexity of the service provision, against the backdrop of continuing declined funding notwithstanding the indicative projected increase in funding as a result of the provisional finance settlement, these services continue to experience budget pressures.

The proposals in this report would contribute to the savings agreed in the budget strategy. Some of the savings proposals would have more detailed implications which would only emerge following consultation. Where this was the case those detailed implications would be considered before a final decision was taken on whether or not to implement the proposal, including whether or not a proposal should be amended prior to implementation. Where proposals when considered in more detail resulted in a lower financial saving, it was the responsibility of the department to find alternative savings to the equivalent value to replace the reduced amount.

Any appropriate consultation in relation to proposals would be carried out as required and in accordance with the council’s legal duties and responsibilities.

Resolved

That Cabinet:

I) notes the General Fund revenue budget forecast outturn position of £2.862m net overspend (1.16%) for 2019/20 (section 4 of the report), and a break-even position on Housing Revenue Account for 2019/20 (section 6 of the report).

ii) notes that mitigations put in place to address the forecast overspend as at period 4 have taken effect and efforts continue across the Council with the aim of ensuring the overspend is brought back within budget and further additional measures will be implemented as necessary.

iii) notes the progress on delivering the 2019/20 savings (section 5 of the report).

iv) notes the 2019/20 capital programme forecast (section 8 of the report).

v) approves the re-profiling of 2019/20 capital programme net slippage of34.975m (paragraph 8.3 of the report) into future years.

Reason for Decision and Options Considered

To forecast the financial position for 2019/20 based on available information at end of 30 November 2019. The report outlines the council’s forecasted position on revenue, capital, income and expenditure to the end of the period.

 

  1. Item 09 - CONFIDENTIAL Appendix 1 - Estimated Annual Spend
    • Information relating to the financial or business affairs of any particular person (including the authority holding that information);
  2. Item 09 - CONFIDENTIAL Appendix 2 – Contract Spend Report
    • Information relating to the financial or business affairs of any particular person (including the authority holding that information);
  3. Item 09 - CONFIDENTIAL Appendix 3 – FY 19-20 Spend Report
    • Information relating to the financial or business affairs of any particular person (including the authority holding that information);
  4. pdf Item 09 - Appendix 4 - EAA Postal Goods (1424Kb)
Resolved

That Cabinet:

i) authorises the participation in a further competition for a new contract for the provision of Postal Goods, Services and Solutions in collaboration with the London Boroughs Postal Board, led by Enfield Council via the Crown Commercial Services RM6017 Framework. The contract starting in September 2020 has an estimated value of £0.600M per annum, to be funded through the existing Post, Print and Distribution revenue budget, although this could increase during the term of the contract if additional departments make use of it. The proposed contract length is for 3 years, with two options to extend, each for a further 2 years bringing the potential full contract term to a total of 7 years.

ii) delegates authority to the Director of ICT and Property Services following consultation with the Chief Financial Officer to award a contract following the further competition to the most economically advantageous tender.

Reason for Decision and Options Considered

The London Boroughs Postal Board, led by Enfield Council will carry out a further competition under Lots 3 and 4 of the Postal Goods, Services and Solutions Framework Agreement (RM6017) established by the Crown Commercial Service.

The current preferential rates offered to Ealing are the result of economies of scale achieved by the collective procurement process carried out by the London Boroughs Postal Board consisting of 27 London Boroughs via the CCS RM1063 Framework Agreement for Postal Goods, Services and Solutions. By running a new process on its own, Ealing would have substantially less buying power and thus is unlikely to receive the discounted rates it is offered currently.

 

  1. Item 10 -CONFIDENTIAL Appendix Festivals & Events
    • Information relating to the financial or business affairs of any particular person (including the authority holding that information);
Resolved

That Cabinet:

i) approves an extension of the contract between the Council and The Event Umbrella dated 29 March 2018 for the provision of festivals and events management services ("the Contract"), for 1 year, from 1 April 2020 to the 31 March 2021 for a contract value of £0.101m to be funded from departmental budget.

ii) notes the budget realignment of £0.040m increase to £0.081m in the 2020/21 budget for Festival & Events to maintain the current level of fees and charges for park hires to community organisations. This will be achieved by managing within the overall existing budget and will be reflected as necessary in future budget rounds.

iii) approves and agrees for the 2020/21 Festival and Events fees and charges remain at the same levels of 2019/20 allowing the Council to maintain financial support next year for events including Acton Carnival, Greenford Carnival, London Mela and Hanwell Hootie.

iv) notes that a revised Festival and Events policy will be produced in line with a new Ealing Council Cultural Strategy during 2020, encompassing the three themes of the emerging Thriving Communities Strategy: Community connections and social action; participation and engagement in decision making and; catalysts – facilitating and enabling change.

v) notes that this strategy will inform future fees and charges policy, commissioning and procurement decisions for the Festivals and Events service and that the report will give recommendations regarding this.

Reason for Decision and Options Considered

TEU were contracted for i) event delivery and ii) venue administration and management of events and activities on council owned parks, open spaces and streets. The Contract commenced on 1 October 2015 and was due to end on 30 September 2019; but was extended by six months to 31 March 2020.

The Contract was procured by Ealing Council calling off from the single supplier London Borough of Richmond’s Parks and Open Spaces Framework, Lot 10 – Event Services, as the single events and festivals contractor in the London Borough of Richmond’s framework agreement for the provision of Parks and Open Spaces Maintenance Services which included Event Services in Lot 10. Calling off from the framework meant that the procurement was compliant with the Council’s Contract Procedure Rule (CPR) and the procurement rules in general.

Extending the Contract was the preferred option for two significant reasons;

This decision would cause no disruption to the existing Events and Festivals Management contract which included the delivery of the Ealing Summer Festival (Comedy, Blues, Jazz, and Acton carnival) and the delivery and support of numerous events in parks and streets including The Hanwell Hootie, the Ealing Half Marathon, Eid, cultural festivals and processions; as well as managing the existing funfair and circus programme;

to enable the production of a revised Festival and Events policy to be produced as part of a new Ealing Council Cultural Strategy in 2020/21 that recognised the three themes of the emerging Thriving Communities Strategy: community connections and social action; participation and engagement in decision making and; catalysts – facilitating and enabling change.

The option to retender at this time had been considered but ruled out to enable time for a thorough review and benchmarking exercise and for a Strategic Festivals and Events policy to be developed as part of the new Ealing Council Cultural Strategy in 2020/21.

The rationale for a new festivals and events policy was:

Festival delivery should be linked closer to audience development, including looking at an offer beyond the festival dates

There should be a framework for audience development, data collection on audience segmentation and evaluation

Festival and event activity should be closely linked to Ealing Council priorities, including new ways of working such as community empowerment

Festival programme offer should be evaluated to ascertain desirability of the festival choices

Festival and events programme should be linked to the new Arts and Culture Strategy. Initial vision is that this would more resemble a Strategy of Ealing Cultures. Festivals and Events are likely to be a major element of this idea of democracy of cultures.

Future changes to the fees and charges and new contractual arrangements for the for the Festival and Events programme would need to be considered alongside development of a new Strategic Festival and Events Policy in 2020.

The impact of any change in policy and strategy direction maybe significant and therefore, it was proposed that the Council undertook a wider consultation on any proposed changes for both the Festival and Events Programme fees and charges policy and the Arts and Cultural Strategy during 2020.

11 pdf Asbestos Framework (351Kb)
Resolved

That Cabinet:

I) notes expected 2020/21 Budgets available to facilitate the interim asbestos contract for removals and inspections are £0.750m for Housing and £0.600m for Corporate and Education sites.

ii) notes that the current boroughwide Interim Asbestos Contracts will expire on 30 March 2021

iii) authorises the Executive Director of Place following consultation with the Director of ICT (CIO) & Property Services to invite and evaluate tenders to set up a framework consisting of 4 Lots as set out in paragraph 2.3 of the report following Notification of Intention (NOI) Stage 1 Consultation with Leaseholders being completed.

iv) delegates authority to each of the Executive Director of Place, Executive Director of Adults, Children’s and Public Health and Director of ICT & Property Services to award call off contract(s) as required from the framework in accordance with the framework call off procedures during the framework term as appropriate to their service area/s.

Reason for Decision and Options Considered

Under the Control of Asbestos Regulations 2012 and other legislation and regulations, the Authority had a duty to manage asbestos within its buildings through identification, appropriate action and ongoing management including the provision of suitably qualified persons to provide specialist asbestos services.

Where asbestos containing material (ACMs) were found to be damaged and/or at risk of damage, or where building or engineering works were to be undertaken within any property (excluding those built post 2000), additional site inspections, sampling, remedial work and/or removal of asbestos materials may be required.

The existing Ealing Asbestos Framework Contract was procured in 2014. 18 contractors were appointed to manage the overall service which included Asbestos Surveys, Removal / Remediation and Air Monitoring Services, across the borough available to client departments within Ealing Council and other participating London boroughs, commencing on 16th August 2015 delivering approximately £0.250m per annum programme of works. 

The framework was a 4-year corporate contract which commenced on 16 August 2015 and was accessible by Ealing Council for work directly accountable to the Ealing Estate/Portfolio and other members of the London Contracts and Supplies Group (LCSG) via an access agreement. Other boroughs named in the OJEU advert were London Borough of Hounslow, Hounslow Homes and London Borough of Harrow.

At the end of this framework, the ongoing Options Considered were:

 

Option

Advantages

Disadvantages

I. Extend Current Framework

Continuity of service provision.

Prices are benchmarked as high. Extension for the framework would be in breach of PCRs

II. Adopt an existing framework agreement

Opportunities for significant economies of scale

Reduced contract/ supervision costs (although needs very strong client)

Available frameworks – reduced procurement cost/ time

Risk of "hidden" costs – on costs for subcontracting specialist work, high rates for individual routine jobs

Limited opportunities for local SMEs

Potential ‘loss of control’ over planning and asset management

III. Under take procurement exercise to set up a framework with 4 Lots

Opportunities for significant economies of scale

Reduced contract/ supervision costs (although needs very strong client)

Inclusive specifications and standardised approach across the council

Can be aligned to Property Consolidation and future restructures.

Long delivery timespan, additional resource required.

IV. Award to one Asbestos Management Company

One stop solution to all asbestos management issues.

Streamlined approach to procurement.

Loss of control, statutory responsibility still sits with the council. Regarded as more expensive, lack of separation between Surveying and assessing and undertaking works

Recommended Strategy

Based on the current Ealing position Option (II) (Adopt an existing framework agreement) had been used to procure interim contracts to allow enough time to implement Option III (Undertake procurement exercise) for the 2021 - 2025 Contracts.

Resolved

That Cabinet:

I) notes the outcome of the recent Ofsted Inspection of children’s social care services (ILACS) Inspection of the local authority’s services to children who need help and protection, children looked after and care leavers. The inspection found that overall, services in Ealing were requiring improvement to be good;

ii notes the inspection action plan prepared in response to the Ofsted findings has been submitted to the Secretary of State and HM Chief Inspector.

iii recommends that this topic be considered by Scrutiny in the next Municipal Year (2020-21)

Reason for Decision and Options Considered

The Ofsted ILACS Inspection was one of a cycle of inspections for Local Authorities in Ealing and Wales. This inspection gave a view on the quality of work to support and safeguard children and young people in Ealing. Therefore, the authority needed to carefully consider the inspection findings.

 

Resolved

That Cabinet:

i approves the admissions arrangements 2021/22 for Ealing community schools (Appendix 1 of the report).

ii approves the published admission numbers for all Ealing community schools including a reduction of 30 places at Willow Tree Primary School and Berrymede Junior School. (Appendix 1 of the report).

iii approves Ealing’s scheme for co-ordination of admissions to Year 7 and Reception/Junior in 2021/22 as part of Pan London co-ordination (Appendix 2 of the report).

Reason for Decision and Options Considered

All admission authorities must determine their admission arrangements by 28 February every year, even if they have not changed from previous years and consultation has not been required. These were set out in paragraph 1.46 of the School Admissions Code.

 

Resolved

That Cabinet:

i) notes the current use of RIPA in relation to surveillance and acquisition and disclosure of communications data as set out in this report.

ii) approves the updated RIPA policy at Appendix 1 and the updated Non-RIPA form attached to the policy.

iii) approves the continuing appointment of the following:

a) Helen Harris (Director of Legal and Democratic Services) as senior responsible officer (SRO) for directed surveillance, use of covert human intelligence sources, and obtaining communications data.

b) the following as authorising officers for directed surveillance and the use of covert intelligence under s.28 and S.29 of RIPA 2000 (prior to judicial approval):

? Mark Wiltshire, (Director of Safer Communities & Housing)

? Mike Pinder (Head of Audit and Investigations)

? Jackie Adams (Head of Legal (Commercial)

iv) authorises the Director of Legal and Democratic Services to:-

a) make any further necessary amendments to the RIPA Policies which are necessary to maintain consistency with legislation, Codes of Practice, good practice and

b) make any necessary changes in authorising officers, and

c) review the authority’s procedures, policies and training on a quarterly basis.

v) notes that the Investigatory Powers Commissioners Office "IPCO") is scheduled to carry out a further inspection visit on 14 May 2020.

Reason for Decision and Options Considered

There was a requirement in the Codes of practice that members were to be kept informed about the Council’s use of powers under RIPA and that Cabinet approves a policy for the use of directed surveillance.

  1. Item 15 - CONFIDENTIAL Appendix 1 - Sales Agent Contract Tender Report
    • Information relating to the financial or business affairs of any particular person (including the authority holding that information);
  2. Item 15 - CONFIDENTIAL Appendix 2 - Copley 6 Shared Ownership and Market Sale Values
    • Information relating to the financial or business affairs of any particular person (including the authority holding that information);
Resolved

That Cabinet:

i) authorises the award of a contract to Jones Lang LaSalle Limited to the value of (as adjusted) £0.500m for a term of 4 years with no option to extend.

ii) authorises the Executive Director of Regeneration and Housing to set aside a client contingency sum of £0.050m, this being appropriate for the contract sum and risk profile of the project.

iii) The total cost for this services contract was therefore £0.550m. This would be funded from the approved Copley Close Capital scheme budget. £1.216m had been earmarked for sales and marketing activities from within the approved scheme budget. Further detail was provided in Financial Implications Section 4 of the report.

iv) approves the sale of units outlined in paragraph 2.4 of the report and detailed in Confidential Appendix 2 of the report.

v) agrees to delegate the varying of sale values as required following formal valuation to the Director of Housing Development, together with the offering of incentive packages that may be required in order to ensure the sale of properties proceeds in a timely manner.

vi) agrees to delegate the varying of leases at Warwick Court to the Director of Safer Communities and Housing following consultation with the Director of Legal and Democratic Services.

Reason for Decision and Options Considered

A report to Council’s Cabinet on 16 February 2016 outlined the future direction of the delivery of the Copley regeneration programme, splitting the project into seven distinct phases.

A further report to Council’s Cabinet on 18 June 2019 approved the award of a tender to Hill Partnerships Ltd to undertake the construction of 201 new homes as part of phase 6 of the Copley scheme, together with a brand new community square, upgraded open spaces and play area, commercial/retail space and a new community centre.

Work to construct the new homes started on-site in October 2019, which would be subject to handover in three sub-phases between September 2021 and March 2022.

This report principally requested the authority of Cabinet to award a contract to a sales agent to undertake all sales and marketing activities in order to sell a total of 81 new homes at the Copley phase 6 development, 33 of which would be available on a shared ownership basis and 48 of which would be offered for open market sale.

Whilst Cabinet in February 2016 authorised the Executive Director of Place, following consultation with the Director of Legal and Democratic Services, to invite tenders and award contracts for all future works at Copley, the tender sum for this service required specific Cabinet approval under the Council’s Contract Procedure Rules and Council Constitution.

Given the importance to the Council of ensuring the successful sale of the homes at Phase 6, and the potential costs of having standing stock, a particularly strong emphasis was placed on the quality of bids in the selection criteria.

A full breakdown of the of the 81 properties to be sold, together with estimated sale values, is shown at Confidential Appendix 2 of the report. No less than six weeks prior to marketing commencing, grant regulations stipulate all shared ownership properties be valued according to the Royal Institute of Chartered Surveyors ‘Red Book’ methodology. A similar valuation of the open market homes would also be undertaken, and discussion with the appointed sales agent will then set the exact values at which the new homes for outright sale would be marketed.

To allow prevailing market conditions to be reflected when setting sale values, and flexibility for the sales agent to negotiate with purchasers and offer incentives should the market require them, recommendation 1.5 in the report delegated such authority to the Director of Housing Development.

Phase 6 of the Copley regeneration programme was being carried out in tandem with phase 3. Phase 3 comprised the total refurbishment of 18 existing homes at Warwick Court, together with the construction of three new flats for social rent.

Authority was sought to delegate the varying of leases of the five existing leasehold flats to the Director of Safer Communities & Housing (following consultation with the Director of Legal & Democratic Services) in order to reflect changes to the homes as a result of the refurbishment of the block.

  1. Item 16 - CONFIDENTIAL Appendix 1 - Commercial Strategy
    • Information relating to the financial or business affairs of any particular person (including the authority holding that information);
Resolved

That Cabinet:

i) agrees that the Electrical Installation and Upgrades Contracts with Wigginton dated 2 June 2016 is extended for four years in accordance with the contract terms from June 2020 to May 2024.

ii) agrees that the Electrical Maintenance and Minor Works contract is broken down into separate disciplines and re-procured for two-year terms from April 2020 to March 2021. The short contract term is proposed for two reasons:

  • The potential for Housing Assets and Property to deliver more work in-house over the next few years.
  • A number of Facilities Management/Property Services contracts end at the end of March 2022; two-year terms would align the end date of the Housing contracts with the FM contracts and present an opportunity for some cross-Council joint procurement.

iii)) agrees that authority is delegated to the Director of Place to evaluate tenders and award contracts; further to the Electrical Maintenance and Minor Works contracts re-procurement.

iv) The type of contracts to be used will be JCT Measured Term Contracts and the procurement process will be through frameworks.

v) The Electrical Installation and Upgrades contract extension for four year is to be funded by the approved Housing stock improvement budget. The Electrical maintenance and Minor works contract re-procurement for two years is to be funded by the approved Housing stock improvement budget and the approved repairs and maintenance revenue budget. The appropriate budgets would be allocated from within the approved Housing stock improvement budget and the Repairs and Maintenance revenue budget.

Reason for Decision and Options Considered

The options considered were as follows:

Electrical Installations and Upgrades contract

The following options were considered for the Electrical Installations and Upgrades contract:

Extend the existing contract with no changes

Extend the existing contract but put in alternative arrangements for materials procurement in order to reduce cost to the Council.

Re-procure the existing contract

Option 2 was selected on the basis that the contractor’s performance has been good but some improvements could be made to improve Value for Money.

Electrical Maintenance & Minor Works contracts

In-house delivery of the requirements was considered; however, this was not currently a viable option as there was not a trained resource within the service to undertake electrical maintenance and minor works. 

A further options appraisal was undertaken to determine whether it would be better Value for Money to re-procure all required services under one contractor; or to split the contract into smaller specialist disciplines. The preferred option was to split the contract into smaller specialist disciplines. The rationale was set out in more detail at Appendix 1 of the report.

In recognition of the lessons learned through the administration of the current electrical maintenance contract and other similar maintenance contracts within the housing service, the following changes would also be adopted at the time the new contracts are procured:

Form of contract. A return to the use of forms of contract which were more common within the sector and reflect the lower overall values of the smaller contracts now being let.

Contractual relationship. Recognising that the use of partnering-type contracts may not be appropriate for all of the contracts let, particularly those with a lower overall value, that were not complex and were predominately transactional in their nature.

Cost model. To reflect the savings generated through the direct purchase of materials through the PfH framework and the renegotiated direct manufacturer pricing for some items, officers would seek to make contract finance more transparent. This would include a move away from gain-share contracts in some areas and a return to an output based model with more competitive pricing from commencement.

A review of the schedule of rates model for larger projects and adoption of alternative pricing mechanisms where these would deliver better value and reduce administration.

  1. Item 17 - CONFIDENTIAL Appendix I - Financial Model (Jan-20)
    • Information relating to the financial or business affairs of any particular person (including the authority holding that information);
  2. Item 17 - CONFIDENTIAL Appendix II - Interim Property Aquisition Programme Jan-20
    • Information relating to the financial or business affairs of any particular person (including the authority holding that information);
Resolved

 

That Cabinet:

 

i) notes the outcome of the Housing and Homelessness Outcome Review summarised in paragraph 2.1.6 and 2.1.7 of the report setting out the ambition for acquisition of up to 300 units including the proposal as part of this report, as an alternative to units procured through the existing Private Sector Leasing (PSL) scheme.

ii) agrees an interim proposal to deliver a proportion of the units (approximately 58) pending the development of a longer-term proposal to acquire the remainder.

iii) delegates authority to the Director of Housing and Safer Communities to acquire approximately 58 properties, for the purposes of Temporary Accommodation, subject to the price ceiling values set out in the Business Plan (Confidential Appendix I of the report).

iv) incept a new Capital Programme item called Temporary Accommodation acquisition (phase 2) at a value of £23.110m to be funded from £10.500m Flexible Homelessness Support Grant and £12.610m from prudential borrowing.

v) approves the use of up to £12.610m of prudential borrowing, the revenue costs of which were to be covered within the existing Temporary Accommodation and Housing Benefit Subsidy shortfall revenue budgets

vi) approves the use of up to £10.500m in grant funding to support acquisitions under this framework, of which £5.000m is already included in the current capital programme.

vii) delegates authority to the Director of Housing and Safer Communities to expend Right to Buy (RTB) Receipts, if appropriate, in place of any combination of the Capital Funding and Flexible Homelessness Support Grant allocated in consultation with the Chief Finance Officer (Section 151).

Reason for Decision and Options Considered

Between 2011 and 2019, the number of households in temporary accommodation (TA) more than doubled, primarily due to changes in the Local Housing Allowance (LHA) system which reduced the purchasing power of low-income households in Ealing’s private rented sector.

This was evident from P1E statistics that record the ‘main reason for loss of last settled home’. In the last quarter of 2010/2011, 13% of households presented to the authority due to the end of an Assured Shorthold Tenancy. In comparison, 49% of cases were recorded as such in the last quarter of 2017/2018. Following the introduction of the Homelessness Reduction Act, there have been changes to the way in which this data was reported. While the statistics were no longer therefore, directly comparable, the trend had continued.

The number of households in temporary accommodation had stabilised in more recent years as the council had successfully reduced the number of households coming into the system through enhanced homelessness prevention. Indeed, MHCLG statistics indicated that Ealing was one of the best performing local authorities in the country, achieving the 3rd highest number of preventions across London between January 2018 and March 2019.

Nonetheless, the cost of providing temporary accommodation was an ongoing financial pressure for the council because housing benefit subsidy rates have remained static at 90% of Jan-2011 LHA rates despite increases in the price that must be paid to secure accommodation.

The Council undertook an Outcome Review of the Housing and Homelessness Function in 2018. That in depth review proposed four key interventions:

Reducing demand for TA through enhanced homelessness prevention work;

Increasing the supply of cost-neutral hostel/modular accommodation as an alternative to Bed and Breakfast accommodation;

Increasing the supply of cost-neutral longer-term accommodation, sitting outside of TA subsidy arrangements, as an alternative to units procured through the Private Sector Leasing (PSL) scheme.

Increasing moves into permanent accommodation.

The recommendations contained in this report related to the delivery of the third of those key interventions, namely the provision of cost-neutral longer-term accommodation. The Outcome Review proposed the acquisition of 300 new such units - 30 in 2019/20, 240 in 2020/21 and a final 30 in 2021/22.

In September 2013, the Council authorised the acquisition of up to 83 properties on the open market, funded through £21.000m of prudential borrowing. Whilst some of the units acquired were ‘early buybacks’ on Council estates undergoing regeneration, the majority of these properties continued to be held in the General Fund and were rented to homeless households on non-secure tenancies. Under housing benefit rules, these claims were not subject to subsidy caps and are eligible for 100% subsidy up to the level of rent.

In May 2016, Cabinet authorised a further £5.000m to be added to the capital programme to secure up to 20 properties additional properties. However, it had been challenging to identify a sufficient number of properties within the agreed price ceilings.

In October 2016, a financial evaluation of the original scheme was commissioned. The report confirmed that the rental income generated from the portfolio had been sufficient to meet running costs and interest payments.

Options Considered

Providing cost-neutral units was challenging given that both house prices and rents in Ealing and surrounding areas were high relative to residents’ ability to pay and given the ongoing constraints on benefits and allowances.

A number of options were being considered in relation to a wider programme of acquisitions (aiming to deliver 300 new Temporary Accommodation Units) however it was recognised that programme would take time to establish.

Officers therefore considered a number of options for an interim programme of acquisitions that would deliver a smaller number of new temporary accommodation properties, utilising the tools already available to the Council, that could commence more immediately. The options considered were set out in detail in the Business Case (Confidential Appendix I of the report).

In brief those options were;

Option 1: Do Nothing – Discounted - No new properties would be acquired until the long-term approach was finalised with no revenue savings delivered in 2019-20.

Option 2: Establish a wholly grant funded framework for acquisitions – Discounted - Grant funding would have a reduced impact when compared to option 3.

Option 3: Establish a part Council capital, part grant funded framework for acquisitions - Recommended

Option 4: Establish a wholly Council Capital Funded framework for acquisitions – Discounted - This would fail to deliver cost-neutral temporary accommodation properties.

The Recommended Option

A part Grant, part Council capital funded framework for acquisitions (Option 3) was recommended.

In order to deliver ‘cost-neutral’ units in respect of Option 3 it was proposed that Council capital funding be utilised only to the level supported by the assumed rents net of management costs. Beyond that level grant would be deployed to provide funding up to the given ceiling prices.

While the framework proposed would not, with the levels of grant funding currently identified, deliver 300 cost neutral units. It should deliver in the region of 58 and deliver those 58 quickly, over the course of the 2020/21 financial year.

A part grant, part council capital, funded programme maximises the number of units acquired for the provision of temporary accommodation, improving the offer for the maximum number of homeless households possible. Those households would benefit from improved accommodation, suitably located and to a suitable standard with management and maintenance obligations fulfilled directly by the Council.

In order to maximise the reduction in the net cost of temporary accommodation it was proposed that allocations to the newly acquired temporary accommodation were targeted at the current high cost cases. In doing so, the revenue benefit to the Council was maximised.

The Future Opportunity

Officers were continuing to work on a business plan designed to provide the 300 cost-neutral units called for by the Outcome Review. However, it was recognised that this would require a necessarily more complex and innovative solution.

It was anticipated that a proposal to deliver a broader programme would be presented to members for consideration later this year. There was, however, a more urgent need to provide Homeless Households in Ealing with more suitable Temporary Accommodation and deal with the ongoing revenue pressure.

While the Council was proposing to deploy a high level of grant on a relatively small number of properties, the programme had been designed such that if appropriate, at a later date, the properties acquired could be incorporated within a broader programme through which the Council would achieve better value for money overall.

The wider programme currently envisaged would seek to re-finance the properties acquired under this proposed framework with the Flexible Homelessness Support Grant released back to support further homelessness initiatives.

18 Date of Next Meeting
The next meeting will be held on 17 March 2020.
That Cabinet:

 

notes that the next meeting of Cabinet would be held on 17 March 2020 at 7pm

 

Paul Najsarek, Chief Executive, 3 February 2020

 

 

 

Councillor Julian Bell, Chair

 

Date

The meeting concluded at 7:26pm having completed its business.

The minutes should be read in conjunction with the agenda for the meeting. They are subject to approval and signature at the next meeting of this Committee.

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