Agenda item

RECOMMENDATION:

It is recommended that Scrutiny Committee comment on the proposals within the attached cabinet report, ref CAB3565, which is to be considered by Cabinet at its meeting on 25 August 2026.

NOTE

This report contains an exempt appendix (Appendix 1), if members wish to discuss any part of this exempt appendix, then the procedure under agenda item 6a (below) applies.

The Chairperson invited the members of the public and visiting councillors to address the committee, and a summary of their comments were as follows.

1. Ian Tait addressed the committee. He supported the proposals but questioned the provision of limited parking, suggesting that city centre residents could live without cars. He noted local opposition and emphasised the need for community and ward councillor support, referencing past failed schemes and questioned whether the council should manage the project or seek alternative delivery routes.

2. Lin Mellish addressed the committee. She expressed a preference for council housing with social rents rather than affordable housing, noting that the original intention was for council homes. She stated that the lack of parking would make the homes difficult to let due to unreliable public transport and suggested that displaced vehicles would increase traffic, concluding that whilst she wants homes, we need car parks and this the car park should remain.

3. Councillor Stephen Godfrey addressed the committee. He highlighted three risks: the potential for cost overruns on the design budget making the homes unaffordable, the displacement of current car park users and the lack of alternative spaces, and the risk of flooding on the site, noting a previous failure to build a school there for that reason.

4. Councillor Danny Lee addressed the committee. He supported the use of the brownfield site for affordable housing but questioned the financial assumptions, asking for quantified evidence regarding displaced parking revenue. He sought clarification on the uncommitted balance of Section 106 affordable housing funds, the actual available and eligible funds, whether the expenditure would be released in stages, the value for money of the design and build contract, and the risk of abortive expenditure given Local Government Reorganisation and suggested to accelerate the project or provide an additional gateway decision point in order to minimise this risk.

Councillor Mark Reach, Cabinet Member for Good Homes introduced the report, ref CAB3565, which set out proposals regarding expenditure for professional fees to develop the scheme. The introduction included the following points:

1. The report sought a capital expenditure of £480,000 for professional fees to develop the scheme, which contributed to the target of 1,000 affordable homes by 2032.
2. The site was included in the Local Plan for housing, and the current proposal aimed to deliver approximately 44 homes, consisting of one and two-bedroom flats and three-bedroom townhouses.
3. The site was sustainable, though groundwater and flood risks required assessment during the pre-planning stage.
4. The reduction of city centre parking aligned with council strategy, and alternative parking provision was available nearby and at park and ride sites.
5. The tenure type was yet to be finalised, but he believed that there was an opportunity to deliver social housing and shared ownership units.

The Chairperson suggested that the Committee consider the following points during discussion on the item:

1. That the principle of residential development on the site was established through the adopted Local Plan.
2. That the committee was not being asked to approve construction, but rather to scrutinise the next stage of work, including surveys, design, and planning application preparation.
3. That the committee should consider the overall financial position, the impact of displaced parking on council finances, and key delivery risks such as flooding, archaeology, and ground conditions.
4. That the final business case would be considered in the context of local government reorganisation, requiring the proposed work to provide sufficient information for a future authority to make an informed decision.

The committee was recommended to comment on the proposals within the attached report, ref CAB3565, which was to be considered by cabinet at its meeting on 25 August 2026. The committee proceeded to ask questions and debate the report. In summary, the following matters were raised:

1. A question was asked regarding the £480,000 expenditure and how members could be satisfied it was proportionate when no overall financial business case was provided. A further question was asked whether the £480,000 would be released through defined project gateways and if members would have an opportunity to review progress before the full amount was committed.
2. A question was asked regarding the strategy and criteria used to bring sites forward, and the decision process, as it was understood that this project was not on the list at the July Cabinet Housing Committee. A further question was asked if the decision criteria could be provided to members.
3. Further clarification was sought regarding viability costs, in relation to biodiversity net gain (BNG), public realm maintenance, security risks, and ventilation in the flats.
4. A question was asked about how the transfer of the site from the General Fund was assessed and whether the potential increase in site value upon receiving planning consent was included in the viability assessment.
5. Further clarification was sought on what controls, milestones, and reporting arrangements would be in place to ensure value for money and limit abortive expenditure.
6. A question was asked regarding flooding in the area, specifically water coming up through the drains, and whether the budget for initial investigations was sufficient to cover this issue.
7. Clarification was sought regarding the justification for increasing the proposed units from 30 in the Local Plan to 44, and whether there would be further consultation with residents. Further to this, it was asked if this point could be taken back to the planning cabinet member.
8. A question was asked regarding what assurance could be provided that the £480,000 would not be wasted if a successor council decided not to take the scheme forward following local government reorganisation.
9. It was asked whether it would be acceptable to implement stage payments for the fees to manage risks.
10. Clarification was sought as to why the land was not part of the Housing Revenue Account (HRA) at the time it was originally identified for social housing.

11. Further information was requested regarding how the financial figures in the exempt appendix were constructed and whether there was input from professionals.
12. A question was asked regarding parking and deliveries, and how delivery drivers and carers would be accommodated given the lack of parking on site.
13. Further information was asked about housing need, and whether the model of provision matched the need for central Winchester accommodation, including for one-bedroom households.

The committee agreed to move into an exempt session to consider the exempt appendix, during which further questions were raised which included the following: public rights of way and flooding considerations, professional survey fees, HRA borrowing limits and assurance regarding budget estimates, the inclusion of archaeology costs, and a request for a project plan that would highlight key points and expenditure.

These points were responded to by Councillor Mark Reach, Cabinet Member for Good Homes, Councillor Martin Tod, Leader and Cabinet Member for Asset Management, Simon Hendey, Strategic Director, Liz Keys, Director (Finance) and Caroline Egan, Service Lead New Homes Delivery accordingly.

RESOLVED:

That the committee supported further investigation of the site for affordable and social housing and agreed to request that the following points be considered by cabinet:

a)    That the final business case sets out the total estimated development costs, the valuation and transfer arrangements relating to the site, all funding sources, subsidy requirements, expected rental income, borrowing requirements, the impact on HRA borrowing capacity and long-term HRA business plan sustainability, and sensitivity analysis for key risks.

b)    That the final business case provides an assessment of the impact on parking provision, parking income, and any consequential effects on the general fund.

c)    That the final business case includes an assessment of site-specific risks identified through the investigation phase, including archaeology, groundwater, flood risk, contamination, and any associated mitigation measures, together with an explanation of the impact of those risks on scheme viability, affordability, and delivery timescales.

d)    That cabinet receives a decision point before the planning application is submitted, setting out estimated development costs, funding sources, and subsidy requirements, together with decision gateways at which the continuing viability and affordability of the scheme can be reviewed before further expenditure is committed.