Agenda item

Cabinet noted that this report had not been notified for inclusion on the agenda within the statutory deadline.  The Chairman agreed to accept the item as a matter requiring urgent consideration in order that a decision on the way forward could be made without delay.

The Chairman stated that the report had been considered at Cabinet (Housing) Committee and The Overview and Scrutiny Committee at their meetings on 20 March 2019 where Members had supported the proposals.  In addition, the proposals had been supported by TACT.

The Strategic Director: Services (Interim) advised that the proposal was for a relatively straightforward model of company which had been developed following discussions with other local authorities.  It would enable the Council to develop alternative housing tenures which could not currently be provided within the Housing Revenue Account.

One Member expressed concern that with only one Member appointed to the Board, Members would not have overall control over decisions.  The Strategic Director commented that it was unusual for companies to include any Member representation on the Board as their input was by being a shareholder.  In addition, it was recommended that a Shareholder Advisory Group be established.

The Chairman emphasised that the proposal was for a further report to be submitted for approval once additional legal advice had been obtained.  In addition, the Strategic Director highlighted that in the future, the Council might look to establish additional housing company(ies) to pursue a wider selection of possibly larger developments. 

Cabinet moved into exempt session to consider the contents of the exempt appendices to the report before returning to open session to agree the recommendations as set out below.

Cabinet agreed to the following for the reasons outlined above and set out in the Report.

RESOLVED:

1.         That the proposal to establish a company limited by shares and wholly owned by the Council to deliver and manage sub market rented and shared ownership accommodation, including the partnered home purchase scheme (PHP)  be approved.  A further report will be made to Cabinet and Council before a final decision is made to establish the company and start trading.

2.         That a combined loan facility & equity shareholding of £10m from the General Fund be approved  to support the company’s development activity.. This was previously approved in CAB2990 (HSG) 22 November 2017 as a £10m loan facility only. 

3.         That the five year business plan be approved.

4.         That the Corporate Head of Housing in consultation with the Corporate Head of Resources, the Leader with Portfolio for Housing Services and the Portfolio Holder for Finance be authorised to:

a)    Determine the balance of commercial and other loans to equity with due regard to state aid regulations.

b)    Determine the terms of all loans.

5.   That the proposed governance structure be approved, and:

a)    Full Council assumes the role of shareholder of the company.

b)    A Shareholder Advisory Group of three elected members of the Cabinet Housing Committee be established to advise the Council in its capacity as shareholder with senior officers to attend as required.

c)    That the appointment of one elected member and two senior officers to the board of directors, namely The Chair of the relevant Policy Committee, The Corporate Head of Housing and the Head of New Homes Delivery, be approved.

6.         That delegated authority be given to the Chief Executive in consultation with the Leader with Portfolio for Housing Services to appoint additional independent directors at a future date should the need arise.

7.         That authority to finalise the articles of association and shareholder agreement be delegated to the Corporate Head of Housing in consultation with the Legal Services Manager, the Leader with Portfolio for Housing Services and external legal advisors.

8.         To ensure that the company is able to commence trading from October 2019, that authority to undertake all remaining steps detailed at table 5 be delegated to the Corporate Head of Housing in consultation with the Legal Services Manager and Leader with Portfolio for Housing Services.