Agenda item

The Director of Environment and Regeneration, Kevin O’Leary, was present and was accompanied by the Assistant Director Environment and Regeneration, Bram Kainth and Martin Holland, Head of Service, Highways Service, Environment and Regeneration, who presented witness evidence to the Committee.

A presentation was also made to the Committee, a copy of which is interleaved.

During consideration of the SID and the witness evidence the following main points were made -

·         The Chair stated that it had been agreed that items 4 and 5 of the Scrutiny Initiation Document should be deleted and that the issue of compensation payments would now be dealt with as a separate issue at the November meeting

·         Budget pressures had resulted in the need to identify new methods of generating income

·         There had been recent work to investigate opportunities to trade and engage in commercial activity – whilst commercial activity exists across the organisation most is focused in E&R

·         There was no clear co-ordination of all the work taking place around raising commercial revenue for the Council

·         A Commercial Board was set up in November 2013 to promote and increase commercial thinking across the Council – the remit of the Board is to understand the position of commercial activity taking place across the Council, review the Council’s approach to trading services, understand common barriers to implementing commercial opportunities and determine the most appropriate vehicle for commercially orientated services

·         The programme looked at a range of opportunities and found the following to be good examples of where progress could be made quickly and viably – Commercial Portfolio – redevelopment/refurbishment, wireless concession significant opportunity, refreshed approach to commercial waste now contract in house including creation of a business portal, advertising and sponsorship- possible planning issues, Planning and Development- duty planning consultancy, Film- Islington as a location and Energy Consultancy exploiting the Council’s expertise. The measures have resulted in the programme contributing £1.4m in revenue receipts per annum to the medium term financial strategy

·         Key challenges were – lack of staff resources, risk averse culture and lack of commercial skills, awareness of the Council’s ability to trade, recruitment policy which can be lengthy and not adaptable if required, and slow response to support services

·         In terms of current activity the work programme included – maintaining central oversight of all commercial opportunities across the Council to ensure strong governance, pro-actively engaging with services to identify opportunities which could potentially generate income, provide a forum which commercial activities can be presented, developing a framework that ensures decisions to trade are undertaken with a clear understanding of the sector or market, understanding key barriers and making recommendations to overcome/mitigate them

·         There is a need to ensure Islington core services come first and cannot be compromised

·         The new trading company will be registered in October 2014 and will provide flexibility in selling new and existing services to different markets. Highways and Energy consultancy will be the first service placed in the new trading arm

·         The Commercial Board will act as a clearing house for ideas and opportunities that sit within it- this will be before Trading Company approval – the Trading Company consists of Councillors Hull and Webbe and officers

·         A Member expressed concern that the Council needed to be careful with its approach to proposals for issuing planning advice and to avoid accusations of impropriety. The Director of Environment and Regeneration responded that planning advice was already given to applicants for major applications but there was a need to ensure structures were in place to avoid this

·         In response to a question it was stated that the proposal for a Private Lettings agency was more about ensuring social housing and temporary accommodation was more available

·         There would be staff involvement with the  proposals following the creation of the Trading Company

·         It was stated that there were different models for running Trading companies and that the prime responsibility of Council staff would be to core services and that existing staff would be utilised in maximising income in the first instance

·          In response to a question it was stated that it was recognised that the Council would not wish to engage consultants in the process. There would need to be a cultural shift and discussions were taking place determine the best Trading Company model that would be most beneficial to the Council

·         The Council already worked with partners to offer advice and services

·         In regard to advertising it was stated that there needed to be an equitable agreed policy in relation to this

·         The view was expressed that the Council should not be exposed financially as a result of the Trading Company’s activities and it was important to identify opportunities that suit the Council both as an organisation and financially. It was stated that the Commercial Board would look at options and ensure robust monitoring

·         Members were informed that there were ‘filter systems’ in place at the moment and there was a need to ensure that any income maximisation proposals were not detrimental to core Council services

·         In response to a question as to whether there should be subsidiary contracts to minimise risk and whether the Council had officers that could deal with contracting,  it was stated that there was significant experience in E&R in relation to contracting and that this was seen as Council strength rather than a weakness

·         The Council can assist contractors and consultants in the type of information needed that would enable them to win contracts and this had recently happened with a contractor bidding for work in Westminster

·         Councillor Hull stated that the Executive welcomed the scrutiny into income maximisation and that an additional areas could be looked at in relation to estate cleaning/caretaking services and the repairs service, Telecare, commercial use of parks, looking at Council Tax for student accommodation in non term time and the Partnership team and Property Services needed to be involved in the commercialisation of services

·         In response to a question it was stated that the Council owned and operated a CCTV network across the borough with a central point at 222 Upper Street and that income could be obtained by renting out services to telecommunications companies

·         It was stated that there needed to consideration given to the barriers that prevented the Council from maximising income such as the speed/agility of the organisation to respond and deliver and streamline the service, increased flexibility, and to look at varying procurement and recruitment regulations to employ staff more speedily

·         In response to a question from the Chair it was stated that the Committee would be provided with witness evidence from a selection of witnesses such as other Local Authorities/Council officers as to options for income maximisation

RESOLVED:

(a)  That the scrutiny initiation document be agreed, with the exception of items 4 and 5, which should be deleted and further witness evidence be taken at the next meeting with a view to presenting draft recommendations to the December meeting

(b)  That the suggestions put forward by Councillor Hull be considered during the scrutiny process

DER