Agenda and minutes

Finance, Commercial Revenue and Contracts Policy & Accountability Committee - Thursday, 23rd July, 2020 6.30 pm

Venue: Online - Virtual Meeting. View directions

Contact: Kayode Adewumi 

Link: View live stream on YouTube

Items
No. Item

1.

Minutes pdf icon PDF 355 KB

To approve as an accurate record, and the Chairman to sign the minutes of the meeting held on 29 January 2020.

Minutes:

The minutes of the meeting held on 29 January 2020 were approved and signed by the Chair.

 

The Chair requested that the responses to the outstanding actions be resent to Members.

 

The Committee noted that Hitesh Jolapara, Strategic Director of Finance and Governance had recently left the Council. The Chair requested that his thanks and the Committee’s appreciation be put on record for all his hard work over the years.  The Committee noted that they had developed a good relationship with him, and he'll be missed.  Members welcomed Emily Hill, Director of Finance to her new role.

2.

Apologies for absence

Minutes:

There were no apologies for absence.

3.

Declarations of interest

If a Committee member has any prejudicial or personal interest in a particular item they should declare the existence and nature of the interest at the commencement of the consideration of that item or as soon as it becomes apparent.

 

At meetings where members of the public are allowed to be in attendance and speak, any Councillor with a prejudicial interest may also make representations, give evidence or answer questions about the matter. The Councillor must then withdraw immediately from the meeting before the matter is discussed and any vote taken unless a dispensation has been obtained from the Standards Committee.

 

Where Members of the public are not allowed to be in attendance, then the Councillor with a prejudicial interest should withdraw from the meeting whilst the matter is under consideration unless the disability has been removed by the Standards Committee.

Minutes:

There were no declarations of interest made.

4.

Financial Impact of COVID-19 on the Council pdf icon PDF 328 KB

This report provides a review of the council’s financial position as it seeks to support our residents, communities and businesses through the Covid-19 pandemic.

Minutes:

The Chair noted that the Council had moved a motion at the last Full Council meeting calling on the Government to honour its promise and reimburse councils across the country the full financial cost of the COVID-19 crisis.

 

Emily Hill, Director of Finance, noted that rigorous and precise forecasting regarding the impact of Covid-19 was not possible as new issues and challenges were arising at pace with several key variables unknown.  She updated the Council’s high-level modelling summarised in Table 2.

 

Table 2 – Financial impact of Covid-19 on Hammersmith and Fulham (June MCHLG Return)

 

 

£m

Expenditure

14.430

Income loss (fees and charges and commercial)

16.218

Income loss (council tax and business rates)

7.900

Total expenditure and income loss

38.548

Un-ringfenced emergency Covid-19 grant

(13.507)

Additional un-ringfenced grant and partial compensation for income loss (July 2 MCHLG announcement)

8.687

Grant shortfall

16.354

Housing Revenue Account element of shortfall

2.369

 

She observed that our expenditure and income loss based on the current understanding was far from being fully funded.  There is a £16million shortfall.  In terms of fees and charges, the Government is expected to compensate for 75% income loss (above a 5% threshold).  This excluded council tax and business rates which estimated a £7.9m loss. The actual cash loss will be significantly higher but part of this will be met by the Greater London Authority and Government. The Government had announced that this loss can be spread over 3 years from 2021/22 onwards.

 

A one-year local government finance settlement will be issued for 2021/22.  There is no commitment by the Government as to what funding will be made available and no clarity over timescales. There is ambiguity over the Government’s funding plans in both the short and long-term as other expected local government funding reforms have also been delayed, including business rates reform and social care funding.

 

The Committee noted that the Government grant allocations are split between: -

 

1.      general grant allocations to help deal with the immediate impacts of Covid-19. The funding is un-ringfenced and available to help meet any financial pressures experienced by the Council (including income loss). The Council has received 2 tranches of this funding (emergency Covid-19 grant) that total £11.535m. A further additional tranche of £1.972m was recently confirmed. 

2.      grants that are ringfenced or intended for specific purposes such as test and trace grant.

3.      funding that is shared with other partners. For example, £1.5 billion nationally has been allocated to the NHS for additional spending on enhanced hospital discharge arrangements. The Council has made 3 claims to date but no response has been received yet.  Any funding received will help reduce the deficit.

 

It was noted that COVID-19 and any economic downturn will have an impact on our services, increasing the demand in the medium and long term.  It is looking at expenditure where we can apply specific grants. 

 

Tony Boys noted there was a £12 million shortfall in parking income.  Judith Worthy asked had the Council reviewed its spend on transport  ...  view the full minutes text for item 4.

5.

Civic Campus Update pdf icon PDF 841 KB

This report provides the Committee with an update on the Civic Campus Programme – the redevelopment of Hammersmith Town Hall and West King Street.

 

This report has appendices containing information exempt within the meaning of Schedule 12A to the Local Government Act 1972 and are not for publication.

 

Any discussions on the contents of an exempt appendix will require the Committee to pass the proposed resolution identified at the end of the agenda to exclude members of the public and the press from the proceedings for that discussion.

 

Additional documents:

Minutes:

Dave Burns, Assistant Director (Growth) gave an update on the Civic Campus.  He noted that the programme was developing as planned.  The revenue element of the budget was currently forecasting an underspend and status remains as per previous report.  Controlled demolition of the Town Hall extension commenced in June 2020 and will take 4-5 months to complete (end of October 2020).  This is a later start than the original programme due to delays from Covid-19 and a reduced labour force as a result of required social distancing. However, this will not impact the main works programme as the demolition contractor has been able to re-programme elements of the work, and the proposed main contractor Ardmore has also integrated the demolition programme into their overall programme without the need for a delay.  The CCTV equipment on the ground must be moved out soon.

 

The Joint Venture (JV) was incorporated on the 4th March 2020.  The Limited Liability Partnership (LLP) Agreement and the Conditional Agreement for Lease (CAL) were both signed on the 31st March 2020.

 

In terms of governance and programme management, the progress of the project is monitored and scrutinised by several formal boards which include the Executive Board chaired by the Chief Executive.  This board meets monthly to review progress and budget control.   The Programme Delivery Group which provides management oversight is chaired by David Burns in his capacity as Civic Campus Project Director.   There is also a Member Oversight Board made up of the Deputy Leader, Cabinet Member for the Economy, and the Cabinet Member for Finance and Commercial Services.  In addition to this, the Council had employed its own Contract Administrator (Currie & Brown).

 

The Chair noted that it was good to see the governance in place and requested for the full membership of the Executive Board to be circulated.  The officers must ensure transparency and full disclosure of information to Members.  He asked what caused the 4 months delay in signing the contract from November 2019 to March 2020.  In response, it was noted that the delay was due to the additional Cabinet and Full Council approval process.  Officers had been ambitious with milestones but had identified a better way to structure the joint venture which required additional approvals.  The process required additional time to ensure due diligence to protect the Council and A2Dominion interests. There was no risk to the deadline.  The contracts were not on the critical path at that point, in terms of delivery progress.  

 

Action - The full membership of the Executive Board to be circulated. 

 

Chris Littmoden asked for clarifications about Currie Brown’s role.  It was reported that they have the responsibility to monitor progress, the administration of the Council’s contract with particular focus on the town hall refurbishment, validate and challenge cost, and expenditure across the programme.  They will advise on risk and the critical path.

 

Councillor Johnson asked what the scope for potential changes and cost review in light of COVID-19 cost implications were.  Officers stated that in terms of  ...  view the full minutes text for item 5.

6.

Committee Work Programme

The Committee is asked to suggest topics for future consideration.

Minutes:

The following reports for the next meeting were requested:-

 

·       Reserves paper

·       Provisions

·       Gibbs Green estate

7.

Date of Next Meeting

The next meeting will be held on Wednesday, 16 September 2020.

 

 

LOCAL GOVERNMENT ACT 1972 - ACCESS TO INFORMATION

 

Proposed resolution:

 

Under Section 100A (4) of the Local Government Act 1972, that the public and press be excluded from the meeting during the consideration of the following items of business, on the grounds that they contain the likely disclosure of exempt information, as defined in paragraph 3 of Schedule 12A of the said Act, and that the public interest in maintaining the exemption currently outweighs the public interest in disclosing the information.

Minutes:

Monday 21st September 2020