Issue - meetings

Councillor Ivimy noted that the response given by Councillor Andrew Jones to the public question at Council on 29 January 2016 regarding the legal status of the Council's housing Joint Venture was misleading.

The Leader noted that he was aware that a complaint had been received regarding the response to this public question and advised that this was purely accidental. There was no intention to mislead at all.

Councillor Jones accurately explained that legal advice had been received which concluded that the Joint Venture was likely to be judged ultra vires. That legal advice was obtained by the funders whilst the Council's own legal advice is that the Joint Venture was not likely to be judged ultra vires.

However the decision to wind up the LLP and create a new company in order to remove any uncertainty from potential funders is a direct result of these competing counsel's opinions and the risk to the JV this caused.

This uncertainty and the risk that the JV could be judged to be ultra vires led to the decision by the Council to change the structure. Had the JV not originally been established as an LLP, neither the risk nor the need for the decision would have arisen. This is what caused the delay, which is the answer to the question asked.

Councillor Jones would like to apologise for any misunderstanding this has caused.

The Leader asked Councillor Ivimy if she accepted the apology.  Councillor Ivimy acknowledged that she did but expressed her concerns in relation to the planning consideration of the development which proposed 100% affordable housing to be provided at Edith Summerskill House largely funded by S106 contributions. She noted that this was in breach of the GLA planning guidelines which required a maximum of 40%.

She also added that S106 contributions was meant to be used to mitigate the adverse impact from the development and not to fund more developments. She questioned whether it would be an appropriate use of the funds and if officers had sought legal advice in this respect. Officers advised that the S106 contributions were secured for either affordable housing or social and physical infrastructure purposes in the Borough, and therefore perfectly legal to use that for this purpose.

Councillor Ivimy believed that there would be a financial loss to the Council due to the total number of affordable housing units involved at Edith Summerskill House. She urged Cabinet to reconsider the proposal.

The Leader noted that any potential financial loss would be compensated by the very robust figure negotiated for S106, which had been the most successful anywhere in the country, and that the Administration would use it to tackle the housing crisis to accommodate local people.

RESOLVED:

1.            That approval be given for the Council to take such actions as are necessary to wind up the LLP and to establish a new company, with the Council becoming a shareholder in the New Company alongside Stanhope Plc.

2.            That delegated approval be granted to the  ...  view the full minutes text for item 145