Agenda item

(The Director of Housing) To consider the attached report (CHB-003-2013/14).

(1)        That the Development Strategy, formulated by the Council’s Development Agent in conjunction with Council Officers, and attached as an Appendix to the report to the Cabinet Committee be adopted with specific attention drawn to the following:

(a)        financial appraisals for each phase to be modelled on a 30-year pay-back period with a positive Net Present Value (NPV) over 30-years, using the financial assumptions set out in the appendix to the Strategy;

(b)        any financial shortfall to be met with subsidy, the details of which are set out in a separate report on “Funding the Housebuilding Programme” considered by the Cabinet Committee;

(c)        the Key Performance Indicators to be used, as previously agreed by the Cabinet;

            (d)        the feasibility reporting format, consisting of:

(i)      the design proposals (the number and nature of

units to be developed);

(ii)     a scheme budget estimate;

(iii)    a procurement plan;

(iv)    a financial appraisal of the site;

(v)     a project time table;

(vi)    a project risk assessment; and

(vii)   a recommendation on how to proceed.

(e)        East Thames’ existing EU-compliant Framework Agreement to be used for constructing the Council’s new homes;

(f)         the East Thames Design Guide being adopted to inform the development of each site; and

(g)        the East Thames Employers’ Requirements being adopted.

The Assistant Director of Housing presented a report regarding the Development Strategy for properties to build as part of the Council’s Housebuilding Programme.

The Assistant Director reported that the Cabinet had previously agreed to develop around 120 new Council properties over a 6-year period, with East Thames undertaking the role of Development Agent to deliver this Programme on behalf of the Council. In order to achieve this, a Development Strategy was required, setting out the approach the Development Agent and the Council would take, including what assumptions would be made, the standards used, the consultation methods that would be adopted, the procurement methods used for construction works and the performance targets used to measure progress, and ultimately the success of the Programme.

It was noted that hard copies of the East Thames Design Guide had previously been provided to all members of the Cabinet Committee (with further copies made available at the meeting). Hard copies of the East Thames Employers Requirements were also available at the meeting. Both of these documents formed a part of the Development Strategy.

The Cabinet Committee queried how the selection was made for the developments proposed for the first year of the Programme.

The Assistant Director reported that the Red Cross site in Waltham Abbey was the most advanced, as there was secured funding of £90,000, from the Harlow Growth Area Fund which needed to be utilised as soon as possible otherwise the funding could be at risk, this had dictated the first scheme. A Gatrell from East Thames advised the Cabinet Committee that the most economical way forward was to keep developments in the same area together in the same package.

It was noted that approval to the adoption of the Development Strategy was reserved to the Cabinet, on the recommendation of the Cabinet Committee.

Recommended:

(1)        That the Development Strategy, formulated by the Council’s Development Agent in conjunction with Council Officers, and attached as an Appendix to the report to the Cabinet Committee be adopted with specific attention drawn to the following:

(a)        financial appraisals for each phase to be modelled on a 30-year pay-back period with a positive Net Present Value (NPV) over 30-years, using the financial assumptions set out in the appendix to the Strategy;

(b)        any financial shortfall to be met with subsidy, the details of which are set out in a separate report on “Funding the Housebuilding Programme” considered by the Cabinet Committee;

(c)        the Key Performance Indicators to be used, as previously agreed by the Cabinet;

            (d)        the feasibility reporting format, consisting of:

(i)      the design proposals (the number and nature of

units to be developed);

(ii)     a scheme budget estimate;

(iii)    a procurement plan;

(iv)    a financial appraisal of the site;

(v)     a project time table;

(vi)    a project risk assessment; and

(vii)   a recommendation on how to proceed.

(e)        East Thames’ existing EU-compliant Framework Agreement to be used for constructing the Council’s new homes;

(f)         the East Thames Design Guide being adopted to inform the development of each site; and

(g)        the East Thames Employers’ Requirements being adopted.

Reasons for Decision:

Approval of the Development Strategy remained the responsibility of the Cabinet. However the House-building Cabinet Committee was required to consider and then recommend its approval to the Cabinet.

Other Options Considered and Rejected:

(1)        Not to adopt the contents of the Strategy in the format presented and alter any of its statements, targets, standards, procedures or assumptions. However, this could have an effect on the feasibility studies presented elsewhere on the agenda.

(2)        To adopt alternative Design Standards and Employers’ Requirements and develop the Council’s own. However, this would be time consuming and ultimately delay the programme, and are unlikely to be much different from East Thames’

(3)        To procure the construction works independently of the East Thames framework of contractors. However, this would require an EU procurement exercise and all of the time and expense that goes with it, and that would mean a delay in Phase 1 of the Programme.