Agenda item

Commercial and Regulatory Services Portfolio Holder. To  receive a report (C-050-2020-21) on the Qualis Group Business Plan. Full Business Plan to follow.

The Cabinet recommend that Council agree the one year Qualis Business Plan.

The Commercial and Regulatory Services Portfolio Holder, Councillor Patel introduced the Qualis Business Plan for 2020-21.

The Business Plan set out the detailed activities for Qualis in the forthcoming year and, once agreed by the Council, Qualis could deliver these activities without further recourse to the Council.

Approval of the Business Plan represented the Council’s main mechanism for annually influencing and controlling the activities of Qualis.

The Business Plan presented here was the first full Business Plan produced by Qualis and reflected the ongoing development and positioning of the company.  For this reason, and because the final Board had only recently been appointed, Qualis had produced a single year Business Plan for 2020/21.  A 4 year Business Plan would be developed and presented to the Council as the new Board of Qualis planed the future strategy for the Group.

Councillor Philip noted the expected future returns from Qualis to the Council for the next year. Covid had had an affect and would also affect the budget. But without having this in place the council would be struggling more for the next and coming years. He welcomed the report and welcomed seeing the four year business plan that would allow us to factor it into our medium term financial strategy.

Councillor Murray asked how the acquisitions, as reported in the business plan, would work. Councillor Patel replied that the Council had enabled Qualis to purchase properties on the open market to enable them to generate an income stream. It was not for us to determine what they purchased. Councillor C Whitbread noted that they also had to go through due diligence before they purchased anything. They were investment purchases for good yields and positive returns.

Councillor Murray noted paragraph 6 of the report need cabinet approval about the transfer of future services; but he would like scrutiny to have a look at the case as well before the service was transferred to Qualis. Councillor C Whitbread agreed that was a good point and he would like to investigate further and feedback at the next Council. Councillor Patel said it seemed a sensible approach.

Councillor Wixley noting paragraphs 4.1 and 4.2 of the report expressed his concern over the Pyrles Lane development of 80 dwellings (as opposed to the 36 originally proposed). The site was backed onto by a number of residences in his ward. This was a sensitive site and he asked for consideration for the near-by residents. Councillor C Whitbread said that Qualis would give due regard to local residents when putting forward planning applications. Councillor Patel said they would have to abide by the planning process, and it was in their interest to work with ward members and local residents.

Councillor Chris Pond asked if the Portfolio Holder had made an estimate of the effect of on the business plan by the statement made last week by the Chancellor of the Exchequer on the question of the misapplication of Public Works Loans Board loans for the purpose of ensuring yields. Councillor Patel said that this was at a very early stage from when the announcement was made. He has had a meeting with the relevant officers, and they will be looking at this as they moved forward. We were still awaiting more details. Councillor Philip added that there was not enough information to know what it would mean and to remain compliant with it; but Qualis could still raise funds outside the Council.

Councillor Jon Whitehouse said that he would like to have a full report earlier. He also considered that members did have an interest and what Qualis acquired as it was our resident’s capital being invested. It came as a surprise to him that Qualis was investing outside the district as he remembers at a Cabinet Finance committee meeting where members were not keen on doing that. Finally, he was pleased to see that there was a bit more clarity that the district council was to buy back the new sports centre from Qualis and presumably enter into a management agreement.

Councillor C Whitbread said that ideally, he would like in the future to see the business plan go to a select committee first.

Councillor Heap asked about the acquisitions mentioned in the report, did they employ someone to seek these out and was it commissioned based, if so, how much did it cost. We did not agree to speculation outside the district when it was set up. This money should have been invested in the District. Councillor C Whitbread disagreed and said that we needed to be in a position where we were getting a good return for our investments and not all investments in our district would give us a good return. It could be argued that local investments would help protect jobs. However, these were all good investments that had gone through due diligence. S Jevans added that the Council agreed an asset management strategy back in February about the approach to investments outside the district. Qualis has a Risk and Investment Committee who consider in great detail each opportunity and we then engaged with commercial estate agents on a fixed fee.

A written answer would be given as to the amount of the fees paid.

Decision:

The Cabinet recommend that Council agree the one year Qualis Business Plan.

Reason for Proposed Decision:

Under the terms of the Shareholder agreement between Qualis and the Council, Qualis is required each year to bring forward an annual and a 4 year Business Plan for agreement.

Other Options for Action:

No other options were available.