Issue - meetings

To consider a report of the Executive Councillor (Communities & Sustainability)

(Note: this report contains information ‘not for publication’ contained in its appendix that has been circulated to executive councillors only)

The purpose of this report is to request the Executive’s consideration of the proposal received from Stockport Homes (SHL) to seek a loan of £9.2m from the Council to support the acquisition and redevelopment costs of a new headquarters. 

It is recommended that

a)    The Executive considers the proposal received from Stockport Homes (SHL) to seek a loan of £9.2m from the Council to support the acquisition and redevelopment costs of a new headquarters; and,

b)    If agreed, delegate the drafting and agreement of the terms of the loan to the Corporate Director for Corporate and Support Services in consultation with the Executive Councillor (Corporate, Customer & Community Services).

Officer contact: Paul Lawrence, 0161 474 4515, paul.lawrence@stockport.gov.uk

The Executive Councillor (Communities & Sustainability) submitted a report (copies of which had been circulated) inviting the Executive Meeting to consider a request from Stockport Homes to seek a loan of £9.2m from the Council to support the costs of the acquisition and redevelopment of a site for a new headquarters. A business case to support the proposals had also been submitted (the exempt appendix to the report).

(Note: the report included information ‘not for publication’ that was included in the appendix that was circulated to executive councillors only)

The Executive Councillor (Communities & Sustainability) stated that despite suggestions in the media, the proposal would not affect the resources available to support tenants nor the provision of additional social housing in Stockport, and the cost of the loan would be offset by the savings in rent by Stockport Homes. The final detail of the agreement would be delegated to officers, but the agreement would ensure that the interests of the Council and residents would be protected.

RESOLVED – That the proposal from Stockport Homes for a loan of £9.2m from the Council to support the acquisition and redevelopment costs of new headquarters be supported, and the Corporate Director for Corporate and Support Services in consultation with the Executive Councillor (Corporate, Customer & Community Services), be authorised to draft and agree the terms of the loan.

To consider a report of the Corporate Director for Corporate and Support Services and the Corporate Director for Place Management and Regeneration.

The report details a proposal from Stockport Homes to seek a loan of £9.2m from the Council to support the acquisition and redevelopment costs of a new headquarters.

(NOTE: the report includes exempt information ‘not for publication’ contained in a confidential appendix which has been circulated to members of the Scrutiny Committee only).

The Scrutiny Committee is recommended to comment on the report.

Officer contact: Michael Cullen on 474 4631 or email: michael.cullen@stockport.gov.uk

The Corporate Director for Corporate and Support Services submitted a report (copies of which had been circulated) detailing a proposal from Stockport Homes to seek a loan of £9.2m from the Council to support the acquisition and redevelopment costs of a new headquarters.

The Chair reported that members of the Corporate, Resource Management and Governance Scrutiny Committee had also been invited to attend the meeting of the Scrutiny Committee as there were a number of areas of overlap between the remit of both committees in relation to this item.  The Chair invited members of the Corporate, Resource Management and Governance Scrutiny Committee to participate in the discussion on this item.

The Executive Councillor for Communities and Sustainability (Councillor Stuart Bodsworth) and Helen McHale (Chief Executive, Stockport Homes) attended the meeting to answer Councillors’ questions.

The following comments were made/ issues raised:-

·         A discussion took place in relation to the element of risk that would be assumed by the Council associated with any variances from the modelled interest rate detailed in the report.

·         It was stated that Stockport Homes would not seek an increase in the management fee paid by the Council to support the loan for the any new head office building.

·         A councillor raised the issue of the proposed loan decreasing the latitude of the Council to secure finances for other developments in the borough.  In response it was stated that the Council was able to determine the limit at which it borrowed based on sustainability and affordability, and further that the Council was currently well within those limits.

·         Concern was expressed in relation to the potential for the cost of the development to rise after the contract had been awarded.  In response, it was stated that Stockport Homes had a history of successfully managing significant capital projects in the past which had all come in within budgetary constraints.

·         It was stated that in the light of the costs associated with remaining within the current accommodation, it was anticipated that the provision of a new headquarters building would be cost neutral over the 30 year loan term.

·         A councillor asked whether it was the intention of Stockport Homes to centralise services within the new headquarters development.  It was subsequently stated that no services would be centralised as a result of this development and any district based offices would remain in place and Stockport Homes’ staff would aim to visit tenants in their homes rather than expect them to come to the town centre.

·         It was noted that the development would consolidate staffing resources in one location which would assist with a more co-ordinated approach to service delivery.

·         The potential for consideration to be given to other locations for a new headquarters building was discussed.

·         Concern was expressed in relation to the apparent juxtaposition of the significant demand for new social housing in the Borough against the expenditure outlay for the construction of a new headquarters building.

MOVED AND SECONDED - That the Executive be recommended to not give approval to the making of a loan to from the Council to Stockport Homes to support the acquisition and redevelopment costs of a new headquarters.

For the motion 3, against 5, abstentions 1.

MOTION NOT CARRIED

A named vote was requested in relation to the voting on this motion.

Those councillors who voted for the motion were Councillors Sheila Bailey, Paul Moss and Wendy Wild.

Those councillors who voted against the motion were Councillors Kevin Dowling, Daniel Hawthorne, Sue Ingham, Syd Lloyd and June Somekh.

Councillor Ben Alexander abstained.

It was then

RESOLVED – That the report be noted.