Agenda and minutes

To elect a Vice-Chairman of the Committee for the remainder of the Municipal Year, following the amendment to the Conservative Group membership of the Committee in December 2019.

It was proposed by Councillor V.J. Leighton and seconded by Councillor R.J. Noble and agreed that Councillor N.J. Gething be appointed Vice Chairman for the remainder of the municipal year.

To confirm the minutes of the meeting held on 26 November 2019 as a correct record.

The minutes of the meeting held on 26 November 2019 were approved as a correct record.

To receive any disclosures of interest from councillors in accordance with the Council’s Code of Conduct for members.

There were none.

No Cabinet decisions have been called in.

No Cabinet decisions have been called in.

A copy of the latest Forward Plan is attached.

If any members of the Committee have any issues they want to raise in relation to the Cabinet Forward Plan, please inform Terry Collier, Deputy Chief Executive, 24 hours in advance of the meeting with reasons for the request.

The Cabinet Forward Plan was noted.

To note the Treasury Management half yearly position.

Members of the Committee had been requested to submit questions regarding the Treasury Management half-yearly report for 2019-20 in advance of the meeting.  The questions and responses were circulated in advance of the meeting and are attached to these minutes.

It was requested that the timing of financial reports are considered when planning the programme of meetings in order that the reports are brought before the Committee within an appropriate timescale.

It was agreed to provide further detail in writing to the Committee after the meeting regarding:

1.    The movement in long and short term borrowing shown in Table 2 of the report.

2.    Information about how Knowle Green Estates Ltd investment would appear in the capital expenditure summary (Table 1 of the report).

The Chief Finance Officer offered to discuss separately individual concerns about the methodology used to calculate the dividend yield.

Resolved to note the report, subject to some concern about the values in the report.  The Chief Finance Officer will report back to the Committee on the above points.

To consider a review of the use of Article 4 Directions to manage conversions to Houses in Multiple Occupation and whether changes in legislation introduced in October 2018 have resulted in improvements to the management and safety standards in such properties.

The Committee received a report concerning Houses in Multiple Occupation (HMO).  The Planning Development Manager outlined the background to the report; the subject was previously scrutinised by the Committee in November 2018 following a change in legislation and an update requested for late 2019/early 2020.

The report had been prepared jointly by Planning and Environmental Health using data for the period October 2016 to September 2019, the two years preceding and the year following the new legislation coming into effect. The data showed that there was insufficient evidence at present to justify the introduction of Article 4 direction but HMOs would continue to be monitored by the Planning Enforcement and Environmental Health teams.

The Committee asked a range of questions and in response were advised:

·         There were a number of reasons why some areas had a higher number of HMOs than others, generally it occurred in university towns or where the cost of rented property was very high.  In Spelthorne the general tendency was for friends to rent a house together or through an agency. The number of HMOs in Spelthorne was very small in comparison to other areas. 

·         There was a cluster of HMOs around Ashford Town and Ashford North/Stanwell South, which was likely to be due to the size and type of properties.

·         The new licensing regime had improved management and safety standards. 

·         Most complaints received related to noise and accumulation of rubbish.

·         There had been an increase in enforcement action as a result of the legislative change.  Information was gathered from many different sources and the approach used by the enforcement team would depend on the nature of the potential breach. 

·         There had been one case relating to modern day slavery, and three concerning possible illegal immigration. 

Resolved to note the report.

To receive a report on the new statutory guidance on Overview and Scrutiny.

The Committee received the report relating to new statutory guidance on Overview and Scrutiny to ensure that the function is carried out effectively and agreed that further consideration needed to be given to this

Resolved to carry forward this item to the next meeting where suggestions for tangible actions can be considered.

To consider the Governance arrangements for Knowle Green Estates Ltd.

Resolved to move the exclusion of the Press and Public for the following item in view of the likely disclosure of exempt information within the meaning of Part 1 of Schedule 12A to the Local Government Act 1972, as amended by the Local Government (Access to Information) Act 1985 and by the Local Government (Access to information)

(Variation) Order 2006.

Terry Collier, Deputy Chief Executive, conveyed the apologies of Councillor A.J. Harman, as Chairman of the Board of Knowle Green Estates, who was unable to attend the meeting.  

Howard Williams, Non-Executive Director of Knowle Green Estates Ltd (KGE), outlined the history of the company and why it was first established in 2016.  Since the company’s formation the Council’s direction in relation to provision of housing had substantially changed and it was now envisaged that the role of KGE would be to manage most of the Council’s residential assets, managing within the next few years tenancies of 500-600 properties.

The residential portfolio would include a range of types of rental properties.  It was proposed that the Council would acquire and develop suitable sites before handing these over to KGE for management.  The financial arrangements for the transfer of properties were broadly outlined.

The Committee were advised that the report to be presented to Cabinet also requested that a new company, Knowle Green Estates Group, is set up with facilities for limited liability partnerships (LLP) for risk and tax management purposes.

Members were also informed that the accounts had been independently audited and were now being reviewed by the Council’s external auditors as part of the Council’s consolidated accounts.

The Committee scrutinised the report in detail and raised a number of questions.  In response to these they were advised:

• The structure of the group was still under consideration by Cabinet in the role of shareholder representative.  No Special Purpose Vehicles (SPV) or LLPs have been set up. 
• The board structure had been broadened to include two non-executive directors which would bring a wider range of experience to the company and provide safeguards for continuity purposes. It had recently been decided that the company secretary need not be an individual but appropriate members of the legal department.
• The company would take its direction from the Council as the sole shareholder.  
• The company will not be able to purchase or dispose of assets without the permission of the Council. Furthermore they cannot source third party funding without the permission of the Council. There had been clear instructions from the shareholder that the intention was to retain the properties for ever and not sell them.  If at any stage sales were considered necessary, the company would need Cabinet’s (as the shareholder representative) agreement to do so.  It was also confirmed that the company was not authorised to raise mortgages on the properties.
• The Council will complete the residential developments and incur costs from the PWLB or equivalent funding source.  At the point of completion the property will be transferred to KGE; they will buy assets  ...  view the full minutes text for item 15/20

To consider the Committee’s work programme for the remainder of the Municipal year.

The Chairman provided an update on the work programme of the Committee.  To avoid duplication of work, it was agreed that instead of considering the topic of renewable energy, the Committee would receive a report from the Leader’s Climate Change task group at the next meeting and regular updates thereafter. 

One of the items on the programme, to consider the need for a crematorium, had not yet been addressed.  The Committee agreed to set up a task group consisting of Councillors Noble, Nichols and Richard Dunn to consider this.  Councillor Noble requested that the issue is renamed ‘Provision of a Celebration of Life Centre’ rather than provision of a crematorium on the work programme. 

Resolved to note the work programme.