Agenda and minutes

A webcast of the meeting can be viewed here.

The minutes of the meeting held on 12 were taken as read, confirmed and signed.

The Chief Executive reported that no questions had been received under Standing Order 34.

The Chief Executive reported that no questions had been received under Standing Order 7(3) and 7(5).

There were no urgent items for consideration.

The Chairman invited members who wished to do so to declare any interest in respect of items on the agenda for the meeting.  The following declarations were made:

Mr T. Richardson CC and Mr J. Morgan CC declared a personal interest in agenda item 11 (Leicester and Leicestershire Enterprise Partnership (LLEP) Annual Report) as they were both Directors on the LLEP Board.

All Members of the Commission who were also members of a district council declared a personal interest in agenda item 12 (Strategic Planning and Growth related matters).

There were no declarations of the party whip.

The Chief Executive reported that no petitions had been received under Standing Order 35.

A copy of a report to be considered by the Cabinet at its meeting on 17 September 2021 is attached for consideration by the Commission.  The Lead Member for Resources, Mr L. Breckon CC, has been invited to attend for this item.

The Commission considered a report of the Director of Corporate Resources which would be presented to the Cabinet at its meeting on 17^th September 2021 regarding the 2021/22 revenue budget and capital programme monitoring position as at the end of July (period 4), and which sought approval to change to the previously agreed 2021-2025 capital programme and the approach to updating the Medium Term Financial Strategy (MTFS) for 2022 – 2026.  A copy of the report marked ‘Agenda Item 8’ is filed with these minutes.

In presenting the report, the Director highlighted the following:

·       The current revenue position was £6m better than previously reported to Cabinet at the end of period 2, but there remained a £12m overspend, primarily due to 2 key areas: the High Needs Block (Children & Family Services) and Adult Social Care (Adults & Communities).

·       High Needs Block – A £6m overspend above the grant had been accounted for.  However, the overspend had now increased from £3m to £9m.  Whilst additional capacity had been and continued to be added to address the problem, use of costly, independent settings continued to increase.  This was a historical problem and whilst grant levels had risen, this did not match the pace of rising demand.

·       Adult Social Care – There had been little change to the £13m overspend previously reported.  The level of demand and the cost of services required both in home and residential care settings continued to rise.  As a result of Covid, some patients were being discharged earlier from hospital often with more complex needs placing additional pressure on the service.  Also, whilst less people were being placed in residential care homes in line with Council policy, providers were increasing their fees to compensate for falling numbers which added to the current position.  For home care services, during the last year additional Covid funding had been received from the NHS which had helped, but this was time limited.  Discussions with Health partners to secure additional income for the longer term continued, though this would not be sufficient to address the current overspend and pressure on this budget would likely continue in 2022.

·       The main change to the Capital Programme was the increase in expenditure for the two Melton road schemes.  This included establishment of a portfolio risk allocation to help manage the unavoidable risks associated with large complex schemes.  This also provided a greater level of transparency than including all the contingency within individual schemes.

Arising from discussion, the following points were made:

Revenue budget

(i)              It was questioned whether the Adult Social Care Target Operating Model (TOM) continued to be the right approach given the significant overspend in this area and the recent impacts of Covid on the social care sector.  Members noted that the transition of care to support more people in their own home was being managed gradually to allow the market time to adapt.  However, Covid had significantly increased the number of people immediately wishing to remain at home and this had driven the speed of change over the last year.  The Director confirmed that the TOM was still considered the right approach, this being preferred by residents and ultimately reducing the Services accommodation costs.  However, time was now needed to allow the market to catch up, as originally forecast.  The position would be monitored.

(ii)             Significant concerns were raised about the continued rise in SEND costs and the increasing High Needs Block (HNB) deficit.  The Council’s approach to build locally based SEND provision aimed to reduce reliance on expensive independent provision had been successful.  However, demand had continued to outstrip supply, meaning  ...  view the full minutes text for item 34.

The Lead Member for Resources, Mr L. Breckon CC, has been invited to attend for this item.

The Commission considered a report of the Director of Corporate Resources which set out the performance of the Corporate Asset Investment Fund (CAIF) for 2020/21.  A copy of the report marked ‘Agenda Item 9’ is filed with these minutes.

In response to questions raised, the Head of Strategic Property Services confirmed the following:

·                 The gross income across the Corporate Asset Investment Fund portfolio was £7.46m.

·                 No substantial developments on Council owned farmland had been accounted for in the current financial year.  Planning gain on such land had been shown in the previous years accounts and so had already been transferred into the ‘development land’ category.

·                 The Council acquired most of the farmland it currently owned in the 1920’s.  New land was currently acquired on a ‘one in – one out’ basis i.e. if the Council were to sell land for residential or development use it would seek to replace that within the portfolio.  The purchase of further land would also be considered where this adjoined an existing farm holding.

·                 The Council currently owned 7,700 acres of farmland.  Each holding was let and lettings were managed by the Strategic Property Services team.

·                 Office premises owned by the Council tended to be let on a 10 year lease with a 5 year break clause, or on a 15 year lease with a 10 year break clause.  The Lease of the new premises built at LUSEP was for a 15 year period with a break clause at 10 years.  Income from LUSEP would be reported next year, as this financial year the tenant had the benefit of a rent free period.

·                 A full review and valuation exercise was undertaken of every property asset owned by the Council every year.  This was undertaken by the Department’s in house valuers, taking account of national comparables and other bench marks.

Arising from subsequent discussion, the following matters arose:

(i)              A member queried whether legislation relating to the delivery of large scale infrastructure sites which prevented large housing developments within a certain distance would apply to the Hinckley National Rail Freight Interchange proposals and therefore affect the development proposed at the M69 J2 Stoney Stanton site.  The Head of Strategic Property Services reported that this would not affect proposals and no issues had been raised during discussions with the National Infrastructure Commission which envisaged housing being delivered on the adjoining site.  Nor had issues been raised by the district council or Tritax who were bringing forward the rail freight proposals.

(ii)             Members challenged the approach to invest extra capital into the Fund to support long term projects considering the immediate short-term financial pressures faced by the Council, as detailed in the Medium Term Financial Strategy monitoring report considered elsewhere on the agenda.

The Lead Member, Mr L. Breckon CC, agreed it was important for him and Scrutiny to test the current approach to invest in CAIF projects.  However, he provided assurance that he and officers looked at each commercial investment proposal critically to ensure its long-term benefits outweighed any potential short term gain.  He confirmed that where this was not the case then consideration would be given to selling an asset to realise its value to offset other budget pressures.

The Director confirmed that performance of the Fund had been exceptional, it having generated significant additional income for the Council for several years.  This had been allocated to support front-line services and reduce the need for savings which might have otherwise been necessary.  On balance, the current approach was considered still to be the right way forward.

A member commented that the ongoing long-term revenue benefit currently  ...  view the full minutes text for item 35.

The Commission considered a report of the Director of Corporate Resources which provided an update on the performance of East Midlands Shared Services in 2020/21 financial year.  A copy of the report marked ‘Agenda Item 10’ is filed with these minutes.

A member sought clarification on what had been done to address the issues arising out of the external audit of the finance system, in particular the ability for admin officers to assign themselves additional access.  The Commission was reassured that following implementation of the new Oracle Cloud system, this functionality had been removed and an approval mechanism introduced.  This ensured appropriate controls were now in place to prevent such access in the future. 

In response to a question raised, Members noted that the cost of laptops purchased to enable staff to work from home as a result of the Covid-19 pandemic had totalled £75,000.

RESOLVED:

That the performance of East Midlands Shared Services in 2020/21 be noted.

The Chief Executive of the LLEP, Mandip Rai, and the Chair of the LLEP Board, Mr Kevin Harris, will provide a presentation as part of this item.  A copy of the presentation slides is attached.

Mr P. Bedford CC, the County Council’s representative on the LLEP Board, has also been invited to attend.

Members received a presentation by the Leicester and Leicestershire Enterprise Partnership’s (LLEP) Chief Executive, Mr Mandip Rai, and Chair of the LLEP Board, Mr Kevin Harris, on progress during 2021 and the LLEPs priorities for 2022.  A copy of the presentation slides marked ‘Agenda Item 11’ is filed with these minutes.

The Chairman welcomed Mr Rai and Mr Harris to the meeting as well as Lead Member Mr P. Bedford CC, the Council’s representative on the LLEP Board.

Arising from discussion, the following points were raised:

(i)              A member questioned how projects which received LLEP funding were monitored and their outputs measured to assess the extent to which they benefited the local economy.  Members noted that the LLEP remained in constant contact with successful bidders to monitor their performance and ensure they achieved the milestones and outputs set out in their business case.   Such performance was considered regularly by the LLEP’s Investment Panel and the LLEP Board and ultimately the LLEP was required to submit details of project outputs on a quarterly basis to Government.  Such information was publicly available and published on the LLEP’s website.  A Member suggested that it would be helpful if in future reports to the Commission an overview of the outputs achieved by specific projects could be included so that Members could see how the allocation of resources to those projects had benefited the local economy.

(ii)            The allocation of £6m to the Sports Park Pavilion at Loughborough University was challenged.  A member questioned if and how the extension of an existing scheme benefited the local economy and whether funding could have been better spent on an entirely new project.  Members noted that the Chair of the LLEP Board had been involved in discussions with Government for some years regarding its plans to relocate some offices out of Whitehall.  A catalyst event to stimulate the move was necessary and this scheme was put forward given the specific accommodation requirements needed and other businesses within the locality.  The scheme had been a success as the Government’s Anti-doping Agency had now relocated to the area.  It was hoped that this would now pave the way for further Government office relocations in the future.  It was suggested that improved communications on this scheme would be beneficial to demonstrate this was not a simple extension of an existing facility, but a strategically selected project to secure the relocation of an entire government department which was therefore good value for money.

(iii)           A member questioned how financial risks for projects were measured and monitored and what contingencies were put in place to mitigate these.  Members noted that the business cases submitted by bidders were required to include a contingency element, particularly for capital projects.  If successful it was then their responsibility to work within the agreed funding envelope.  If costs were to escalate, the bidders would need to source further alternative funding elsewhere.  Assurance was provided however, that rigorous scrutiny of each business case was undertaken before recommendations were presented to the Programme Panel and thereafter to the Board for approval.

(iv)           Mr Bedford CC, Lead Member for Ways of Working and Covid Recovery, provided assurance as the County Council’s representative on the LLEP Board of the rigorous processes undertaken by the LLEP when considering projects and allocating funding.  He highlighted, however, that as the link between the Council and the LLEP, if the Commission or any of its members had any particular queries or concerns about specific projects these could be referred to him and he would seek to address them through the Baord as appropriate.

(v)            Members noted  ...  view the full minutes text for item 37.

Mr Rob Thornhill, the Joint Strategic Planning Manager for Leicester and Leicestershire had been invited to attend for this item. 

The Commission considered a report of the Chief Executive which provided an update on a number of key strategic planning and other related matters which affect the County Council, and how the Growth Service and others were working together to address these.  The report also provided an update on the uplift in housing numbers allocated to Leicester City and the implications of this for district council housing numbers and their current local plan proposals, as well as the County Council as infrastructure provider.  A copy of the report marked ‘Agenda Item 12’ is filed with these minutes.

The Chairman welcomed Mr Rob Thornhill, the Joint Strategic Planning Manager for Leicester and Leicestershire, to the meeting.

In presenting the report the Assistant Chief Executive highlighted the substantial increase in population predicted across the County over the next five years and the associated need to accommodate housing and employment growth, and for the County Council to provide the infrastructure to support this.  Members noted that the Growth Service had been established to better manage the Council’s contribution to the growth agenda and in particular the financial risk this brought to the Council.  The Assistant Chief Executive said the Service had been building positive relationships with district councils and had sought to engage early on their local plan proposals to address the issues detailed in the report.

Arising from discussion, the following points were made:

(i)              Members welcomed the report which provided a useful overview of what was a complex and ever changing picture.  Members agreed the need for the County Council to take a proactive approach given the impact growth would have on the localities and both County and district councils. 

(ii)             A member raised concerns about the uplift in housing numbers to be delivered by Leicester City and the real impact this would have on district councils that would have to meet the increased unmet need.  The member argued that it was clearly impossible for Leicester City to accommodate the uplift given it already could not meet its original allocation.  They suggested that the uplift would indirectly deliver what the Government’s original proposed change to the current planning system (i.e. to change the standard method for calculating minimum annual local housing requirements) aimed to deliver; a proposal which had received strong objection and so had been withdrawn.

(iii)           In light of the impact of Covid-19 on Leicester City, a member suggested that fresh consideration was needed on how it could deliver more housing, perhaps in place of some office and retail space given these sectors had been so badly affected.  The Member suggested that other cities such as Manchester had accommodated more housing and this had been hugely successful in bringing new life into the City.  Members noted the work being undertaken by the City Council to address the uplift and that it would receive a further update on the outcome of this work at an appropriate time.

(iv)           A member questioned whether, given recent changes (e.g. the City uplift and the loss of the planned A46 Expressway), it was now accepted that a fundamental review of the Strategic Growth Plan was necessary.   Mr Thornhill advised that the overall strategic view as set out in the SGP remained unchanged.  Essentially the Plan focused growth towards Leicester, recognised it as a central city, recognised the role of market towns, and focused growth in identified key areas (e.g. north west Leicestershire, in and around the proposed Freeport, the area around the A5 corridor, and around the proposed Melton Mowbray distributor road etc.) which had not changed despite the impacts of Covid.  Members noted  ...  view the full minutes text for item 38.

It is proposed that the next meeting of the Commission is rescheduled to take place on Wednesday, 17^th November 2021 starting at 10.00am. 

RESOLVED:

It was noted that the next meeting of the Commission had been moved and would now be held on Wednesday, 17^th November 2021 at 10.00am.