Agenda item

Commercial Strategy - Part 2

Executive Member for Investment and Companies.

Minutes:

The Executive Member for Investment and Companies, Councillor Archer, explained that Part 2 of the Commercial Strategy had been developed in recognition of the continuing financial challenges faced by the Council. Building on Part 1 agreed last year, Part 2 would provide detail about the implementation of the Council’s commercial activity, in particular investment activity.

 

Councillor Archer explained that, due to changes to the local government borrowing regime, the Council was no longer able to invest purely for yield, and therefore the Council’s commercial approach would need to be different in the future.

 

Part 2 of the Strategy proposed:

·       Ensuring that existing income streams from the Council’s assets, which provide income of around £4million, would be maintained and, where possible, increased.

·       That assets that were not generating income would be repurposed, redeveloped, or disposed of.

·       That the Council would continue to develop or redevelop assets to deliver the Council’s corporate objectives, whilst also securing new income streams.

·       Investment in new assets, where these would contribute to the Council’s corporate priorities, secure income or help deliver savings.

·       A project pipeline would assist in resource planning and income forecasting.

 

In terms of commercial services activity, the proposed Part 2 explained that the Council would continue to develop activity in areas where the Council already trades, introduce new trading activity, and explore opportunities to take a more commercial approach to the Council’s non-statutory fees and charges.

 

Councillor Archer explained that the proposed Part 2:

·       Explained how the Council would ensure decisions are robust, evidence based and transparent. It did not introduce changes to formal governance structures.

·       Confirmed arrangements for regular reporting on commercial income, project progress and asset portfolio performance

·       Recognised the need to develop in-house commercial skills and buy in expert advice and expertise in some cases.

 

The Overview and Scrutiny Committee had considered the proposed Part 2 and, as a result of their observations, Councillor Archer:

·       Confirmed that the Strategy would be amended to provide clarity that performance reporting and updates would be taken formally to meetings of the Commercial Ventures Executive Sub-Committee, and

·       Explained that he, and the Leader, were committed to ensuring that the Council had the skills in place to deliver the Council’s commercial plans.

 

The Chairman of the Overview and Scrutiny Committee, Councillor Harrison, explained that the Committee had scrutinised Part 2, and were of the view that it was realistic, and it was hoped commercial income would fill the budget gap. The Commercial Strategy Scrutiny Panel had highlighted the need for effective commercial governance and the importance of learning lessons from the past and from other local authorities. It was important to ensure the Council had the right skills to instigate the Strategy.

 

In response to questions from other Visiting Members, it was confirmed:

·       That the Commercial Strategy would work alongside the Housing Strategy

·       That the environmental implications of commercial property-related and service-related activity would be fully considered within business cases and through the decision-making process, and the Strategy recognised the opportunities that existed for combining commercial and environmental sustainability activities.

·       That the Council’s governance arrangements, including the Commercial Ventures Executive Sub-Committee and the Commercial Checklist, would ensure the Council was protected from risky commercial activities.

·       That the Council would only be able to undertake commercial activities if they were also considered to have a social benefit or otherwise contributed to the delivery of corporate objectives.

 

RESOLVED that the Executive approves the Commercial Strategy Part 2.

Supporting documents: