Agenda and minutes

Members are asked to declare any interests in the items under consideration and in doing so state:

(1) the type of interest concerned either a

(a)   personal interest

(b)   prejudicial interest

(c)    disclosable pecuniary interest (DPI)

and

(2) the nature of the interest concerned

If any member requires advice on declarations of interests, they are advised to contact the Head of Democratic Governance in advance of the meeting.

There were no declarations of interest on this occasion.

To seek the shareholder’s view on whether 16 and 17 year old employees of Council wholly owned companies should be paid the Joseph Rowntree Foundation living wage.

Mr Mark Towers, Company Secretary presented a report seeking the shareholder’s view on whether 16 and 17 year old employees of Council wholly owned companies should be paid the Joseph Rowntree Foundation living wage. It was noted that clarification had been sought by one company about whether the living wage should apply to 16/17 year olds as well as those aged 18 and over, excluding those undertaking apprenticeships.

The Advisory Board agreed that the principle view of the shareholder was that 16 and 17 year olds be paid the Joseph Rowntree Foundation living wage.

To receive an overview of the Company from the Chief Executive and Chairman.

Mr John Donnellon, Chief Executive, Blackpool Coastal Housing Company (BCH) provided an overview of the work of the Company to the Advisory Board. It was noted that BCH was an arm’s length management company wholly owned by the Council and that there were three years remaining of a 14 year contract to manage Council housing stock. He advised that key roles of the company included capital expenditure on improvements to housing, managing stock to meet both general and specialised needs and to provide sheltered schemes for the elderly and vulnerable.

Mr Donnellon reported that the Company aimed to support the Council in achieving its priority to create Resilient Communities. To achieve the priority, BCH had taken on new work commissioned by the Council such as the Care and Repair Service, Disabled Facilities Grants and had assisted in the development of the Queens Park Community Association. The Company had also identified an issue with Care Leavers’ ability to maintain tenancies and had been commissioned by Children’s Services to provide more support to that vulnerable group.

The Advisory Board discussed the challenges and opportunities related to the Company and noted the concerns relating to the roll out of Universal Credit and ability of tenants to pay rent as a result. The lack of social housing and potential slow economic growth were noted as additional challenges. With regards to opportunities, Mr Donnellon advised that the Company was seeking to become more business focussed in order to increase effectiveness and become more competitive. The potential to work jointly with My Blackpool Home and the development potential of Grange Park and Troutbeck were also considered opportunities.

In response to questioning, Mr Donnellon advised that Troutbeck had been identified as less attractive to tenants and work was ongoing to consider options to improve the housing offered. It was noted that the Shareholder’s view would be sought on the proposed options later in 2018.

Members considered the financial position of the Company and noted that retained Council housing was funded through a ring fenced account called HRA. The primary income for the Company was rent, which was set by the Council based on Government recommendation. It was reported that the management fee paid by the Council to BCH had been frozen at £9,565 million for the previous four years. Mr Donnellon advised that the Company must determine how to allocate the funding, managing inflation and that it was the Company Board’s role to monitor outcomes and performance.

Mr Donnellon went on to advise that BCH was managed as a going concern with its own external auditor and accounts. He added that the HRA was required to produce a 30 year balanced business plan and that recent Government changes requiring a 1% rent deduction each year for four years had significantly impacted upon the 30 year plan.

The Advisory Board noted the high level of HRA reserves and queried whether such high levels were necessary. In response, Mr Donnellon advised that the reserves were currently at a higher  ...  view the full minutes text for item 3.

Resolved: That under Section 100 (A) of the Local Government Act 1972, the public be excluded from the meeting during consideration of the financial model of Blackpool Housing Company on the grounds that it would involve the likely disclosure of exempt information as defined in paragraph 3 of Part 1 of Schedule 12A of the Act.

To receive an overview of the Company from the Managing Director and Chairman.

Mr David Galvin, Managing Director, Blackpool Housing Company (BHC) Limited and Councillor Jim Hobson, Chairman, Blackpool Housing Company Limited provided an overview of the work of the Company to the Advisory Board and highlighted that the vision of the Company was to be the landlord of choice in Blackpool and in achieving the vision to address the poor quality of private housing currently offered in the town.

It was reported that BHC had been established to intervene in the private sector housing market in the inner areas of Blackpool. The Company would have approximately 200 units by the end of March 2018 focussed mainly in Bloomfield, Talbot and Claremont Wards and was trying to cluster properties for impact.

Councillor Hobson highlighted that the main purpose of the Company was to purchase poor quality properties, renovate them into homes to a high standard and subsequently let out and manage the properties and provided an example of a recent project. The Company had also taken on additional roles in project management and was working with the Council and Blackpool Coastal Housing in order to achieve outcomes and regenerate areas.

The Advisory Board was informed that BHC was in the second year of a 10 year programme and aspired to let out between 800 and 1,000 properties by the end of the programme. The financial model of the Company assumed no changes to the loan provided by the Council for the capital programme and that rental income would grow based on an increased number of properties being acquired.

The Advisory Board considered the financial model in detail and discussed how the loan funding was currently provided by the Council to the Company. It was agreed that the Director of Resources be invited to a future meeting in order to explain the funding of the Company in more detail.

Mr Galvin went on to highlight the main challenges facing the Company and the Advisory Board noted the concerns related to achievement of rental income, managing investment risk and private landlord competition.

Members discussed the key performance information of the Company in detail and noted that it would be difficult for the Company to demonstrate qualitative performance through indicators. It was noted that a questionnaire was to be sent to relevant stakeholders including the Police and Planning Enforcement in order to identify differences to reporting from properties before and after BHC purchased the property. For example the Police would be requested to provide an overview of the number of visits to and reports about a specific property in order to identify any changes following the intervention by BHC. It was hoped that the feedback would demonstrate the positive impact BHC had had in stabilising and improving neighbourhoods. It was also noted that monitoring the length of tenancy would demonstrate the impact upon transience.

In response to questions, Mr Galvin advised that the financial model allowed for bad debt provision and that the net income demonstrated achievement of income after non-collection had been taken into account.  ...  view the full minutes text for item 5.

To note the meeting schedule as follows:

Thursday, 1 March 2018, 14.00 – 16.00 Blackpool Operating Company

Thursday, 5 April 2018, 10.00 – 12.00 Blackpool Transport Services

Thursday, 17 May 2018, 14.00 – 16.00 Blackpool Entertainment Company Limited

The Advisory Board agreed to note the date of the next meeting as Thursday 1 March 2018 commencing at 2.00pm.