Agenda item

Cabinet Member: Property, Cultural & Community Services

Forward Plan Ref: 2016/132

Contact: Nigel Cunning, Corporate Landlord Manager Tel: (01865) 780250/Ben Threadgold, Policy & Performance Service Manager Tel: 07867 467838

Report by Acting Director for Environment & Economy (CA10).

This report considers the implications of the current asset transfer policy in supporting community groups to develop self-financing, sustainable proposals to take on responsibility for a children's centre. In particular it sets out the financial implications of different possible approaches, and the additional support that could be offered to community groups in developing viable proposals.

The Cabinet is RECOMMENDED to:

(a)          Maintain the terms of the existing Asset Transfer Policy in considering transfers of children’s centres to community groups;

(b)         Extend additional support (as outlined in para 31) beyond 1^st April to help community groups develop a viable business case fully;

(c)          Agree that a deadline is set for these cases to be brought forward to be considered at a 3^rd and final round of the Transition Fund, no later than the Cabinet meeting in July;

(d)         Offer a defined, short-term rent-free period of up to a maximum of 6 months to support mobilisation, where the business case would otherwise not be viable. After this initial period the rent would increase in line with the asset transfer policy, to 50% of the commercial rent level for the property.

Cabinet had before them a report on the implications of the current asset transfer policy in supporting community groups to develop self-financing, sustainable proposals to take on responsibility for a children's centre. In particular it set out the financial implications of different possible approaches, and the additional support that could be offered to community groups in developing viable proposals. Bev Hindle, Acting Director for Environment & Economy, Lucy Butler, Director for Children’s Services and Nick Graham, Chief Legal Officer attended for this item.

Councillor Fooks, local councillor for Wolvercote &Summertown spoke against the recommendations in the report commenting that the report seemed to be more business driven than service driven. She referred to the vital work in her community and highlighted that Council had recognised that best value was not always about the best financial decision. She expressed concern at the increase in rents and highlighted the constant need of groups to bid for funds. Groups in her area such as the Wolvercote Young people’s Club had nowhere else they could go. Councillor Fooks asked Cabinet to reject the recommendations and to review what was important in the light of the spirit of the Council resolution.

 John Hulett, spokesperson for Red Kite Children’s Centre Working Group expressed disappointment with the recommendations and urged Cabinet to consider the implications of their decision on centres such as his own. They had worked hard to put together a viable and sustainable business plan despite being asked by the Council to show the community rent which showed as a deficit as they had no further access to funds. He commented that suggesting that the waiver would be a disincentive to put in place a sustainable financial model misunderstood the nature of the business model for a free service. It was essential that services remained free in order not to discourage those families most in need of support. Their building was small and purpose built and was a difficult place to hire out to others and would not bring in sufficient revenue to pay for the service. By setting up a community project they were saving the Council money and providing an early warning system for families in difficulty. The rental income would be new money and in effect by charging rent the Council was reducing the transition grant given.

Mr Hulett urged Cabinet to waive rent for the whole of the first year and and to agree to a review of Group’s viability before charging rent in future years.

Charlie Payne, local resident spoke against the proposals querying what would happen if centre’s failed due to high rents.  If it failed there would be no rent and a building to heat and maintain. She highlighted problems with hiring to others as her local centre had a connecting door to a nursery for children with special educational needs. Responding to a question about the costs incurred by the Council due to responding to a judicial review Charlie Payne commented that she was not a legal expert.

Councillor David Williams, local councillor for Ifley Fields & St Margaret’s highlighted the importance to groups of being able to show they would be able to remain open when looking for funding. He urged Cabinet to honour the motion at Council and provide support for at least one year. He suggested that the amounts involved were quite small and that communities having done a massive amount of work should not be undermined by rent charges.

Councillor Anne Purse, local councillor for Wheatley highlighted the difficulties for her local group, Friends of Mapletree Centre and asked for ongoing rent reductions in order for the Group’s business plan to work. She stressed that there were no suitable alternatives to the building they were in and asked that they not be allowed to fail due to high rents.

Councillor Gill Sanders, Shadow Cabinet Member for Education and Children & Family Services, queried whether a proposal for 6 months was legal given the Council motion and discussion at Council where it was understood that it would be for a period of at least one year. Councillor Sanders supported comments by others that libraries could not replace purpose built children’s centres.

Nick Graham, responding to the point raised by Councillor Sanders advised that there was a distinction between the functions of Council and Cabinet. A motion in Council does not have the power to require Cabinet to do something which falls within their functions. Cabinet cannot be bound by the motion but are rather called on to consider the proposed action.

Councillor Lindsay-Gale, Cabinet Member for Property, Cultural & Community Services in moving the recommendations stressed that she and officers had been listening and were proposing a recommendation that was fair, consistent and balanced. Six schemes had already been agreed and another eight were in progress with a further 10 being worked on. Councillor Lindsay-Gale referred to the Council motion noting that it contained no period for the rent waiver.

Cabinet discussed the recommendations at length with Councillor Carter commenting that to him it seemed sensible that the rent waiver should cover the same period as the transition fund. If not then new organisations would see part of their transition grant clawed back for rent. He was unable to support a period of 6 months. A number of councillors expressed concern that 6 months was not sufficient time. Councillor Harrod proposed increasing the rent free period to 12 months, with a review after 6 months to consider progress, which was seconded by Councillor Lindsay-Gale. Cabinet made it clear that the continued rent free period from 6-12 months was dependent on sufficient progress being made towards a sustainable business plan. Cabinet also clarified that the 12 month rent free period should start no earlier than 1 April 2017.

RESOLVED:             to:

(a)          Extend additional support (as outlined in para 31) beyond 1^st April to help community groups develop a viable business case fully;

(b)          Agree that a deadline is set for these cases to be brought forward to be considered at a 3^rd and final round of the Transition Fund, no later than the Cabinet meeting in July; and

(c)          Offer a defined, short-term rent-free period of up to a maximum of  12 months to support mobilisation, where the business case would otherwise not be viable with a review after 6 months to consider progress. After this initial period the rent would increase in line with the asset transfer policy, to 50% of the commercial rent level for the property.