THAMESWEY BUSINESS PLANS 2016

Transcription

1 Agenda Item No. 5 EECUTIVE 19 NOVEMBER 2015 Executive Summary THAMESWEY BUSINESS PLANS 2016 This report provides details of the Thameswey Group Business Plan with individual Business Plans for the companies listed below. The Business Plans have been approved by the relevant Boards of the Thameswey companies. A briefing on the Business Plans was provided to Members on 3 rd November The financial year end for all companies in the Thameswey Group is 31 st December; accordingly all plans and accounts are for calendar years, not the Council s year end of 31 st March. Audited accounts for each company for the year ending 31 st December 2014 and prior are available on the Group s website ( ) and a briefing paper has been ed to all Members. Attached are the Business Plans for the Thameswey Group of Companies listed below together with a consolidated Thameswey Group Business Plan. Thameswey Energy Limited Thameswey Central Milton Keynes Limited Thameswey Solar Limited Thameswey Housing Limited (includes Thameswey Guest Houses Ltd) Thameswey Developments Limited Thameswey Maintenance Services Limited Thameswey Sustainable Communities Limited Rutland Joint Venture Companies (includes Rutland (Woking) Ltd, Rutland Woking (Carthouse Lane) Ltd and Rutland Woking (Residential) Ltd recently changed name from Rutland Woking (Westminster Court) Ltd.) A business plan has not yet been prepared for the three Brookwood Cemetery companies and their progress is explained in the Group Business Plan. Woking Necropolis and Mausoleum Limited, the holding company was only formed in December 2014 and did not require audited accounts although management accounts have been prepared. The audited accounts for Brookwood Park Limited (the trading company of the cemetery) and Brookwood Cemetery Limited for 2014 are also on the Group s website. The Thameswey Group organisation chart is shown in Schedule 1 of the Group Business Plan and is included in the individual company plans. The Council established the Thameswey Group of companies to assist in the delivery of some of the Council s highest priorities. In establishing the Thameswey Group the Council took a longterm view on investment in infrastructure and housing with the intention of securing benefit for the residents of the Borough, whether the activity was undertaken within the Borough or elsewhere. This report continues the narrative for that corporate objective and takes account of current market and economic conditions. The Business Plan periods vary in length depending on the Company, the type of projects and the life of those projects; most are rolling budgets which are updated annually. The benefits for Borough residents through these activities may be summarised as: 1 EE15-063

2 Income from Loan Margins The Council provides loans to some Thameswey Group Companies. In order to recognise the lending risk a risk premium is applied to some loans which result in a benefit to the Borough. The loans are provided to the Companies at a margin on the interest rate WBC pays to the Public Works Loan Board (PWLB). The benefit to Council Tax taxpayers in the Borough during 2016 if the attached business plans are approved will be 1,633,361 which is equivalent to at Band D (based on July 2015 cost of funds and 2015/16 tax base). Schedule 1 shows a breakdown of the WBC income from loan margins. Loan Arrangement Fees Since TCMK invests funds outside the Borough TCMK is also charged a 1% arrangement fee on loans, this provides a benefit to the Borough by reducing treasury costs. In ,000 was charged to TCMK by WBC as arrangement fees. The 2015 budget for TCMK provides for an additional 2.5m of loan finance. This will therefore provide 25,000 in loan arrangement fees to WBC in Management Fee for Housing Revenue Account The majority of the homes owned by Thameswey Housing Limited (THL) are now managed and maintained by the Council s Managing Agents, New Vision Homes (NVH). The NVH contract cost per property is consequently recharged to THL by WBC on a quarterly basis. The charge to THL includes the cost of the NVH contract and a contribution of 30 per property for the cost of the WBC contract management team. THL is expected to make a contribution of 85,000 during 2014, rising to 102,000 in 2015 for the management fees. Assessment of Loans & Investments In their 2011/12 report, KPMG, the Council s auditors recommended that an assessment should be completed annually to determine whether any of the Council loans to the Group companies or investments therein should be impaired. This analysis has been carried out with the conclusion that no impairment is required for the purposes of the Council s 2013/14 Accounts. Thameswey Housing Limited (THL) Rent and tenancy strategy The THL rent and tenancy strategy, outlined in its business plan, provides for future tenancies to be assured short-hold and for some occupations to be by way of licence. It is important for THL to have flexibility in its day to day acquisition, development and operational arrangements to ensure it can continue to contribute towards meeting the Borough s housing need set out in the Council s Housing Strategy. It is clear that different parts of the community have a need for differing housing solutions at varying prices. A Council Guideline has been compiled as a purchasing strategy for THL in helping meet housing needs in the Borough; this Guideline has been considered by the THL Board and was approved subject to a few minor amendments and is attached as an appendix to the THL business plan. THL assists WBC by providing: Affordable Housing at Intermediate Rental within the Borough; Transitional Rented Accommodation for individuals who have recently left an institutional background or are otherwise significantly disadvantaged; 2

3 75 additional affordable homes (by both purchase and development) over the next few years in relation to the new Brookwood Farm Development section 106 housing allocation; 60 additional affordable homes (by both purchase and development) in relation to the Victoria Square development affordable housing allocation; and Bed and breakfast facilities that WBC will be able to use as temporary accommodation to house people within the Borough in urgent need of accommodation. Support for Energy & Environmental Projects Thameswey Limited (TL) charges a project fee for its intellectual property; this fee is set at up to 4% of the capital expenditure on new works. This project fee is then set aside as a reserve for TL to support energy, environmental, housing and economic initiatives in Woking in furtherance of the Council s Climate Change Strategy, Housing Strategy and Local Plan. TL also uses funds to support subsidiary companies where required. The total one off project fees receivable from 2006 up to the end of 2014 are estimated to be 1,066,000. The forecast project fees for 2015 are 45,000 equivalent to 1.17 per Band D Council Tax taxpayer based on the 2014/15 tax base. Carbon Dioxide (CO 2 ) Savings The Thameswey Group s energy companies focus on supplying renewable and sustainable energy and reducing greenhouse gas emissions. CO 2 is one of a number of greenhouse gases that contribute to man-made climate change. CO 2 equivalent emissions savings are achieved by generating energy through sustainable sources, for example by using a combined heat and power engine (CHP) or solar photovoltaic panels. The savings are calculated as the difference between the CO 2 emitted in producing each unit of energy and the amount of CO 2 (and other greenhouse gases) emitted in the production of conventional grid energy. During 2015 the Thameswey Group saved 3,246 tonnes of carbon dioxide emissions through the generation of energy across its sites. A further 826 tonnes was saved through the installation of energy efficiency measures in homes across Surrey via Action Surrey. Other Fees and Income The Thameswey Group also contribute financially towards the Borough in other ways including: WBC charges TL 10,000 per annum for use of the Thameswey Trademark; TSCL and TMSL both rent premises from WBC for their offices/workshop at commercial open market rates; THL pays ground rent for the Middle Walk flats to WBC; TSCL, TEL and TMSL all pay National Non Domestic Rates to WBC, for the year 2014/15 these will total 48,207; and When THL develops new affordable housing in the Borough WBC will benefit from the Governments New Homes Bonus of approximately 8,612 per home (based on the 2012/13 grants). A summary of group benefits to WBC is contained in Schedule 3. Main Proposals in the Business Plans: The THL Business Plan has a request for funding of 15m for 2016 and 5.0m for The TCMK Business Plan has a request for loan finance of 3.2m for

4 Reasons for Decision To recommend to Council the approval of the Business Plans for each of the Thameswey Group companies Recommendations The Executive is requested to: RECOMMEND to Council That: - i) the Thameswey Group Business Plan , as set out at Appendix 1 to the report, be approved; ii) iii) iv) the Thameswey Energy Limited Business Plan , as set out at Appendix 2 to the report, be approved; the Thameswey Central Milton Keynes Limited Business Plan , as set out at Appendix 3 to the report, be approved; the Thameswey Solar Limited Business Plan , as set out at Appendix 4 to the report, be approved; v) the Thameswey Housing Limited & Thameswey Guest Houses Limited Business Plan , as set out at Appendix 5 to the report, be approved; vi) vii) the Thameswey Developments Limited Business Plan 2016, as set out at Appendix 6 to the report, be approved; the Thameswey Maintenance Services Limited Business Plan , as set out at Appendix 7 to the report, be approved; viii) the Thameswey Sustainable Communities Limited Business Plan , as set out at Appendix 8 to the report, be approved; and ix) the Rutland Joint Venture Companies Business Plan 2016, as set out at Appendix 9 to the report, be approved. This item will need to be dealt with by way of a recommendation to the Council. Background Papers: Previous Thameswey Business Plans and Statutory Accounts and Reports Sustainability Impact Assessment Equalities Impact Assessment Reporting Person: Ray Morgan, Chief Executive Ext. 3333, E Mail: Ray.Morgan@woking.gov.uk Douglas Spinks, Deputy Chief Executive Ext. 3440, E Mail: Douglas.Spinks@woking.gov.uk Sue Barham, Strategic Director Ext. 3810, E Mail: Sue.Barham@woking.gov.uk 4

5 Mark Rolt, Strategic Director Ext. 3002, E Mail: Mark.Rolt@woking.gov.uk Peter Bryant, Head of Democratic and Legal Services/Monitoring Officer Ext. 3030, E Mail: Peter.Bryant@woking.gov.uk Leigh Clarke, Financial Services Manager Ext. 3277, E Mail: Leigh.Clarke@woking.gov.uk Contact Person: Ray Morgan, Chief Executive Ext. 3333, E Mail: Ray.Morgan@woking.gov.uk Graham Darsley (Thameswey), Group Finance Director Tel , E Mail: graham.darsley@thamesweygroup.co.uk Mark Rolt, Strategic Director Ext. 3002, E Mail: Mark.Rolt@woking.gov.uk Portfolio Holder: Cllr John Kingsbury E Mail: cllrjohn.kingsbury@woking.gov.uk Shadow Portfolio Holder: Cllr Ian Johnson E Mail:cllrian.johnson@woking.gov.uk Date Published: 11 November

6 Schedule 1 WBC Income from Loan Margins 6

7 Schedule 2 The purchase of Brookwood Cemetery was financed by a loan facility granted by Council resolution on 24 th November The Loan Facility is up to 5.5m for 75 years with the first 25 years being interest only and the subsequent 50 years based on a 50 year annuity. By the end of August m of the loan had been used. The resolution also approved new share capital of up to 500,000 which is yet to be drawn. 7

8 Schedule 3 Summary of Benefits to WBC 8

9 Thameswey Sustainable Communities Limited REPORT ENDS EE

10 Equality Impact Assessment The purpose of this assessment is to improve the work of the Council by making sure that it does not discriminate against any individual or group and that, where possible, it promotes equality. The Council has a legal duty to comply with equalities legislation and this template enables you to consider the impact (positive or negative) a strategy, policy, project or service may have upon the protected groups. Eliminate discriminatio n Positive impact? Advance equality Good relations Negative impact? No specific impact What will the impact be? If the impact is negative how can it be mitigated? (action) THIS SECTION NEEDS TO BE COMPLETED AS EVIDENCE OF WHAT THE POSITIVE IMPACT IS OR WHAT ACTIONS ARE BEING TAKEN TO MITIGATE ANY NEGATIVE IMPACTS Gender Men Women Gender Reassignment Race White Mixed/Multiple ethnic groups Asian/Asian British Black/African/Caribbean/ Black British Gypsies / travellers Other ethnic group 10

11 Eliminate discriminatio n Positive impact? Advance equality Good relations Negative impact? No specific impact What will the impact be? If the impact is negative how can it be mitigated? (action) THIS SECTION NEEDS TO BE COMPLETED AS EVIDENCE OF WHAT THE POSITIVE IMPACT IS OR WHAT ACTIONS ARE BEING TAKEN TO MITIGATE ANY NEGATIVE IMPACTS Disability Sexual Orientation Age Religion or Belief Physical Sensory Learning Difficulties Mental Health Lesbian, gay men, bisexual Older people (50+) Younger people (16-25) Faith Groups Pregnancy & maternity Marriage & Civil Partnership Socio-economic Background The purpose of the Equality Impact Assessment is to improve the work of the Council by making sure it does not discriminate against any individual or group and that, where possible, it promotes equality. The assessment is quick and straightforward to undertake but it is an important step to make sure that individuals and teams think carefully about the likely impact of their work on people in Woking and take action to improve strategies, policies, services and projects, where appropriate. Further details and guidance on completing the form are available. 11

12 Sustainability Impact Assessment Officers preparing a committee report are required to complete a Sustainability Impact Assessment. Sustainability is one of the Council s cross-cutting themes and the Council has made a corporate commitment to address the social, economic and environmental effects of activities across Business Units. The purpose of this Impact Assessment is to record any positive or negative impacts this decision, project or programme is likely to have on each of the Council s Sustainability Themes. For assistance with completing the Impact Assessment, please refer to the instructions below. Further details and guidance on completing the form are available. Theme (Potential impacts of the project) Use of energy, water, minerals and materials Positive Impact Negative Impact No specific impact What will the impact be? If the impact is negative, how can it be mitigated? (action) Waste generation / sustainable waste management Pollution to air, land and water Factors that contribute to Climate Change Protection of and access to the natural environment Travel choices that do not rely on the car A strong, diverse and sustainable local economy Meet local needs locally Opportunities for education and information Provision of appropriate and sustainable housing Personal safety and reduced fear of crime Equality in health and good health Access to cultural and leisure facilities Social inclusion / engage and consult communities Equal opportunities for the whole community Contribute to Woking s pride of place x 12