Agenda item

To receive any questions relating to items on the Agenda from members of the public and replies thereto.

The Chairman read a letter from Mr Quinn referring to Item 10 on the agenda which stated that:

In June last year, I asked Cabinet to consider changing the 3 Rivers programme to deliver affordable housing. I did not receive a direct answer, from Cabinet, at that meeting - but you did promise to reconsider my question when the programme was next on the agenda.

Fifteen months have passed and things have moved on quite a bit at the Council.

You have agreed your Mid Devon Corporate Plan for 2020-24, in which you say: “Our villages and towns need more affordable houses for local people. We aim to build more social rented housing and housing for purchase that is truly affordable”.  You now have a Cabinet Member for Climate Change, a Strategy and Action Plan - as well as a target for the Council to be Carbon Neutral by 2030.

These are positive aims for the Council - but not for your 3 Rivers Company.

It is clear from the report, that 3Rivers is still a commercial operation, where cost and profit are the only considerations.

However, the Company has not been able to deliver on its high profit aims - and changes are being undertaken. But why not take even more positive action….

Ditch the big-profit goals and use this Council resource for the Community. 

Make use of 3 Rivers to deliver your affordable housing plans and bring about those long-term community benefits you are aiming for.

Specify the construction materials and fittings for the homes you build, to ensure they meet the ‘greenest’ standards available. You cannot possibly ask other commercial enterprises in the District to do this, if you don’t.  Provide the lead!

Implement your aims by using 3 Rivers to build low-cost and low-carbon homes, and sell them to local people at minimal profit levels - making them truly affordable.

I repeat my June 2019 question: Will the Cabinet consider changing the aims of the 3 Rivers programme - from “Build for Maximum Profit” to “Build for Maximum Community Benefit”?

The Chairman then read a question on behalf of Cllr Wilce referring to Item 10 on the agenda. You will be aware that part of the recording of the cabinet meeting held on the 9th July, which  was open to the public, was edited by Officers, without any precedent, policy, or regulation, to remove reference to the potential liability to the Council of its loans to 3 Rivers. Members of the public were present, as was a member of the press. Since it is not possible to erase the memories of those persons present and given that the purpose of the recording is to provide a true and accurate record of the meeting, do you agree with me that this action is undemocratic and that the full recording of the meeting should be made public?

And, that having recently acknowledged that the loans made to 3 Rivers were ‘substantially without security’ can you update members on the current level of potential indebtedness of the Council and the security of those loans, given that the build at St George’s Court has not resumed?

Liz Pole referring to Item 8 on the agenda - Tiverton Eastern Urban Extension - Area B stated that she was concerned with the return to a Conservative Cabinet through what appears to be a grab of control, I am concerned about the level of competence and the confidence that local residents and taxpayers alike should be placing in the plan and the administration of it. The Tiverton Eastern Extension Masterplan is not going to be receiving any Community Infrastructure Levy and the so called affordable housing promised at 35% is now suggested in the document to be under threat from viability assessments. Last year I spoke to the Planning Committee about my concerns for the Cullompton Urban Extension Masterplan, where affordable housing was slashed from a promised 28% to just 10% and at that time I mentioned that the 2016 - 2020 Corporate Plan which had promised 250 new council houses had by that time last year only delivered 6 out of those 250 promised council houses.

Additionally communities have been subject to unwanted development due to failures in maintaining a 5 year land supply, evidence points to tax payers subsidy having to prop up the Council’s 3 Rivers commercial investments to the tune of potentially millions of pounds. Other evidence indicates that council tenants may ultimately have to pay for a £600k settlement which may possibly relate to the Turner Rise element or wherever that applies because there is a confidentiality agreement apparently. If that £600K has gone to the Housing Revenue Account, then presumably it will have to be recouped through rents from Council tenants? So I am concerned about the management of these housing projects and would like to have some assurance from the Cabinet that the people of Tiverton will be receiving the 35% of affordable housing that they are due under the current Eastern Urban Extension Masterplan.

The Chairman then read a letter he had received from the Liberal Democrats Group which again referred to Item 10 on the agenda:

In the year or more since you have been Leader,  the Council has given unsecured loans to 3 Rivers in excess of £9 million. During the same period the financial losses being incurred by the Company have increased at a rate that are now alarming.

These losses are primarily the result of continuing delays and cost overruns on the St George’s site in Tiverton. The losses being incurred on the St George’s site have increased from £250k a year ago to more than £1 million today. It is understood the main contractor on the St George’s site has not been on site for nearly six months and is in dispute with the Council. It is not clear when they might resume work. We understand that this may be 7^th September.

In consequence it very likely that the losses forecast for the St George’s site will be considerably in excess of the £1 million loss already incurred. These losses have to paid for by the taxpayer and now threaten the future delivery of key public services.

You have responded to this crisis by commissioning various reports, by changing the governance and financial control arrangements of the Company and, above all, by continually passing the blame onto senior officers and the Directors of the Company. None of this has addressed the fundamental issues relating to the losses being incurred by this Company.

You failed to stop the flow of Council loans to 3 Rivers until some £9 million had been lent. You have also failed to take the action necessary to deal with the continuing problems on the St George’s site.

During this period Cabinet Colleagues have repeatedly asked you to present and discuss your plans for the future of the Company and, in particular, for your plans for dealing with the problems on St George’s site. These requests have been met by your making yet more requests for reports from Senior Officers. Previous members of your Cabinet have put forward their own proposals for addressing these issues. These have been not been responded to.

This prevarication is putting the Council at risk and must come to an end.

Four questions now require urgent answers:-

1. When will the main contractor be returning to the St George’s site and what is the revised date of completion of the building works there?
2. What is the current revised forecast for the losses being incurred on the St George’s site?
3. What is your plan as Leader for controlling these losses?
4. What is your plan as Leader for the future of the 3Rivers Company?

The Chairman indicated that answers to questions would be provided when the items were debated.