Agenda item

Report of the Head of Regeneration and Housing

The Cabinet considered the report of the Head of Regeneration and Housing which provided details of proposals for the creation of a wholly owned Council Housing Development Company which would therefore sit at the heart of our ambitions and aspirations, to create a great place to live and meet the following demand drivers:

·         Local Housing Need: Over 11,000 homes (all types and classifications) are required in and across Sefton in the medium to long term, this translates at a build rate of  circa 650 units per year;

·         Right for Business: The private and third sector already operate and provide housing at all levels, however supply is in shortfall currently (largely because of an inadequate supply of land, which the Council with good access to land and assets will help to unlock);

·         Sefton’s Communities: where the Council does elect to lead, develop and deliver housing it will do so with due consideration to each community effected and after significant appraisal and in consultation with communities.

Decision Made: That

(1)       approval in principle be given to the creation of a wholly owned Council Housing Development Company;

(2)       approval be given to the allocation of £200,000 from the Council’s Transformation Reserve, for the procurement of external advisors as set out in the report, in order to support the production of the business case and business plan for the most appropriate option for a housing  development company;

(3)       the management of the one-off revenue funding as referred to in Resolution 2 above be delegated to the Cabinet Member - Communities and Housing whom will receive detailed breakdown of this expenditure as chair of the Member Reference Group;

(4)       subject to the viability tests that will be set out within the Outline Business Case and Outline Business Plan (i.e. feasibility studies); the authority to commence with Full Business Case and Full Business Plan be delegated to Cabinet Member for Communities and Housing, provided viability tests undertaken as part of the feasibility stage prove favourable;

(5)       it be noted that the Cabinet will receive a further report and a request to implement the housing development company subject to the drafting, scrutiny and presentation of a satisfactory Full Business Case and Full Business Plan; and

(6)       itbe noted that the proposal was a Key Decision but had not been included in the Council's Forward Plan of Key Decisions. Consequently, the Leader of the Council and the Chair of the Overview and Scrutiny Committee (Regeneration and Skills) had been consulted under Rule 27 of the Access to Information Procedure Rules of the Constitution, to the decision being made by the Cabinet as a matter of urgency on the basis that it was impracticable to defer the decision until the commencement of the next Forward Plan because the short period of time within the project plan to undertake technical investigations combined with the need to proceed with a number of procurements for advisors, and the economic drivers to establish the Company to provide the choice and type of housing in the prevalent market conditions, resulting in a programme for delivery that is time bound.

Reasons for Decision:

Sefton is an ambitious Metropolitan Borough and part of the Liverpool City Region:

·         Resilient People and Place;

·         Growing, living and ageing well;

·         A great place to live, work and play;

·         Image, culture and environment

are four of the Council’s eight Strategic Priorities as set out under the draft Vision 2030, tackling the best start in life for our families and leading on housing choice remains a priority in order to deliver on these outcomes. Over the period of June and July 2016 the Council has been considering its role in the provision of housing throughout the Borough to complement an active third and private sector market; there is significant demand for housing sites and housing development within Sefton.

Over 11,000 housing units are required between the period of 2012 to 2030 in Sefton to meet with the local housing demand. The Housing and Communities Agency have further announced a national housing shortfall of circa 1m homes (of which 400,000 fall into affordable homes) whilst across the Liverpool City Region a total of  circa 50,000 housing units will be required in the medium term.

Alternative Options Considered and Rejected:

There have been a number of options explored at this pre-feasibility stage of the project, these are:

Option A

A wholly owned council housing development company, the preferred option.

Option B

Again a wholly owned company, however, utilising what is referred to as a Top-Company (a Top-Co a parent, holding or shell-company with subsidiaries).

Option C

A Joint Venture Company (JV). In this option the Council would procure a private and/or third sector partner to work with.