Agenda and draft minutes

To note any apologies for absence and substitutions.

There were no apologies for absence.

Councillor Haili was present virtualy.

There were no declarations of interest.

RESOLVED: That all items be taken in public as proposed.

To approve as a correct record the minutes of the meeting held on 5 October 2023.

RESOLVED: That the minutes of the meeting held on 5 October 2023 are agreed as a correct record of proceedings.

Peter George, Strategic Director of Economy and Sustainability; Ozay Ali, Interim Housing Development Transformation Director; and Phillip Bown, Director of Housing Development presented an update on Broadway Living to members.

The Committee noted that:

·       Broadway Living was the Council’s wholly owned Housing Development Company. It had been loaned money by the Council to develop genuinely affordable housing in the Borough.

·       The report provided to the Overview and Scrutiny Committee set out the risks and mitigation of these risks to the Council around Broadway Living’s business plan.

·       Brexit and the  COVID-19 pandemic had led to a reduction in the construction workforce, resulting in wage increases for construction workers and therefore corresponding inflation increases for projects. Materials costs had also increased, and since the inflationary increase costs had levelled off and not come down. This meant there was a viability gap between the construction cost of projects and the value of the housing stock the projects would generate.

·       The country had also left a long period of historically low interest rates, with interest rate increases also negatively impacting on project costs.

·       The Council had been granted £109 million of grants to build affordable homes. However the amount of grant that could be used per home had remained steady while the cost per unit had gone up.

·       The Council still aimed to build 4,000 genuinely affordable homes, but didn’t underestimate the scale of the challenge due to the changing market landscape.

·       As a response to these challenges some additional measures had been put into place to ensure that projects were deliverable. These included reviewing ‘hurdle rates’ – which involved putting hurdles into place like increasing the payback period – to test the viability of schemes. If schemes didn’t pass these hurdles with sufficient confidence then the schemes were re-evaluated.

Ozay Ali provided the Committee with further detail of the ‘hurdles’ and the options that could be considered. It was noted that when hurdles couldn’t be met for schemes, the schemes were reviewed. For example, could the mix of tenures be changed, could additional temporary accommodation be added to the scheme in order to bring general fund money into the picture, could the Council dispose of the scheme to another developer but retain nomination rights to any social housing on site. These options would be considered in detail by officers in order to make a decision on whether a scheme was viable or not.

Philip Browne explained to the Committee that the time that Broadway Living was set up, and when it attained the grants from the Greater London Authority, economic times were very different. Broadway Living and the Council were considering different ways of delivering and different governance models to assist with viability issues. For example, moving to become a Community Interest Company. Broadway Living had been given a generous allocation of Greater London Authority affordable housing grants however the funds were required to be spent by 2026.

The Committee asked Officers the following questions:

·       Was land supply a barrier to  ...  view the full minutes text for item 5.

Sam Bailey, Head of Democratic Services, introduced the 2022-23 Scrutiny Annual report. The Committee heard that the 2019 Statutory Guidance on Overview and Scrutiny in Local Authorities had recommended authorities prepare a Scrutiny Annual report and present it to Council. Prior to 2022-23, it was not felt that this was necessary in Ealing as each panel produced an in depth report at the end of the year with its recommendations and reasoning behind them, which was considered by Cabinet. However 2022-23 marked a change in approach and scrutiny panels instead had began focussing on individual themes and making recommendations according to the information heard at the meetings. At the same time, annual reports for the panels had been pared back. Therefore an annual report had been prepared summarising the work of all of the scrutiny panels, which would be presented to Council after consideration by the Overview and Scrutiny Committee.

The Committee noted the recommendation from the statutory guidance and were content that it was appropriate to draft a scrutiny annual report and present it to Council. However for future years, it would be preferable to deliver this report to Council earlier in the year – at the June or July Council meeting.

RESOLVED:

That the 2022-23 Scrutiny Annual Report (Appendix 1) is agreed.

RESOLVED: That the Overview and Scrutiny Committee Work Programme is agreed.