That Cabinet:

1.    Approved the inclusion of a budget of £63.3m equity for the scheme together with a budget of £50.5m for potential land acquisition/CPO costs within the proposed HRA capital programme that will be considered by Cabinet in February 2018 in the annual rent setting and capital programme report and this is recommended to Council for final approval in February 2018.

2.    Agreed to award Preferred Bidder status to BIDDER C. Subject to the approval of the required budget and funding at recommendation 1 above, that Cabinet:

3.    Agreed to establish a JVLLP for the purpose of meeting the Council’s regeneration objectives for the 12 HRA sites by entering into a Members’ Agreement with BIDDER C on the basis of the Business Case and Legal Summary contained in the Exempt Agenda Report.

4.    Agreed to delegate to the Lead Member for Housing, after consultation with the Director of Neighbourhoods, the authority to agree the name of the JVLLP, negotiate the final detailed terms of the agreements being entered into, and authority to agree that the Council enter into the following agreements:

 Members’ Agreement;

 Development Agreement;

 Any ancillary agreements or documents necessary to give effect to the setting up of the JVLLP in accordance with this Report and its appendices (including the Legal Summary appended to the Exempt Agenda Report).

5.    Authorised the JVLLP to enter into the Development Management Agreement with BIDDER C when in agreed form.

6.    Agreed to delegate to the Lead Member for Housing, after consultation with the Director of Neighbourhoods, authority to finalise agreement on the terms of the Development Management Agreement referred to in recommendation 5 on behalf of the Council as Member of the JVLLP established in accordance with recommendation 4.

7.    Agreed to delegate to the Lead Member for Housing, after consultation with the Director of Neighbourhoods, authority to approve the first Business Plan of the JVLLP on behalf of the Council.

8.    Authorise the disposal of land to the JVLLP on the terms set out in this report, subject to the approval of the Secretary of State where required, (as detailed in the Land disposal paragraphs of the Legal Implications section of this report) and agree to delegate authority to the Lead Member for Housing, after consultation with the Director of Neighbourhoods, the authority to finalise the terms of such disposals.

9.    Authorised the Director of Neighbourhoods to consider the appropriation of land for planning purposes, subject to agreement of the Secretary of State, to facilitate the redevelopment of the 12 Sites and approve an application to the Secretary of State for appropriation under section 19(2) of the Housing Act 1985 and potentially appropriate back to housing purposes all or part of the land as may be considered appropriate in due course. (The precise areas of land to be appropriated to be decided by the Director of Neighbourhoods).

10. Recommends to full Council to make an application to the Secretary of State, where required, for the disposal of property and land (the precise areas of land to be decided by the Lead Member for Housing after consultation with the Director of Neighbourhoods) under section 32(2) of the Housing Act 1985.

11. Noted the updated Consultation and Engagement strategy as detailed in paragraphs 9.1 to 9.13 of this report.

12. Noted the updated Equalities Impact Assessment as referred to in the Equalities Implications section of this report.

13. Noted the update provided to Cabinet in the Local Lettings Plan report as it relates to these decisions.

14. Agreed to delegate to the Lead Member for Housing, after consultation with the Director of Neighbourhoods, authority to approve the consultation and communication plans for the regeneration of the 12 HRA Sites.

15. Authorised the Director of Finance to provide state aid compliant investment of equity/loans/capital expenditure the JVLLP within the funding provided in the Capital Programme and in accordance with the business plan and on the terms set out within the Member’s Agreement.

16. Agreed to delegate to the Leader, after consultation with the Chief Executive, the appointment of nominees to represent the Council on the JVLLP Board and indemnify them under the Local Authorities (Indemnities for Members and Officers) Order 2004 once the JVLLP has been set up.

17. Agreed, subject to approval of the over-arching Governance Report on the operation of the 12 Sites, Rainham and Bridge Close schemes, to the proposals for resolution of any Reserved Matters set out in such report.

18. Noted the governance framework and staff resources required to develop and deliver the 12 Sites and other economic development schemes also presented for consideration and approval by Cabinet in January 2018.

19. Noted an amendment to paragraph 4.25 of the report to read the following:

Tenants moving into a smaller property – qualifying under occupiers will qualify for an additional bedroom above their assessed need. For example:

• a tenant in a four bedroom property but the current housing need is assessed for a two bed, will be allowed to keep an additional bedroom and therefore will be offered a three bedroom property; or

• a tenant in a three bedroom property but the current housing need is assessed for a one bed, will be allowed to keep an additional bedroom and will therefore be offered a two bedroom property.

The conditions of the Allocation Policy must be met to qualify for this offer, and tenants should have a clear rent account and no history of anti-social or other unacceptable behaviour in their council tenancy.

Officers will complete an affordability assessment to ensure that the tenants can afford to pay the rent for the additional bedroom without discretionary housing payment on a long-term basis. Any shortfall will not be covered by the Council.

Councillor Damian White, Cabinet Member for Housing and Deputy Leader of the Council, introduced the report

In June 2016 and October 2016, Cabinet received reports regarding increasing the amount of affordable homes through the HRA and a Review of Older Persons Housing. As a result of the information provided to Cabinet the 12 sites for regeneration were identified and agreed along with the prioritisation of the sites within the programme.

In the reports to Cabinet identified above, information was provided on the extensive consultation process that had commenced with residents on the estates and how the feedback had been used to shape the final proposals being put forward. Since October 2016 the consultation process has continued with tenants and residents of the sites and has been extended to include residents who are neighbouring the sites. The report before Members provided Cabinet with a full update on the consultation process.

In those reports, Cabinet was provided with information on the review of procurement processes to deliver such a programme across the 12 initial sites (“the 12 Sites”) and consequently, the procurement commenced of a Joint Venture Partner via an OJEU compliant process (as implemented by the Public Contracts Regulations 2015) through competitive dialogue.

The report informed Cabinet of the outcome of that process and sought approval for the award of Preferred Bidder status to the highest scoring bidder to enter the confirming commitment stage to finalise the terms of the contract and also to award and enter into the contract on the basis set out in this report.

The report also summarised the rationale for the venture and provided information on the consultation and procurement processes. It also detailed the intended outcomes of the initiative and the legal and financial implications.

Reasons for the Decision:

By entering into a Joint Venture Limited Liability Partnership, the Council secures significant investment and specialism from the private sector whilst acquiring a degree of control over the scheme. The Council is therefore better placed to secure its regeneration objectives for the 12 Sites than if it relied solely on its role as planning authority and its land assembly powers and/or through a purely contractual arrangement with a private sector partner.

Other options considered:

A detailed options appraisal of the following options was undertaken:

·         Developer led - Council adopts a ‘do nothing’ approach

·         JVLLP with BIDDER C

·         Commence an OJEU process to select a developer

·         Commence an OJEU process to select a JVLLP partner

The following criteria were used:

·         Ensuring a comprehensive development

·         Direct influence over design and management standards

·         Ensuring delivery of infrastructure

·         Meeting deadlines to retain GLA Housing Funding

·         Minimising investment and risk

·         Obtaining a financial return from the scheme

·         Cost of procurement

That Cabinet:

1.    Approved the inclusion of a budget of £63.3m equity for the scheme together with a budget of £50.5m for potential land acquisition/CPO costs within the proposed HRA capital programme that will be considered by Cabinet in February 2018 in the annual rent setting and capital programme report and this is recommended to Council for final approval in February 2018.

2.    Agreed to award Preferred Bidder status to BIDDER C. Subject to the approval of the required budget and funding at recommendation 1 above, that Cabinet:

3.    Agreed to establish a JVLLP for the purpose of meeting the Council’s regeneration objectives for the 12 HRA sites by entering into a Members’ Agreement with BIDDER C on the basis of the Business Case and Legal Summary contained in the Exempt Agenda Report.

4.    Agreed to delegate to the Lead Member for Housing, after consultation with the Director of Neighbourhoods, the authority to agree the name of the JVLLP, negotiate the final detailed terms of the agreements being entered into, and authority to agree that the Council enter into the following agreements:

 Members’ Agreement;

 Development Agreement;

 Any ancillary agreements or documents necessary to give effect to the setting up of the JVLLP in accordance with this Report and its appendices (including the Legal Summary appended to the Exempt Agenda Report).

5.    Authorised the JVLLP to enter into the Development Management Agreement with BIDDER C when in agreed form.

6.    Agreed to delegate to the Lead Member for Housing, after consultation with the Director of Neighbourhoods, authority to finalise agreement on the terms of the Development Management Agreement referred to in recommendation 5 on behalf of the Council as Member of the JVLLP established in accordance with recommendation 4.

7.    Agreed to delegate to the Lead Member for Housing, after consultation with the Director of Neighbourhoods, authority to approve the first Business Plan of the JVLLP on behalf of the Council.

8.    Authorise the disposal of land to the JVLLP on the terms set out in this report, subject to the approval of the Secretary of State where required, (as detailed in the Land disposal paragraphs of the Legal Implications section of this report) and agree to delegate authority to the Lead Member for Housing, after consultation with the Director of Neighbourhoods, the authority to finalise the terms of such disposals.

9.    Authorised the Director of Neighbourhoods to consider the appropriation of land for planning purposes, subject to agreement of the Secretary of State, to facilitate the redevelopment of the 12 Sites and approve an application to the Secretary of State for appropriation under section 19(2) of the Housing Act 1985 and potentially appropriate back to housing purposes all or part of the land as may be considered appropriate in due course. (The precise areas of land to be appropriated to be decided by the Director of Neighbourhoods).

10. Recommends to full Council to make an application to the Secretary of State, where required, for the disposal of property and land (the precise areas of land to be decided by the Lead Member for Housing after consultation with the Director of Neighbourhoods) under section 32(2) of the Housing Act 1985.

11. Noted the updated Consultation and Engagement strategy as detailed in paragraphs 9.1 to 9.13 of this report.

12. Noted the updated Equalities Impact Assessment as referred to in the Equalities Implications section of this report.

13. Noted the update provided to Cabinet in the Local Lettings Plan report as it relates to these decisions.

14. Agreed to delegate to the Lead Member for Housing, after consultation with the Director of Neighbourhoods, authority to approve the consultation and communication plans for the regeneration of the 12 HRA Sites.

15. Authorised the Director of Finance to provide state aid compliant investment of equity/loans/capital expenditure the JVLLP within the funding provided in the Capital Programme and in accordance with the business plan and on the terms set out within the Member’s Agreement.

16. Agreed to delegate to the Leader, after consultation with the Chief Executive, the appointment of nominees to represent the Council on the JVLLP Board and indemnify them under the Local Authorities (Indemnities for Members and Officers) Order 2004 once the JVLLP has been set up.

17. Agreed, subject to approval of the over-arching Governance Report on the operation of the 12 Sites, Rainham and Bridge Close schemes, to the proposals for resolution of any Reserved Matters set out in such report.

18. Noted the governance framework and staff resources required to develop and deliver the 12 Sites and other economic development schemes also presented for consideration and approval by Cabinet in January 2018.

19. Noted an amendment to paragraph 4.25 of the report to read the following:

Tenants moving into a smaller property – qualifying under occupiers will qualify for an additional bedroom above their assessed need. For example:

• a tenant in a four bedroom property but the current housing need is assessed for a two bed, will be allowed to keep an additional bedroom and therefore will be offered a three bedroom property; or

• a tenant in a three bedroom property but the current housing need is assessed for a one bed, will be allowed to keep an additional bedroom and will therefore be offered a two bedroom property.

The conditions of the Allocation Policy must be met to qualify for this offer, and tenants should have a clear rent account and no history of anti-social or other unacceptable behaviour in their council tenancy.

Officers will complete an affordability assessment to ensure that the tenants can afford to pay the rent for the additional bedroom without discretionary housing payment on a long-term basis. Any shortfall will not be covered by the Council.