Agenda item

It was noted that the Chairman of the Towns & Communities Overview & Scrutiny Committee had agreed pursuant to paragraph 18 of the Executive Procedure Rules that the report should be exempt both from the Forward Plan procedure and from call-in.

Councillor Roger Ramsey (Cabinet Member for Value) introduced the report

The Rainham Library and Lifelong Centre would be a catalyst project within the Rainham Compass regeneration scheme, providing a valuable community resource, additional residential units and supporting educational achievement within the Rainham area. The project was integrally linked with bringing the adjacent new Rainham Station bus interchange into use and with regeneration plans for the Broadway, where the existing library was located.

Site works and construction to ground floor slab had already been completed but progression to the main construction stage had been interrupted by the dissolution of the London Thames Gateway Development Corporation. However, following recent discussions with the GLA (that had inherited LTGDC’s role and assets), funding arrangements had now been agreed that would enable the main construction contract to be awarded and the scheme to be delivered by the Council, enabling completion of the project in early 2014.

Reasons for the decision:

The project was key to the Rainham Compass Regeneration scheme. Following an earlier start on site by LTGDC, the scheme was currently at risk of being ‘mothballed’ with foundations and floor slab already completed. The GLA had offered £2.2.m grant funding specifically for the purpose of progressing the construction and the additional £1.8m investment from the Council would cover the remaining funding gap. There was an option for the Council to recoup this additional funding, if it chose to do so, from selling the residential units on the open market.

Tenders for the scheme having been sought at the end of 2011, they had expired but the preferred contractor had agreed to hold their current tender price in the short term, thereby avoiding the need to repeat the tendering exercise if the contract could be awarded shortly.

Other options considered:

Pre-sale of the residential units on the open market was the original proposal but was no longer viable as a result of changes in Social Housing Grant.

Pre-sale of the residential units to a private investor had stimulated little interest

It was noted that a decision as to whether the housing accommodation to be provided (without which the scheme would not be viable) would become part of the Council’s housing stock or disposed of did not need to be taken yet.

Cabinet agreed:

1.                  To note and accept the grant funding offer of £2.2 million from the GLA to support completion of the project.

2.                  To authorise the Head of Legal Services to execute all legal formalities once decisions have been made by those with delegated authority, in agreement with the Cabinet Member for Value, to enable the Council to proceed with the scheme including:

·      The main grant agreement between GLA and the Council

·      Award of the main construction contract to Rooff Ltd

3.                  To recommend to Council that the Capital budget be increased by £1.8m funded through capital receipts, to secure development of the residential element of the Rainham Library scheme.