1.    Office to residential conversion to accommodate homeless families – Chesham House

2.    Citizens Advice Service and Budget Consultation

Reports attached.

Report: Comments of Overview and Scrutiny Board 

A.    Office to residential conversion to accommodate homeless families –    Chesham House

Presented by: Councillor Natasha Summers

Response:

Councillor Summers responded to each of the 12 considerations:

1.     There are concerns over the financial position of National Housing Group with a lack of liquidity and low levels of cash at bank demonstrated in the Cabinet report. The recent departure of three directors of the company, without apparent replacement, is also of concern. 

These concerns are noted.  

National Housing Group addresses liquidity concerns and recent director resignations. Last year, we managed three major projects, causing fluctuations in working capital. Now, our financial position is stable, with a consistent six-figure cash balance over the past 9 months and all properties fully let. 

Only two directors have resigned, neither involved in daily operations. Duncan Kreeger remains a director of Bryan Lloyd Limited, the ultimate beneficial owner of NHG. The core operational team is intact, ensuring business continuity and stability. 

2.     No agreement should be entered into for the site until more detail is known of the precise elements of the scheme or planning permission has been granted. 

This recommendation is accepted.  

To guarantee the quality of the proposed development, a detailed minimum standards document will be appended to the Agreement for Lease (AFL). This document will outline stringent build quality criteria and standards that the development must meet. All construction activities will comply with relevant building regulations and specifications to ensure that the completed project is fit for purpose. 

Additionally, necessary collateral and structural warranties will be assigned to the London Borough of Havering. These warranties will provide assurance that the development meets the required standards and will mitigate risks associated with potential non-compliance or structural issues. 

3.     More detail is required on whether the location of the development in an industrial estate is suitable and conducive to the quality of life of residents. In particular, more precise detail should be given of the noise mitigation measures to be taken to reduce disturbance from nearby industrial units. The Board is also concerned that the development may set an unwanted precedent for locating residential units in industrial areas. 

This recommendation is noted.  

The location of the proposed development has been evaluated to ensure its suitability and maintain the quality of life for future residents. The detached building is situated at the edge of the industrial estate, near residential houses on Cedar Road and adjacent to the newly constructed residential development, merchant's yard. 

To address potential concerns regarding noise and industrial disturbance, comprehensive noise assessments will be conducted. The findings will be reported transparently, and any identified issues will be addressed through mitigation strategies that comply with all necessary standards and regulations. These measures aim to minimize disturbances and ensure a high quality of life for residents. Additionally, the development has been planned to avoid setting an undesirable precedent for residential units in industrial areas by taking into account the specific characteristics and boundaries of the location. 

4.     The Board is disappointed that it was not presented for scrutiny the legal advice received by Cabinet on this matter (this has since been provided) and feels that this significantly hindered the scrutiny process.  

This recommendation is noted.  

This appears to have been an administrative error in the publication of the documents. The documents have been provided by Democratic Services on the 8January 2025.  

5.     Confirmation should be given that the scheme will be solely for Havering residents. 

This recommendation is noted.  

The scheme will be used to fulfil the council's duty under the Housing Act 1996, Part VII. All occupants must demonstrate a local connection with Havering before moving in. 

6.     Further detail should be given on the quality aspects of the scheme and the risk of not reaching these should be established.   

This recommendation is noted.  

The council requires the conversion to meet detailed property standards before signing the lease agreement. 

7.     A specific explanation is requested of why Mercury Land Holdings does not have Public Liability Insurance and hence cannot be considered as an option for this scheme. 

This recommendation is noted.  

Mercury Land Holdings (MLH) has public liability insurance. However, MLH directors who are not council employees will not be covered for any reputational risk associated with housing homeless households. 

8.     Clarity should be given over whether Stamp Duty needs to be paid for the Chesham House development as the report is unclear on this point. 

This recommendation is noted.  

NHG must pay SDLT when signing the lease with the Council. According to the council’s tax advisors, the sublease to Queens Lettings and Management will be exempt from SDLT, but specific exemption authorization from HMRC is required. 

9.     It is essential that adequate security arrangements are in place to safeguard tenants at Chesham House, including external and internal CCTV cameras as required.  

This recommendation is accepted.  

We intend to replicate the security arrangements for our other hostel schemes. 

10.The Board requests to see any pre-planning application discussions that may have taken place. 

This recommendation is noted.  

The Cabinet isnot aware of any pre-planning application discussions; however prior approval will be sought in the normal way as a permitted development scheme with all the risk borne by National Housing Group. 

11.            Briefings on the development should be given as soon as possible to Strategic Planning Committee and to Places Overview and Scrutiny Committee (OSSC). The briefing to Places OSSC to cover compliance with housing law as part of the development. 

This recommendation is partially accepted.  

Briefings to the Strategic Planning Committee will be carried out by the applicants, NHG, however officers will arrange for future briefing to the Places OSSC on the development, subject to the agreement of the Chair.  

12.            Details should be provided on the impact of the scheme of the Council’s Risk Register. 

This recommendation is accepted. 

The Council has identified emergency bed and breakfast accommodation as a significant risk to children, families, reputation, and budgets. This scheme aims to mitigate these risks by providing good quality accommodation. 

B.    Citizens Advice Service and Budget Consultation

Response presented by Councillor Chris Wilkins

1.     That it be investigated whether S 106 or Community Infrastructure Levy funding from the Angel Way or Como Street developments can be used to support the Citizens Advice Service – either as a replacement for existing grant funding or as a means to provide accommodation for the service on either of these sites.

Cabinet Lead response: This recommendation will be considered at the February Cabinet Budget meeting.

2.     That next year’s budget consultation be presented to the Overview and Scrutiny Board, in draft form, in order that this can be scrutinised and suggestions made, prior to its going live.

Cabinet agreed to this recommendation

A.     Comments of Overview and Scrutiny Board on Requisition of Cabinet Decision - Office to residential conversion to accommodate homeless families – Chesham House

Cabinet:

Upheld the original decision and responded to the comments of the Overview & Scrutiny Board

B.     Comments of Overview and Scrutiny Board on Citizens Advice Service and Budget Consultation

3.     That it be investigated whether S 106 or Community Infrastructure Levy funding from the Angel Way or Como Street developments can be used to support the Citizens Advice Service – either as a replacement for existing grant funding or as a means to provide accommodation for the service on either of these sites.

Cabinet response: This recommendation will be considered at the February Cabinet Budget meeting.

4.     That next year’s budget consultation be presented to the Overview and Scrutiny Board, in draft form, in order that this can be scrutinised and suggestions made, prior to its going live.

Cabinet agreed to this recommendation