Agenda and minutes

            Apologies for inability to attend were reported from Councillors Haire, McCabe and O Muilleoir.

No declarations of interest were reported.

(Mr J. McGrillen, Director of Development, attended in connection with this item.)

            The Committee considered the undernoted report:

“1        Relevant Background Information

1.1       Members will be aware that responsibility for Urban Regeneration and Community Development will transfer to the new Councils on 1 April 2015.

1.2       Whilst DSD will retain responsibility for the overarching policy on urban regeneration and community development, and will be responsible for regionally significant interventions, the transfer will incorporate four main areas:

·        Area Based Regeneration – Neighbourhood Renewal, Masterplans and Frameworks

·        Physical Development – Comprehensive Development, Public Realm / Environmental Improvements and Urban Development Grants (UDGs)

·        Community Development – Community Support Programmes, Belfast Area Partnerships & Community Investment Fund

·        Transfer and Maintenance of Assets – This consists of the current DSD land bank, public spaces, the management and maintenance of the Lagan Weir and the management of the river between the Lagan and Stranmillis Weirs

1.3       In order to facilitate effective change management, a two stage transfer process has been agreed through the former Statutory Transition Committee and with DSD:

·        Transition – to focus on the practical arrangements/decisions necessary for Council to maintain and deliver agreed transferred services and resources on 1 April 2015. This will provide service continuity and allow  planning to take place for transformation  over the 2015-2017 period.

·        Transformation – to focus on developing the future vision, outcomes and delivery models for urban regeneration and community development and to align with the Community Planning process, post 2017.

2          Key Issues

2.1       In preparation for the transfer of functions, DSD has formulated a resource allocation model to distribute its current resources across the 11 new Councils. This distribution model is principally based on urban population and levels of deprivation. A prospective budget reduction of 4% across the NI Executive Departments was also factored into the model.

2.2       Under this Regional Allocation Model the new Belfast City Council area will receive a total allocation of £20,418,000(indicative at present) as set out in Table 1 below. The allocation will however transfer as part of the rate and it will be for the new Council to decide how this money is ultimately allocated.

            Table 1: DSD Allocation for Belfast City Council:

2.3       Over the last number of weeks, Council officers have been conducting a due diligence exercise which has involved analysing the average DSD expenditure in the new Council areas over the past seven financial years. This analysis is set out in the table below which clearly indicates that Belfast is the only area which will experience a reduction in the level of resource allocation in comparison to previous years. It should be noted however that expenditure (particularly capital) varies significantly from year to year in some areas.

            Table 2: Summary of DSD’s Historic Spend within new Council Cluster Areas:

            The Committee was reminded that the Shadow Council at its inaugural meeting on 11th June had agreed to select a traditional committee form of governance which would be made up of 4 standing Committees of 20 members each.  The Shadow Council had approved also the draft Corporate Plan for the shadow period which included proposed Terms of Reference for each of the 4 standing committees.

            The Members were advised that the role of the Shadow Council was principally to prepare the organisation to assume its full powers and functions in the extended boundary area on 1st April, 2015.  The Shadow Strategic Policy and Resources Committee would therefore take the lead role in putting in place the relevant structures and resources for the new council.  That would include the development of:

·   new decision making structures, including new political management arrangements and supporting organisational development and design;

·   a new corporate plan setting out the vision and priorities for the Council for the next number of years, taking account of the Council’s emerging role in the development and implementation of the Community Plan; and

·   the setting of the budget for the new council, including revenue estimates, the medium-term financial plan, the Capital Programme and the striking of the district rate.

            The Committee would oversee also a programme of Member and officer capacity building and be required to respond to any relevant emerging legislation and guidance.  It was envisaged that, as the year progressed, the work of the Committee would be intense, particularly as it approached the rate setting deadline in the new year up until the new Council took effect on 1st April, 2015.  At this time the recommendation was that the Committee should meet once a month but that might have to be reviewed later in the year.  Also, since specific pieces of work emerged, it might be necessary to establish one or two short-term Working Groups.  Further reports on that would be brought to the Committee as necessary.

            Accordingly, the Committee was requested to approve the undernoted draft Terms of Reference for the Shadow Strategic Policy and Resources Committee:

Appendix 1

Terms of Reference for Shadow Strategic Policy and

Resources Committee

Role

The Shadow Strategic Policy & Resources Committee will take decisions or make recommendations in relation to budgets, post 2015 governance arrangements, organisational development and design, corporate planning and performance processes.

Governance

The Shadow Strategic Policy and Resources Committee shall be responsible to the Council for the matters described below:-

·        Commence organisation development and design work including new temporary and future organisational structures.

·        Identify and design the preferred governance model for the new council (including the number, size and role of committees and area working groups, a method for filling positions of responsibility and the allocation of Special Responsibility Allowance).

·        Develop governance frameworks (including the Standing Orders, Scheme of Delegation and the Constitution).

·        Develop process for dealing with current and future contracts

·        Consider initial service budget estimates.

·        Submit Equality Scheme to Equality Commission

·        Develop a corporate and business plan for the  ...  view the full minutes text for item 4.

            The Committee considered the undernoted report:

“1     Purpose of Report

1.1    To introduce for Members the process for developing the Corporate Plan which will guide the work of the new Council from April 2015 onwards.

2       Relevant Background Information

2.1    As set out in the Committee’s terms of reference, a key task for the Strategic Policy & Resources Committee in the shadow year is to develop the corporate plan for the new Council.

The corporate plan is an important document for the new Council, as it sets out:

·        Members’ vision for the city and the organisation in the context of the emerging community plan for Belfast;

·        How we will deliver new functions and in new areas;

·        The priorities Members wish to see delivered during the Council term;

·        The ways in which Committees and departments will work together and with partners to deliver on these priorities;

·        The way the resources of the organisation in terms of money, people and assets, will be aligned to ensure delivery;

·        The measures that Members will use to manage the performance of the organisation and ensure and monitor improvement

·        How the council will deliver significant governance and organisational change (a separate report on the Committee’s agenda deals with this issue).

         Over the coming year, it will be important that Members are given the time and information that they need to lead the development of the new corporate plan in an evidence-based way and within the affordability limits established through the rate setting process. 

3       Key Issues

3.1    Setting and managing Council priorities – the planning framework

         The corporate plan is one of a number of strategic plans which Members will use to manage the new Council and the city. 

         At a city wide level Members will be leading the development of a strategic or community plan for Belfast, this will set out long-term objectives and priorities for the city and will be developed in partnership with other statutory bodies, communities and other stakeholders.  Amongst other things, the corporate plan will set out ways in which the Council will contribute to these city priorities.

         Within the organisation, the corporate plan sits along-side the Council’s financial management plans and strategies which show the ways in which financial resources will be used to deliver on Members priorities.

         The Council’s organisational development strategy, outlines the ways in which the capacity of the organisation will be developed in order to deliver on the priorities in the plan.

         Over the next year, Members will also decide on the way in which they wish to see services, departments and committees plan to deliver on the priorities in the corporate plan and how progress will be measured.  This may include area-based plans.

         A diagram setting out an illustrative example of how the different plans of the organisation may come together in 2015 is attached at Appendix 1.  Over the next year we will work with Members to refine this approach, in line with Members’ direction, the emerging processes for developing the community plan and the  ...  view the full minutes text for item 5.

            The Committee considered the undernoted report:

“1.0    Purpose

1.1    The purpose of this report is to agree the Council’s Organisational Development Strategy as a strategic framework for a far-reaching internal change programme and to agree the immediate priority areas for organisation restructuring.

2.0    Relevant Background Information

2.1    Members agreed in April 2014 that a far-reaching internal change programme of organisational development and design (to include a new organisation structure) should now be developed.

2.2    An organisational development (OD) strategy has therefore been developed as a strategic framework for this work. This strategy is the first step in developing a planned and systematic approach to enabling internal change and improvement.

2.3    The OD strategy will be one of the key strategic plans for the new council and its associated programme of work will form a significant part of the Shadow Policy and Resources Committee’s work.

3.0    Key Issues

         Priorities for Organisation Development

         The priorities for organisational development have been identified as a result of analysis of members’ ambitions and priorities, the external and internal environment, consultation through various internal workshops and development sessions and analysis of evidence gathered from our employee survey and IiP process. In addition, there are important ‘must do’ issues, in particular significant consideration was given to local government reform.

         The following four key areas for organisation development work have been identified:

·   organisation  - this includes reviewing our governance  and organisation structures including service delivery models

·   leadership – (both political and managerial leadership). This includes agreeing values and behaviours for BCC leaders; developing current and future leaders; managing and attracting talent; continuing work to ensure our workforce is representative of the community we serve; leading and effectively managing transformation and change; continuing to improve communication and engagement; and managing performance.

·   management - this involves supporting managers to effectively focus their role on relevant service and project delivery; vfm and our customers; managing  performance; understanding and managing political/member relations; delivering efficiencies; managing change; and communication with staff. We also need to support changes to manager’s role particularly in relation to neighbourhood working, clienting, revised service delivery models and working with partners.

·   skills – this involves developing leadership skills within our organisation around community leadership/planning; programme and project management; managing people and performance. We will also need to undertake a skills gap in the context of organisation redesign (e.g commissioning, commercial, workforce planning, economic and option appraisal skills) and source expertise required for city leadership (e.g. energy , digital expertise)

         Work has clearly started on some of the priorities set out in the strategy, such as LGR (transition, transformation, governance); service delivery models (Leisure and Waterfront Hall ); Member and officer capacity building; efficiency; and employee engagement

         This strategic framework for organisation development must however be aligned to other strategies, prioritised, resourced and communicated as a result of agreeing the strategic direction for the new council with members. This work will form an important aspect of the work of the Shadow Strategic Policy and Resources and Transformation Committees  ...  view the full minutes text for item 6.

            (With the exception of the Chief Executive Designate and the Senior Democratic Services Officer, all officers left the meeting while this item was under consideration)

            The Chief Executive Designate submitted for the Committee’s consideration the undernoted report:

“1.0    Purpose

1.1    The purpose of this report is to agree arrangements for the new Council’s senior management team pending a significant internal change programme which will include organisation restructuring. 

2.0    Relevant Background Information

         The handover between the existing Chief Executive and the new Chief Executive will be complete at the end of June 2014.

         Belfast City Council is facing significant corporate priorities and unprecedented change including:  

·        Transition and transformation related to local government reform - transfer of assets and staff from Castlereagh and Lisburn, transfer of new functions and powers and new governance arrangements

·        Internal change programme (organisation design and development)

·        Investment Programme

·        Leisure transformation

·        Review of Waterfront Hall delivery model

·        Efficiency programme

         Over the shadow period the management team will not only manage the business as usual/functions of the council and deliver key priorities but also manage the change process. 

         It is imperative therefore that a senior management team is in place to support the Chief Executive in the delivery of this unprecedented agenda.

         Currently the other new councils are considering their senior management teams and structures and creating and filling new posts.

         Belfast City Council is however different to other councils - it is not merging with two or three councils but rather extending its boundary. Unlike the other councils Belfast City Council is not in the position of having more than one post in a cluster of two or three councils with only one post being required in the new council.

         The Council’s staff are not at risk as a direct result of local government reform and will simply transfer from the existing Council to the new Council on vesting day. 

         The Council needs however to review its organisational structure to ensure it is aligned to governance arrangements and is fit to deliver members’ ambitions and priorities.

         Given the significant agenda of work and the scale of change during the shadow period and the Council’s particular circumstances (i.e that for the purposes of filling posts in the new council Belfast can be seen as a continuing local authority) the following is proposed:

·        The existing senior management team will operate in the same way as the agreed arrangements for the new Chief Executive in that directors will undertake duties relating to both the existing and new council. 

·        Realign the Council’s directors’ pay scale to ensure the appropriate relativity to the new pay scale for the new Chief Executive post.

·        Designate one of the existing directors to undertake a full deputising role for the Chief Executive for the shadow period/until the new organisation structure is agreed. Previously the full deputy role for the Chief Executive was assigned to the lead finance role and it is proposed to do so again (no other chief officer has expressed an interest and the  ...  view the full minutes text for item 7.

            The Director of Finance and Resources submitted for the Committee’s consideration the undernoted report:

“1     Relevant Background Information

1.1    Two of the key tasks for the Shadow SP&R Committee will be setting the district rate and agreeing the revenue and capital budgets for 2015/16.

1.2    This will be a complicated process with many issues needing to be addressed. The purpose of this report is to propose a process to support Members financial decision-making and to outline the key factors which they will be required to be considered.

2       Key Issues

2.1    Table 1 below summarises the key issues relating to the rate setting process for 2015/16. The top half of the table deals with the revenue and capital estimates and the bottom half addresses the factors which will determine how much income will be raised through the rates base.

2.2    Business as Usual: The recurring net cost of Council operations including front line, back office and infrastructure costs which is influenced by factors such as inflation, staff costs, staff numbers and new Member priorities.

2.3    Boundary Convergence: The cost of the delivering front line services to residents in the new Council boundary area. This will be driven by the costs of staff transferring, the costs of running and maintaining transferring assets and standards at which services are to be delivered.

         Given the complexities outlined above, departments started in April 2014 to develop and cost models of service delivery to the new boundary areas.

2.4    Transferring Functions: The cost of providing continuity of service to customers and citizens for those of services and functions which will transfer to the council from central government. Council officers are currently working with government officials to determine staffing levels, accommodation needs, ICT requirements, and so on.

Table 1

2.5    Leisure Transformation: The creation of revised Parks and Leisure budgets following the decision to create a Leisure Trust.

2.6    Organisational Design Impact: The creation of the new council will have an impact on departmental and corporate budgets through revised organisation structures, back office arrangements and accommodation requirements.

2.7    Capital Programme: The capital financing and revenue implications of the 2015/16 – 2017/18 Capital Programme which will include capital projects incorporating the new boundary area and capital expenditure strands of transferred functions.

2.8    Balance Sheet Impact: The revenue implications of movements in the council’s balance sheet resulting from the transfer of assets and liabilities associated with service convergence and transferred functions.    

2.9    Efficiency Target: The level of cash savings agreed by the council to be removed from the baseline estimates.

2.10  New Rate Base: The expanded rates base for the new council area which will include the gross rate income less losses (including allowances, vacancies, irrecoverables and cost of collection). The output will be an Estimated Penny Product for the new council Area. Council officers are currently working with LPS and the Institute of Revenue, Rating and Valuation to estimate the likely levels of rates income associated with the new rates base.

2.11  Rates Funding for Transferred  ...  view the full minutes text for item 8.

            The Committee was reminded that, as a result of local government reform, the current number of councils had been streamlined from 26 to 11.  In many instances, merging council areas had differential district rate levels which could result in many ratepayers experiencing an increase in rates as a result of the reorganisation.  The Northern Ireland Executive had agreed to allocate £30million to fund transitional arrangements to manage rates convergence between those council areas which might have different rate levels and were coming together as a result of the reform.

            The Director of Finance and Resources reported that the Department of Finance and Personnel and the Land and Property Services agency had developed initial draft proposals for a rates relief scheme for those ratepayers who were likely to face a sudden increase in their district rate.  The Department had recently issued those proposals for consultation with responses sought by 19th August, 2014.  As part of the rates relief scheme, the Department were proposing that a specified discount be applied to the 2015/16 District Rate for both domestic and non-domestic properties.  The consultation document outlined a number of options in regard to the percentages of discount to be applied; and the duration of the scheme, for example, ranging from 1 till 4 years.  Council officers were currently reviewing the options which had been put forward and analysing the potential impact upon those ratepayers transferring to Belfast.  It was the intention that a detailed report on the Council’s response to the consultation would be submitted to the Committee in August for Members’ consideration.

            The Committee noted the information which had been provided.

            The Committee noted the contents of a report in relation to the financial reporting for quarter 4 which had been submitted to and agreed by the Strategic Policy and Resources Committee on 19th June. 

            The Chief Executive Designate reminded the Committee that an important element and benefit of local government reform would be the transfer of a number of new place-shaping functions and powers from central government departments to local government in April, 2015.  The new Councils would be given operational responsibility for spatial planning, regeneration and community development, off-street car parks, additional regulatory housing functions, including Houses of Multiple Occupations (HMOs) and housing unfitness, as well as an enhanced role in supporting local economic development and tourism.

            The transfer of such functions, coupled with the new statutory community planning powers, would further enhance the ability of councils and local elected members to respond to the needs of local communities and shape, in partnership with others, the future development of their city.  In agreeing the package of functions to transfer from central to local government, the Northern Ireland Executive had agreed also the following guiding principles which would underpin the transfer of functions/powers to councils:

            (1) would be sufficiently funded at point of transfer;

            (2) would be rates neutral at point of transfer; and

            (3) would be fit-for-purpose at point of transfer.

            In order to establish a clear understanding of what it was transferring, Deloitte had been commissioned by the regional Transfer of Functions Working Group to undertake a detailed due diligence assessment of the baseline resources, for example, the budget, staffing, assets and liabilities attached to those functions and powers transferring to local government.  The objective of the due diligence work was to provide the local government sector with details and assurances regarding transferring budgets and to highlight issues which needed further work.  It was pointed out that some of the actual figures, including specified notional costs, were under review with the Department for Finance and Personnel and other government departments and should not be taken as final definitive figures.

            The Chief Executive Designate explained that the Due Diligence assessment provided a regional overview of the resources to transfer and did not set out the proposed resource allocations across the 11 new councils, including Belfast.  The allocation of resources by individual central government departments would be a decision for each Minister.  To date, the Department for Social Development had been the only department which had issued specific proposals in regards to the allocation of resources which had been considered earlier in the meeting by the Committee. 

            The Department of the Environment had confirmed that each of the other transferring departments would present in early summer 2014 proposals regarding budget allocations, with final allocations late in autumn 2014 in line with the Council’s rate setting process. 

            The Chief Executive Designate submitted for the information of the Members a draft critical decision route map which had been prepared by the Department of the Environment and which outlined how a number of outstanding transfer issues, highlighted in the Due Diligence Report, would be progressed.  She explained that Council officers were already in intensive engagement with the respective transferring functions departments to carry out its own due  ...  view the full minutes text for item 11.

            The Committee noted the contents of a report in relation to the Financial Accounts of the Council, including the Annual Governance Statement, for 2013/14 which had been approved by the Strategic Policy and Resources Committee at its meeting on 19th June.

            The Director of Finance and Resources submitted for the Committee’s consideration a report on the Financial Statements of the Statutory Transition Committee, including the Annual Governance Statement, for 2013/14.  He pointed out that the Financial Statements were an important element of the Council’s overall corporate governance framework as they provided assurance to Members and rate payers on the stewardship of the Statutory Transition Committee’s finances and its financial position.

            The Director reported that the financial statements for the year ended 31st March, 2014, a copy of which had been circulated, had been prepared in line with the Code of Practice on Local Authority Accounting in the United Kingdom 2013/14 based on International Financial Reporting Standards and the Department of the Environment Accounts Directive, Circular LG 19/14.  He confirmed that the Statement of Accounts for the year ended 31st March, 2014 had been prepared in the form directed by the Department and in his opinion the Statement of Accounts gave a true and fair view of the income and expenditure and cash flows for the financial year and the financial position as at the end of the financial year.

            He explained that the Financial Statements had included the Statutory Transition Committee’s Annual Governance Statement for the year 2013/14, which had been prepared in line with the Accounts Directive provided by the Department of the Environment and Northern Ireland Audit Office Guidance and was consistent with the principles of the CIPFA/SOLACE Framework ‘Delivering Good Governance in Local Government’.  The Annual Governance Statement was approved by the Chair of the Strategic Policy and Resources Committee, the Chief Executive Designate and the Director of Finance and Resources and was subject to review by the Northern Ireland Audit Office as part of its annual audit.  During the period till 31st March, 2014, the Statutory Transition Committee had incurred costs of £10,754 and had received income from Belfast City Council of £10,754.

            The Committee approved the Financial Statements and incorporated Annual Governance Statement for the Statutory Transition Committee for 2013/14.

            The Committee was reminded that the Council had agreed to a recess period in July, 2014.  The next meeting of committees would therefore be held in August where a number of key consultation documents, for example, Standing Orders, would be presented, together with initial preparatory work on the 2015/16 rates setting process.  The work to inform the Committee papers would require consultation with party groups, party group leaders and the Budget and Transformation Panel.  Those briefings would be scheduled for the beginning of the month, with a view to holding Committee meetings between 15th and 29th August.  That included 2 meetings of the Shadow Strategic Policy and Resources Committee, the first of which would take place on 15th August and the second on 29th August.  That would ensure that the Council complied with consultation deadlines which had been imposed by the Department of the Environment. 

            The Members were reminded that the legislation underpinning the Shadow Council set out new requirements around the number of days in advance that papers must be made available for meetings.  As a result of that, the Council meeting could not be held until 7 days after the last Committee meeting and therefore the proposed date for the Shadow Council meeting was Wednesday, 10th September.  The Chief Executive Designate pointed out that, in future, it would be preferable that all business of the Shadow Council took place within a period of 1 calendar month, with the Shadow Council meeting on the 2nd working day where possible.  Therefore, given that there were no similar legislative constraints affecting the timing of the current Council’s meeting and that the committee business would largely begin to ‘wind-down’, it was proposed that the scheduling of Shadow Council meetings should take precedence and be held in the first 2 weeks of each month, beginning in September.  That recommendation would be submitted to the current Council for approval and a revised schedule of meetings for both councils would be developed subsequently.

            The Committee approved the proposed timetable of meetings for August, agreed that the next Shadow Council meeting be held on Wednesday, 10th September and noted that agreement would be sought from the existing Council that Committee meetings would be re-arranged where necessary to give precedence to the Shadow Council.

            The Committee was advised that a request had been received from the Northern Ireland Independent Retail Trade Association for the Committee to receive a presentation in relation to its Programme for Local Government – Local First. 

            The Committee agreed to receive a deputation at its meeting to be held in September.