Minutes:
The Committee considered the undernoted report:
“1 Relevant Background Information
Members will be aware that at its meeting in February 2012 the Committee agreed that the Council should work together with Newtownabbey Borough Council to examine the feasibility of a sub-regional approach to the development of additional crematorium facilities. Newtownabbey Borough Council had already identified a site at the Doagh Road which was to be the subject of the feasibility study.
Cogent Consulting, were appointed to undertake a study on the feasibility of a sub-regional approach to the development of a new crematorium at the site identified by Newtownabbey Borough Council at Doagh Road, Newtownabbey. The findings of the feasibility study were presented to Members at a Special Committee meeting on the 18 February 2013.
Cogent have now completed the next stage of the process which was the financial and operational modelling of three of the options that were identified through the feasibility study. As part of this work Cogent undertook a benchmarking exercise of other crematoria that have established a PPP agreement. They also undertook primary research with private sector operators to scope potential PPP arrangements and facilitated a study visit to a number of crematoria in the south of England.
2 Key Issues
Findings of financial and operational modelling
We have now received a copy of the report which outlines the financial and operational modelling of the following options:
· Creation of a new crematorium in Newtownabbey by NBC and BCC;
· Creation of a new crematorium in Newtownabbey by the private sector; and
· Creation of a new crematorium in Newtownabbey by the public and private sectors (2 variations – BCC and NBC plus the private sector and NBC only plus the private sector).
Key conclusions arising from the operational and financial modelling analysis include:
· Whilst the creation and management of a new crematorium in Newtownabbey by NBC and BCC (Model 1) would provide a number of key benefits including facilitating a strategic focus on shared services between the Councils and the sharing of crematoria risk and costs, this will require the Councils to contribute significant financial resources towards the initial outlay costs.
· From the perspective of NBC, the most potentially economically advantageous option (in the long-term i.e. over 25+ years) is likely to involve the creation and management of a new crematorium in Newtownabbey in conjunction with the private sector (where the private sector rents the land). In such a situation, NBC would not incur any costs and would derive a steady income stream (the size of which would be dependent on the terms negotiated as part of the initial SLA). The Research Team does however note that such a model would not facilitate the Council facilitating a strategic focus on shared services;
· From the perspective of BCC, the analysis suggests that whilst its involvement in a PPP with NBC may be advantageous in the longer term (given the fact that the initial outlay costs would not be passed on to the rate payer and the Council would derive an income stream) the Research Team notes that such a PPP model is less economically advantageous to NBC in the longer terms (vis-à-vis entering into a PPP arrangement alone) and the private sector has expressed a level of reluctance to entering into such an arrangement; and
· The sensitivity analysis suggests that any change in the assumptions underpinning the modelling analysis is likely to have a material impact on the costs and benefits incurred by the partners involved in each model. As such, in the event that one or more of the Councils wish to enter into a PPP arrangement with the private sector, emphasis should be placed on negotiating as economically advantageous conditions as possible.
Based on the findings of the modelling it is clear that the most economically advantageous option for Newtownabbey BC is to enter a PPP. Initial conversations with NBC officers have indicated that their Members are supportive of this option and they are likely to pursue it. Belfast City Council Members have previously expressed a reluctance to pursue a PPP in relation to the delivery of cremation services and the modelling has indicated that a PPP involving both Councils is not likely to be the most economically advantageous or the most attractive to the private sector.
It is therefore proposed that at this point Members agree that Belfast City Council no longer pursue any of the options for the development of a new crematorium with Newtownabbey Borough Council.
Redevelopment of Belfast Crematorium at Roselawn
Members will be aware that the current crematorium is working well beyond design capacity and there are a number of deficiencies which are hampering the effective delivery of dignified cremation services. The initial feasibility study recommended that regardless of the preferred option, it is considered essential that development works take place at the City of Belfast crematorium. There are currently almost 2,800 cremations taking place annually and the crematorium was not designed to cope with this level. The benchmarking research shows that is 80% higher than the average number of cremations taking place at crematoria in GB. The private sector has indicated that once a crematorium is undertaking c1,500 cremations annually they will explore the options for extending their facilities.
Members will be aware that the redevelopment of the crematorium at Roselawn is currently a Stage 2 uncommitted project on the capital programme. The next step in the process will be to develop a strategic outline case for consideration by the Strategic Policy and Resources Committee.
Future cemetery provision
Members will be aware that the Council are currently exploring the potential of a site at Dundrod for future cemetery provision. Officers had hoped to bring a joint report on future cemetery and crematorium provision but this was not possible due to the receipt of a proposal from the option holder on the Dundrod site. Officers are currently considering the proposal and will bring a report to the Committee early in the New Year.
3 Resource Implications
Financial
The costs of any new crematorium have yet to be determined. At SP&R on 22nd November 2013 the project was confirmed to be at Stage 2 of the capital programme process i.e. is an uncommitted project which has not developed to the stage where permission can be sought for tender.
4 Equality and Good Relations Implications
There are currently no equality or good relation implications however this will continue to be reviewed as the project is developed.
5 Recommendations
(i) Note the findings of the report;
(ii) Agree that Belfast City Council will not at this point pursue any of the options for the development of a new crematorium with Newtownabbey Borough Council; and
(iii) Agree that a strategic outline case for the redevelopment and refurbishment of Roselawn Crematorium be developed for consideration by the SP&R Committee.”
After discussion, during which the Director indicated that a report, in respect of the feasibility of the Council developing burial lands at the Dundrod site, would be submitted for consideration at its meeting in January, the Committee adopted the recommendations within the report.