Part 1
______________________________________________________________
REPORT OF THE STRATEGIC DIRECTOR OF HOUSING AND PLANNING
______________________________________________________________
TO JOINT HOUSING AND CUSTOMER AND SUPPORT SERVICES LEAD
MEMBER 16TH April 2007
TO CABINET BRIEFING 24TH April 2007
TO CABINET MEETING
8TH May 2007
______________________________________________________________
TITLE: PENDLETON PRIVATE FINANCE INITIATIVE
______________________________________________________________
RECOMMENDATIONS: Cabinet approves:
1. The extension of Ernst & Young’s contract, for the duration of the procurement of
the PFI contractor until the date of financial close and the PFI contract going live
2. The suggested procurement method for legal advisor support, for Outline
Business Case development through to the date of financial close and the PFI
contract going live
3. The suggested approach to engage and/or procure insurance advisors for Outline
Business Case development through to contract award, subject to this expertise
not being available from internal resources
4. The suggested approach to engage and/or procure a design champion for
Outline Business Case development through to the date of financial close and the
PFI contract going live, subject to further investigation in relation to the options
available
5. The completion of the remaining 40% stock condition survey and specialist
surveys
6. The arrangements for continued advice and support from Plus Property
Solutions, until a technical advisor has been appointed through the OJEU
process
7. The suggested procurement of title investigation work
8. That a separate report will be prepared on the commitments arising for the
Council in terms of required investment, not only for PFI but all the strands of the
Housing Investment Strategy.
9. The establishment of appropriate governance arrangements that allow the
Council to lead, manage and monitor the performance and progress of the
Housing PFI initiative with the Council’s Cabinet acting as the decision-making
body.
10. The suggested composition of the PFI Project Team, as outlined within the detail
of the report
11. The suggested changes to the stakeholder governance arrangements, as
outlined within the detail of the report
12. The continued development of sites in the Pendleton area for early re-provision
13. The Council will learn from and integrate as far as possible with other major
investment schemes such as Building Schools for the Future and LIFT building
strategic and operational relationships with key support partners as appropriate.
______________________________________________________________
EXECUTIVE SUMMARY:
1
Following a successful PFI announcement in December 2006, the Council is now
required to proceed with the development of a full Outline Business Case (OBC) for
PFI, which must be submitted within 12 months from the announcement.
This report sets the context to the interim management arrangements for the housing
stock and focuses on a number of issues that need progressing within the early
stages of OBC development.
To develop a robust and financially viable OBC the Council will require a breadth of
specialist support as outlined within the detail of this report. In addition, the existing
governance structures have been reviewed to develop appropriate and inclusive
mechanisms for a wide range of stakeholders.
This report also addresses a number of key areas for inclusion within the Outlined
Business Case such as an appropriate risk management strategy and approach to
community consultation.
This report has been approved by Joint Lead Members for Housing and Customer &
Support Services, on 16th April 2007
______________________________________________________________
BACKGROUND DOCUMENTS:
Pendleton Area Action Plan Issues and Options Report
Creating a New Pendleton – PFI Expression of Interest Submission
______________________________________________________________
ASSESSMENT OF RISK: High
______________________________________________________________
SOURCE OF FUNDING:
Funding has been identified and set aside as part of the Housing Stock Options
implementation budget for the development and submission of the Outline Business
Case and the associated work.
Up to £102m of PFI credits are available from the Government to support the PFI
scheme, subject to the approval of the Outline Business Case, which will be
submitted at the end of this calendar year.
Land and capital contributions are required from the Council in order to make the PFI
scheme financially viable, full details of which will be the subject of a separate report.
______________________________________________________________
LEGAL IMPLICATIONS: Provided by Pauline Lewis 19th Feb 2007
There are significant implications throughout this process, however advice is being
provided by our existing legal partners Cobbetts Solicitors. As a matter of good
practice, a procurement process will be undertaken to ensure specialised legal
support is provided throughout the entire PFI process. Part of the work that will arise
from the PFI process may (where it is Council authorised work) be allocated to Urban
Vision under the Exclusivity Clause.
2
______________________________________________________________
FINANCIAL IMPLICATIONS: Provided by Nigel Dickens
Comments are made within the report that demonstrates provision has been made
within the Stock Options budget to fund the operational implications of the decisions
being taken on the process for Outline Business Case.
The strategic implications and commitments required will be the subject of a separate
report in order to avoid confusion with operational decisions.
COMMUNICATION IMPLICATIONS:
Consultation on the Private Finance Initiative and the Pendleton Area Action Plan
has been ongoing for approximately the last 2 years. The team is now approaching
the stage where we will be able to go out to the community with a range of preferred
options for the redevelopment of Pendleton over the next 15-20 yrs. Subject to
Cabinet approval of the Preferred Options report, consultation will commence in
summer for a 6 week period. The outcome of this process will inform the
development of the Outline Business Case for PFI.
CLIENT IMPLICATIONS:
Salford City Council – The Pendleton PFI project is a HRA PFI scheme. It is
imperative that robust governance arrangements are in place as the Council is the
accountable body and will lead, manage and monitor the scheme with all decisionmaking via the Council’s Cabinet.
From June 2007, Salix Homes will be responsible for the traditional housing
management functions and the delivery of any renewal (housing) functions of the PFI
contract until the new company (PFI) forms and goes live (anticipated winter
2009/10). All Decent Homes investment and regeneration activity, associated with
the PFI proposal, will be delivered through the PFI consortium.
Whilst under the management of Salix Homes the detail of delivery will be outlined
within the Management Agreement. Following transfer of the Pendleton stock to a
PFI consortium, delivery details will be outlined through a Project Agreement and
Output Specification.
Council Tenants – communication process explained above
VALUE FOR MONEY IMPLICATIONS:
In line with treasury guidelines, the PFI procurement route has been considered in
terms of viability, desirability and deliverability. This form of quantitative assessment
allows comparison between the relative costs of undertaking a PFI versus a
traditional procurement. This has demonstrated that the PFI proposal represents
value for money.
3
Further value for money analysis will be undertaken as part of the development of the
Outline Business Case, and it will be necessary to demonstrate this through both
quantitative and qualitative assessments at the time of submission.
______________________________________________________________
PROPERTY:
The expression of interest for PFI funding incorporates a comprehensive package of
refurbishment and remodelling to the existing stock, together with some new
affordable housing provision. The potential future housing options for areas of
reprovision will be determined as part of the continuing development of the Pendleton
Area Action Plan through ongoing periods of consultation with the local community
during the year.
______________________________________________________________
HUMAN RESOURCES:
A project team for Pendleton is already in place to take this forward. Existing support
from external advisors has been reviewed, and there is a need to appoint additional
support to deliver certain aspects of the Outline Business Case. Details of consultant
support are detailed in the report.
______________________________________________________________
CONTACT OFFICER:
Jane Barlow – Pendleton Project Manager
Tel: 0161 793 8781
______________________________________________________________
WARD(S) TO WHICH REPORT RELATE(S): Langworthy
______________________________________________________________
KEY COUNCIL POLICIES: Housing, Planning & Regeneration
______________________________________________________________
DETAILS:
1.0 BACKGROUND
The Council submitted an Expression of Interest for Housing Revenue Account
(HRA) Private Finance Initiative (PFI) credits to improve and remodel stock within the
Pendleton area, and to build new homes in March 2006. Communities and Local
Government (CLG) have undertaken a thorough appraisal of the submission, and
carried out an assessment visit in June 2006.
An announcement was made on 21st December 2006 that the Council had been
successful in its submission, and that Pendleton would share in up to £200m of PFI
credits with North Tyneside.
The Council has also been progressing with the development of the Pendleton Area
Action Plan for the wider Pendleton area, as it was felt that the PFI proposal should
not be taken forward in isolation, but instead should form part of a co-ordinated and
holistic regeneration plan for the whole area. A separate briefing paper was
4
submitted to Joint Lead Members for Housing and Planning on the Area Action Plan
Progress and Issues on 18th December 2006.
Salix Homes, our new ALMO, will be responsible for undertaking the traditional
housing management functions in respect of the properties in Pendleton until the PFI
contract goes live, anticipated winter 2009/10. Once the Special Purpose Vehicle
(SPV) has been established for the Private Finance Initiative, the role of the project
team for Pendleton will split into two distinct areas; delivery of the Pendleton Area
Action Plan and PFI contract management
2.0 TIMESCALES & KEY MILESTONES
A detailed project plan has been developed setting out the actions required to
develop and submit the Outline Business Case (OBC). CLG have stated that the
OBC must be submitted by the end of 2007, and further discussions on the process
for government approval means that it is necessary for a draft submission to be
made in November, pending Cabinet approval of the submission in December. A
copy of the project plan is attached as Appendix A.
An indicative project plan covering the actions required following submission of the
OBC to procure the PFI contractor and sign the contract is also attached as Appendix
B.
Housing & Planning officers are also working closely together to ensure that the
development of the PFI scheme and the Pendleton Area Action Plan continue to be
aligned. The latest version of the key milestones in the preparation of the Area
Action Plan is attached as Appendix C.
3.0 CONSULTATION
The Pendleton team are working closely with colleagues to develop a Preferred
Options report for the Pendleton area. The regeneration options contained within the
report have been developed using feedback obtained during previous consultation
events, analysis of the housing needs questionnaire, stock condition survey and
general housing management information. Subject to Cabinet approval, the
preferred options will be consulted upon for a six week period, during summer.
A range of innovative consultation techniques are planned for June/July including;
door knocking, use of a 3D model, ‘who wants to be a millionaire’ style voting pads,
community ambassadors etc. In addition to this a leaseholder conference is planned
during the summer. All of the above will be delivered by Salix Homes.
Following the consultation period further work will commence to analyse the
feedback and financially model the various regeneration options, to produce a final
option to be included in the Outline Business Case for PFI. This piece of work will be
supported by the technical and financial advisors, and will be subject to further
consultation during Oct/Nov 2007. It is envisaged that this phase of consultation will
be housing specific, addressing local issues of re-housing and reprovison. The
Community Charter will be publicised during this phase of consultation, to clearly
outline the Council’s guarantees to residents who may need to be re-housed as a
result of select clearance.
5
4.0 CONSULTANT SUPPORT
The Council has a number of specialist advisors providing consultancy support to the
project. There is a requirement to re-procure some of this support due to the length
of time that the consultants were originally procured for, and also to procure
additional support for certain tasks required to develop the OBC. These are outlined
in more detail in the following sections.
4.1 Technical advisor support
A report was submitted to Lead Member for Housing on 21st September 2006 for
approval to procure Technical Advisor support, and this process has now
commenced. It is anticipated that the Technical Advisor will be procured and in place
by the end of June 2007.
4.2 Financial advisor support
The Council procured a package of financial advisor support for the stock options
process in 2005, and Ernst and Young LLP were selected to provide support to
implement each of the options following a competitive tendering process through
OJEU.
The tender documentation and Ernst and Young’s submission were based on the
work required for each stage of the PFI project through to the procurement of the PFI
contractor. The tender documentation also stated that the appointment would be
based initially on a two-year contract period with a possible extension at the
discretion of the Council. Delays in a PFI announcement from the CLG has resulted
in the Council being unable to deliver their commission as originally intended.
It is felt that Ernst and Young have performed well, and have provided sound advice
to the Council on what is a complex HRA PFI scheme. They provide this advice as
part of the overarching delivery of the stock options implementation strategy, and
have a detailed working knowledge of the interaction between each of the investment
options and their subsequent on the HRA.
Ernst and Young have also been critical to the development of an affordable PFI
scheme, and there is a risk associated with re-procuring the contract that another
consultant may not bring the same degree of innovation to the scheme, leading to
affordability issues for the Council in the future. If an alternative consultant were to
come to the project at this late stage this may also invalidate the warranty that the
Council has with Ernst and Young for the scheme.
It should also be noted that the lengthy period required for the contract to be reprocured would require the new contract to start at the most critical period in the
development of the OBC, and is likely to put the date of submission of the OBC at
risk of slipping, thereby leading to further affordability risks to the scheme delivery.
It is recommended that the contract with Ernst and Young in respect of the PFI
scheme be extended for the duration of the procurement of the PFI contractor until
the date of financial close and the PFI contract going live. Delivery the key outputs of
the project and will be monitored closely by the Client and reported to the Project
Board.
4.3 Legal advisor support
Throughout the development of the Expression of Interest for PFI funding Cobbetts
have provided legal support and advice, through a partnership agreement with the
Council. In relation to PFI, it has been recommend by Government and the 4ps that
6
the use of specialist support needs to present value for money (VfM), agreeing fixed
fees where appropriate.
Opportunities are currently being assessed to utilise and procure legal support
through existing arrangements in place corporately, namely through BSF. However, if
this has impact on CLGs confidence in the ability of the Council to deliver the scheme
then a view will be taken to continue to source this competitively.
The legal advisors will work in conjunction with the Council’s Legal support. This
support will be required during Outline Business Case development, through to the
date of financial close and the PFI contract going live.
A project brief has been developed, utilising the experience of Salford’s internal legal
team and the 4ps standardised legal advisors brief that has been tried and tested.
If required the contract will be procured via OJEU or the OGC catalyst where the
Council would invite a select list of firms to submit formal tenders. The maximum
contract value is anticipated to be £250k.
Until the procurement process is concluded we will continue to engage with Cobbetts
to provide any necessary legal advice in relation to leaseholder contributions and
land assets.
4.4 Independent tenant advisor support
TPAS have provided independent tenant advice throughout the Stock Options
process and development of bid submissions for all investment options. The Council
is currently in the process of re-procuring this contract under a framework agreement,
as approved by Lead Member for Housing in December 2006.
The re-procured contract will ensure that independent tenant advisor support is
available to support the PAAP process and the PFI project through Outline Business
Case development until financial close and the PFI contract going live. The new
contract is anticipated to commence during the summer of this year.
4.5 Insurance advisor support
Key tasks undertaken by insurance advisors includes; the identification of risk and
insurance issues, the development of a project insurance plan, a review of bidders
outline insurance proposals to determine the Required Insurance policy structures,
the evaluation of insurance responses against tender requirements and the costing of
the Required Insurances.
We have corporate experience of this through LIFT & BSF and we are currently
assessing if this can be utilised and commissioned through existing arrangements.
However, if this has impact on the confidence to deliver (CLG and the Pendleton
team) then a view will be taken to source this competitively.
If it is necessary to procure these services externally it is estimated that the contract
value will be less than £100,000, from Outline Business Case through to contract
award.
4.6 Design Champion / Architects
Communities and Local Government (CLG) advised that given the regeneration
focus of the PFI scheme, it would be necessary to identify and procure a design
champion to support the scheme as it progresses. The role would be to support the
development of the Outline Business Case, statutory planning application and to
7
assist in the evaluation of bid submissions in terms of design quality and excellence.
Design issues also need to feature strongly in the development of the Output
Specification and Developer Agreement for the new build element of the PFI
contract.
The Council in partnership with Urban Vision and CABE is preparing a Design
Supplementary Planning Document (SPD). Clearly any champion would work within
this framework. There is potential for the procurement of the champion to include the
advisors who have assisted in the development of the SPD.
CABE at the request of CLG has also provided advice and guidance to HMR
Pathfinders and the Pendleton PFI scheme.
It is estimated that the contract value will be in the region of £50,000 – £100,000 from
Outline Business Case through to contract award.
4.7 Stock condition and Specialist surveys
Lead Member for Housing approved the advertisement of the Stock Condition Survey
contract on the 2nd June 2005. Urban Vision and Capita Symonds expressed an
interest in undertaking this contract through the Council’s exclusivity arrangements
with Urban Vision.
It was agreed for the work to be undertaken in two phases, the first focusing on the
completion of a 60% survey to support the submission of the expression of interest
for PFI funding, and the second to complete the remaining 40% of surveys, subject to
a successful announcement from Government.
A 100% stock survey was
recommended by Government. Failure to invest in obtaining this information at the
outset may result in poor cost analysis from bidders, unforeseen costs being
identified at a later date and/or a lack of confidence from potential investors. It is
therefore recommended that we proceed with the completion of the remaining 40%
stock surveys and specialist surveys as outlined below, subject to agreeing fees with
Urban Vision and Capita Symonds.













Decent Homes assessment (inc. HHSRS) to be included within remaining 40%
surveys
Deleterious Materials survey - asbestos surveys complete, any further surveys to
be recommended by Capita Symonds
CCTV drainage surveys
Mechanical & Electrical surveys (inc. incoming mains water/gas/electrical) –
surveys have been completed based on 9 archetypes. Further consideration
need to be given to the potential need to extend surveys to cover cloned blocks
Acoustic testing – further discussion needed with Capita Symonds to determine
level of surveys to be completed
DDA Access Audit - estate wide assessment
Schedule of tenants adaptations/alterations – further discussion is required with
Urban Vision to determine if this data was collected through stock condition work
Desktop review of an Environmental & Contaminated Land Survey completed by
SCC May 2005
Desktop geo-technical survey
Topographical survey - further discussion required with Urban Vision / Capita
Symonds to determine the requirement for these surveys
Desktop review of overcladding options to high-rise blocks (based on
BRE/Curtins reports)
Legionella surveys
Fire safety surveys
8





Biological Infestation surveys – the need for completion of these surveys will be
assessed during the 40% stock condition survey work
Cavity Wall Tie and Insulation surveys
Structural investigations - the need for completion of these surveys will be
assessed during the 40% stock condition survey work
Asbestos surveys – further discussion required to determine removal costs and
the need to extend the survey sample
Survey of lift installations - surveys have been completed based on 9 archetypes.
Further consideration need to be given to the potential need to extend surveys to
cover cloned blocks
Following the completion of the desk top review of overcladding options to high-rise
blocks based on the BRE/Curtins reports, the Council will need to take a view if full
structural surveys are required. This is currently not part of Urban Vision’s brief, but
the issue has arisen following a 4ps network meeting with all local authorities working
on housing PFI’s. Government have requested full structural surveys from one local
authority as a condition of the Outline Business Case being approved, to remove any
risk. It should be noted that if structural surveys are done at this stage, there have
been warranty issues on other schemes which may result in the PFI bidders
requesting another survey further down the line.
4.8 Plus Property Solutions
Plus Property Solutions has provided support throughout the stock options process.
In terms of PFI support this included advising on the brief for the stock condition
survey and analysis of the data and the production of an Investment Modelling
Toolkit to feed into Government’s HRA PFI model. To ensure continuity it is
recommended that Plus Property Solutions continues to support the PFI team
through to the completion of the 100% survey, and provide an updated Investment
Modelling Toolkit to feed into the required models for Outline Business Case
submission. As a technical advisor for PFI will be appointed in June 07, Plus
Property Solutions will also be required to fully brief the appointed advisor and make
arrangements for the handover of technical data.
4.9 Title Investigation
Urban Vision has been approach by the Council to contribute to a ‘Title’ report that is
required for the PFI bidders. The documents will enable the Council to decide how it
wishes to deal with any matters resulting from the title investigation and associated
due diligence. A wide range of surveys/investigations will be included within this
piece of work for example: tree surveys, bat surveys, listed buildings, freehold titles,
title check. Lead Member approval is sought to commission this piece of work.
4.10 Financial Implications of Consultant Support
Each Month the Lead Member for Housing receives a monitoring report on the
position for costs being incurred through the Stock Options Implementation process.
These costs are funded through the HRA and this will give the re-assurance to the
Lead Members that the implications of the decisions taken in the above paragraphs
for consultants have already been identified and accounted for.
5.0 PFI CREDIT LEVEL
When the Expression of Interest was submitted in March 2006, the Council
requested PFI credits of £109.5m. This figure was based on the outcome of detailed
financial modelling using government models, to determine the size of credit that the
scheme would require. During their assessment, CLG asked the Council to make a
9
number of amendments to the information in the model.
resulted in a revised credit requirement of £102m at that time.
These amendments
The credit requirement of £102m was based on an assumption that an
announcement would be made over the summer on the successful schemes, and a
number of key milestones in the project flowed from this assumption to inform the
anticipated date of financial close of the project. The financial close date, which is
effectively the date on which the PFI contract is signed, is critical to the level of
credits required, due to the way in which the model calculates the credit level. The
delay in the announcement means that it will be necessary to update the model as
the Outline Business Case is prepared in order to test the deliverability of the scheme
within the timescales originally anticipated, and to determine the impact on the level
of credits that is available.
CLG have formally advised the Council that it should work on the basis that £102m is
the maximum level of credits for the scheme. However, they have also advised that
they may be able to allow a limited increase in exceptional circumstances but that
due to restrictions on resources it must not be assumed that they can agree to this.
An exceptional circumstance that may be taken into consideration is any cost
implications resulting from the delay in a PFI announcement. This issue has been
discussed with the PFI Team at CLG, and they have agreed that they will have a
dialogue with the Council on this issue over the summer as the preferred option is
developed and the model refined due to the delay in the announcement and the
consequent knock-on impact on critical milestones. In agreeing to this, they have
again stressed that this does not imply that any request for additional credits will be
approved as they cannot guarantee that they will have additional resources available.
The implications of these will be reported as details become clearer through further
work during the forthcoming months.
6.0 COUNCIL CONTRIBUTIONS
The Council as part of the Outline Business Case submission will be required to
demonstrate its' financial commitment to the project through resources required as
support, which could be land or costs or a combination of the two.
The contributions required for the PFI scheme can not be viewed in isolation to the
other strands of the investment strategy, for example support to the HRA or Right to
Buy sharing agreements with the LHC. This will be the subject of a further separate
report.
7.0 SUGGESTED PROJECT GOVERNANCE ARRANGEMENTS
7.1 PFI Project Board Proposal
The Pendleton Housing PFI scheme is a Council led initiative and as such the
Council will act as the accountable body and retain all powers of decision-making via
its Cabinet.
This will allow the Council to review all decision-making in the widest context and
against other major investment schemes running in the City. The Chief Executive will
ensure that the Cabinet is supported by programme board arrangements which will
either be through the Council’s Corporate Management Team or through the
Council’s newly emerging major Corporate Management arrangements. Key areas of
decision-making and review will include:
10






Ratifying decisions taken by the project team
Supporting the project in the wider strategic context
Signing-off key stages e.g. final recommendation of OBC, approval of tender
documentation, selection of shortlist of bidders/preferred bidder, approval of
final business plan
Risk management
Management of political dimensions
Recognition and accommodation of matters for member approval
Issues and decisions may be delegated to the Lead Member for Housing from
Cabinet or jointly to the Lead Member for Housing / other Lead Members as
appropriate.
Establishing strategic governance in this way creates a mechanism by which the
Council can engage effectively in the development in the PFI project and have a
clearly defined strategic role.
7.2 PFI Project Team
A project team for PFI has been active for the last 2 years and group membership
has naturally evolved over time. Since receiving a successful funding announcement
the group composition has been reviewed to ensure that the necessary skills and
expertise will be available to support and steer the development of a robust PFI
proposal. It is recommended that the project team consists of the following members
and that the group is chaired by a Senior Manager from the Council:











Head of Service / Assistant Director Housing and Planning – to be filled through
reorganisation / recruitment (Chair)
Head of Housing Market Renewal (Salix)
SCC Housing and Planning Group Accountant
Pendleton Manager
Principal Officer PFI
Financial Advisors – Ernst & Young
Legal Advisors – SCC Legal Services
Technical Advisors – through OJEU procurement
Urban Vision
Neighbourhood Management
Central Salford URC
The Project Team (via the Chair) will report to the Council’s Cabinet on a bi-monthly
basis and more regularly should specific decisions require approval.
It is envisaged that the PFI Project Team will meet bi-monthly for formal meetings. In
between, informal workshops will be established to complete specific tasks, for which
the appropriate team members will be brought together. To ensure that the overall
project team is kept up to date on progress, monthly electronic briefings will be
circulated.
7.3 Stakeholder Governance Arrangements
Under current governance arrangements the following groups are in place:
 Pendleton Steering Group was established in November 2004, consisting of
the main stakeholders in the area e.g. the Council, Salford University, four
Community Forum representatives and GMP. Its purpose is to direct and
guide the master plan process and to ensure that the PFI proposals are
aligned with it
11


Pendleton Community Forum was established in January 2005, open to all
who live or have an interest in the area. The Forum is an opportunity for the
local community to receive updates on the master planning process, get
involved in consultation and ask questions. Community representatives
report consensus of opinion to the Pendleton Steering Group.
Pendleton PFI Group was most recently established in November 2005,
consisting of four tenant representatives, one leaseholder representative,
three ward councillors, one Salford City Council and one New Prospect
representative and an Independent Tenant Advisor. The main purpose of this
group is to allow interested parties to discuss specific issues relating to PFI
and the content of the tender documentation, and to agree appropriate
actions.
The following recommended changes to the existing governance arrangements have
been discussed with local elected members during monthly briefing sessions.
It is recommended that the role of the Pendleton PFI group changes, in light of the
PFI Project Board being established. The group has recently been through an
intense six month training programme, focusing on various aspects of the PFI
process. During this period it was felt that a workshop based approach was more
effective in engaging the local community, problem solving and working through
options. It is therefore recommended that this group is re-aligned and the ward
councillors and community representatives (including the wider community
ambassadors) have the opportunity to join the PFI Project Board via a selection
process. As this would not enable all existing community representatives to join the
Project Board, it is recommended that they continue in their role of community
ambassadors, assisting with the facilitation of workshop sessions with the wider
community.
It is envisaged that the community ambassadors will have a
fundamental role in engaging with hard to reach groups and ensuring that consistent
messages are being portrayed. Initial workshop ideas focus on; the development of
the output specification, creating mixed income communities, sustainable housing,
safer by design, choice based letting, local lettings policies and competitive dialogue.
Once the procurement process for PFI has commenced opportunities will become
available to actively participate in bid evaluation in a number of areas; design,
housing management, legal, finance and technical.
In establishing Salix Homes, the Council in its bid to Communities and Local
Government recognised the need to develop neighbourhood panels across Central
Salford. The aim of these panels is to maximise customer and community
involvement and participation, in the initial work of Salix Homes (until the new PFI
company forms). It is proposed to review the current role of the Community Forum to
ensure the community involvement activities delivered by Salix and the needs of the
Council’s wider neighbourhood management structures are considered as
appropriate. Any proposed revised arrangements will be consulted on with tenants
and residents associations, the wider community and local elected members.
Individual workshops will be arranged and well publicised to discuss time-limited
tasks associated with PFI such as those mentioned above, and PAAP consultation
on the preferred options report and draft area action plan.
The role of the Pendleton Steering Group has been important in discussing the wider
regeneration of the Pendleton area with a range of key stakeholders. However, over
recent months attendance has been slowly diminishing. We are currently trialling
new ways of engaging with the group through electronic meetings and monthly
updates. It is our intention to only hold physical meetings when there are options or
12
issues that need discussing through a workshop based session, which in the past
has received better attendance rates. It is recommended that the team continues
trialling new ways of working with the group to increase participate from the key
stakeholders.
8.0 RISK MANAGEMENT PLAN
The Pendleton team has developed a risk management plan following a series of
meetings and a risk workshop. Cobbetts and Ernst and Young took part in the
workshop and it is felt that this has captured the most significant risks associated with
the scheme.
The plan is attached as Appendix D, and this will be regularly monitored and
reviewed by the Project Team. Any significant issues will be reported to the Project
Board.
An additional workshop has been arranged by Ernst & Young to look at an early
indication of project risk and how they can be overcome under statutory processes,
and accounting treatment risks.
9.0 EARLY NEW BUILD IN ADVANCE OF PFI CONTRACT
Targeted clearance and new build will form part of the scope of the PFI contract.
However, it is recognised that some early reprovision will be required in the
Pendleton area pre 2009/10, to reduce pressures on a reducing housing supply.
The Pendleton team are currently working with Great Places, the lead RSL for the
Pendleton area, to develop some initial proposals for potential reprovision on a
number of sites. This is likely to form part of the Affordable Housing Programme
2008-2010 submission, this year. These sites include the former Windsor High
School Site, former Lilac Court site, former Wrotham Close site and the land North of
Lidl.
At this stage the proposals are still in the early stages of development.
10.0 RECOMMENDATIONS
That Cabinet notes and approves the suggested recommendations outlined within
the ‘recommendations’ section of this report
13