Ilex Urban Regeneration Company
Ilex Urban Regeneration Company
Minutes of Special Board Meeting
6th November 2015, Creative Hub, Ebrington
Present:
Philip Flynn (PF) – Chair
Mel Higgins (MH)
Aaron McElhinney (AMcE)
Colm McKenna (CMcK)
Geraldine Keegan (GK)
Deirdre Heenan (DH) Part
In attendance:
Gavin Harkin (GH) Part
Henry Johnston (HJ) Part
Siobhan Broderick (SB) Part
Minute taker:
Mo Durkan (MD)
Item No.
1.
2.
Topic
Apologies: John Kelpie, Henry McGarvey, Gerry
Mullen. On behalf of Board, the Chairman extended his
best wishes to Gerry Mullen’s father who was
undergoing surgery.
Conflicts of interest: None.
3.
Minutes of meetings: September 24th.
The minutes were formally approved.
4.
Representation by Gavin Harkin:
Representing the Ilex staff, Gavin Harkin (GH) outlined
the team’s concerns about the closure of Ilex,
announced October 29th. He asked Board members to
remain in place to best serve the interests of staff.
Action
The Board unanimously confirmed that they will remain
in place to safeguard staff and ensure the best
possible redundancy arrangements are made to
reward the team for their dedication. Board members
were keen to acknowledge staff’s significant
achievements to date and asked GH to convey their
appreciation to the entire team.
On behalf of staff, GH also requested that the Board
nominate an individual to liaise with staff and with
whom issues could be raised after the departure of
MH. He explained that a more regular Board presence
in the Ilex offices would be hugely appreciated by staff.
AMcE volunteered to fulfil the role of liaison and his
offer was agreed by all.
AMcE
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Ilex Urban Regeneration Company
The Chair said that the Board has key priorities:
-
-
-
To protect and support staff,
To protect the Board and the company for the
next five months by fully discharging our
governance responsibilities,
To ensure that the momentum we have
successfully achieved this year in the
development of Ebrington is maintained over the
transition
To ensure that the legacy of what Ilex has
achieved is properly recognised
CMcK expressed dismay at the press release issued
by OFMDFM and reaffirmed the Board’s total
commitment to staff.
GK fully endorsed CMcK’s remarks and said the Board
has the greatest admiration for the work of staff. The
Board, she said, will stay together. Legacy is key.
GH explained that the release of the RSM McClure
Watters report with the OFMDFM press release was
particularly distressing for staff and will make it even
more difficult for staff to find new jobs.
CMcK said staff should not be ashamed of their
association with the company and said few people
actually believe the review or recognise Ilex as the
subject of it. Again, he asked GH to convey the Board’s
100% support to staff. As Chair of the Audit
Committee, CMcK also pledged its full support.
MH advised Board that he will provide references to all
staff and give a very accurate account of people’s
work.
The Chair thanked GH for relaying the views of staff.
MH indicated that all staff had acted extremely
professionally when they had a meeting with OFMDFM
the previous day. MH also noted that GH had outlined
staff views in an objective manner.
GH left the meeting.
5.
DH joined the meeting.
Update from Chairman:
PF advised the Board that a meeting was held the
previous day between JK and OFMDFM. A Transition
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Ilex Urban Regeneration Company
Team to oversee move to DCSDC will be set up and
will include an Ilex Board member.
OFMDFM is proposing to appoint a part time Interim
Chief Executive from its existing Ebrington team.
MH said that he had asked OFMDFM for their
proposed arrangements for Ilex to be confirmed in
writing but at this point their preference was to present
verbally to Board for discussion.
PF said that Board will ask for everything in writing
before they can agree to anything.
CMcK raised the issue of Acting Chief Executive,
stressing the need for a candidate with the necessary
skills, someone who has credibility in the city and also
in NICS. He also expressed concern that activity
should continue at Ebrington. The transition period will
transcend the lifetime of the Board.
DH asked if there was any assurance that monies will
be ring fenced for the remainder of the financial year.
CMcK feared the potential loss of the Grade A office
accommodation project.
DH queried the extent of the Board’s power in the
appointment of an Interim Chief Executive. MH
explained that the Memorandum and Articles of
Association state that the P & R Committee can make
recommendations to Board. If the Board accepts
recommendations, it then puts them to OFMDFM.
CMcK pointed out that the Interim Chief Executive
must be independent. He/she is a Board member and
his/her first duty is to the Board. Where, he asked, do
the loyalties of a part time Interim Chief Executive lie?
DH was of the opinion that the proposed Interim Chief
Executive will have a conflict of interest. She said that
the Board needs to think of the staff and the city. It
needs to make its views clear.
MH said that OFMDFM has given assurances that staff
will be employed until March 31st. We stressed the
need to ensure the maximum benefit to staff.
DH reaffirmed the Board’s agreement about corporate
governance, ring fencing of funds, and transition
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Ilex Urban Regeneration Company
arrangements.
PF pointed out that the Board can propose an
alternative Interim Chief Executive. The appointment of
Chief Executive is still the responsibility of the Board.
MH advised that Ilex must have an Accounting Officer.
If Ilex did not have a Chief Executive, Mark Browne,
OFMDFM would be the Accounting Officer.
DH underlined the importance of the Board to look
after governance. The proposed Interim Chief
Executive would not be full time and may not be
deemed to be independent.
CMcK said Board needs evidence that OFMDFM’s
proposed Chief Executive has the necessary qualities.
From December 1st 2015 until March 31st 2016, he
cautioned, the Chief Executive can only be
accountable to the Ilex Board.
CMcK asked which person from SIB would be
responsible for dealing with investors. MH replied that
Martin Turner would do so.
PF and DH reiterated the need for the Chief Executive
to have the requisite skills and credibility. He/she must
be known in the city.
Concern was again voiced about the independence of
the proposed interim Chief Executive.
Henry Johnston (HJ) and Siobhan Broderick (SB),
OFMDFM joined the meeting.
HJ outlined OFMDFM's three objectives to:
-
Close Ilex in an orderly fashion in accordance
with the Ministers' decision,
Continue activity on site,
Advance new developments - Grade A office
accommodation and hotel.
The direction of travel is for Ebrington to transfer to
Derry City & Strabane District Council at the end of
March 2017.
OFMDFM's proposal is for Siobhan Broderick
(OFMDFM Director - responsible for sponsorship of
Ilex) to take up post as Interim Chief Executive and
Accounting Officer from December 1st to provide
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Ilex Urban Regeneration Company
continuity until April 1st 2016. She would also take
responsibility for new projects working on a part time
basis on the orderly close down of Ilex.
HJ said that Ministers will issue a Letter of Expectation
to Ilex outlining their requirements of the Board to
March 31st. Ilex will receive the letter prior to the Board
meeting on 26th November 2015. A detailed workflow
outlining OFMDFM tasks and Ilex tasks will also be
presented.
SB left the meeting.
HJ advised that it was not possible to go to market to
seek a Chief Executive for a four month period and that
with the proposed individual he would directly support
with his own regeneration background which is
extensive. He stressed that the Grade A office
accommodation and the hotel development were key
priorities for OFMDFM to take forward.
The Board stressed that both the skills and credibility
of the Interim Chief Executive were extremely
important. The fact that the individual proposed is an
official of OFMDFM is not necessarily in the best
interests of the city. The Board raised concerns about
OFMDFM's proposed Interim Chief Executive in terms
of conflict of interest, local knowledge and familiarity
with key players. The Board reiterated alternatives
already proposed to OFMDFM and was advised that
while OFMDFM had considered the options, for other
unrelated reasons, they were not possible.
Significant discussion ensued about OFMDFM's ability
to deal with investor confidence and continuity for the
17 months until transfer to the Council and the
important issue of credibility with investors and with
stakeholders in the city.
DH left the meeting.
HJ advised that meetings had been conducted earlier
with DCSDC and that direct engagement with DCSDC
would commence immediately and would continue
throughout the transition period. OFMDFM would
establish a Programme Board for the project which
would be chaired by HJ and which the Ilex Chair would
be invited to join. DCSDC and DSD would also sit on
this team.
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Ilex Urban Regeneration Company
Board sought clarification from OFMDFM if the
proposal, as presented, was a fait accompli and
cautioned that clear lines of accountability and
responsibility to the Ilex Board were a pre-requisite. As
non-executive directors, the Board must discharge its
duties in accordance with company law. The Chief
Executive is the only executive director on the Board
and, as such, the officeholder's primary duty is to
represent the interests of Ilex.
The Board sought further clarification on potential
conflict of interest and sought to consider alternative
options. OFMDFM advised that while the Interim CEO
was in place and working for Ilex her primary
responsibility would be to Ilex and accountability to the
Ilex Board. In the time frame available, OFMDFM
consider this to be the only option.
Following further deliberation, the Board agreed that
this was the only option available to deliver the Board's
initial objectives and, more importantly, allow the Board
to serve the best interest of the staff.
CMcK impressed upon HJ the Board’s disappointment
with the OFMDFM review of Ilex and, in light of that,
the importance of OFMDFM positively promoting the
achievements and legacy of the company which has
achieved so much, particularly in the last six years.
HJ confirmed that he would undertake to ensure
OFMDFM positively promotes the achievements and
legacy of Ilex.
SB rejoined the meeting.
MH said that money will be required for the wind down
of Ilex. There is a deficit of ca. £700,000 in the pension
reserve and anticipated redundancy payments, so a
bid will be made to OFMDFM.
He explained that NILGOSC is working on the actuarial
position in time for the November 25th Board meeting.
HJ assured Board that the money will be found.
SB stated that the NICS policy allows for one month for
every year of service up to a maximum of 23 months.
SB advised that a meeting with DSD was scheduled
the following week to discuss the bridge which is
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Ilex Urban Regeneration Company
expected to transfer to DRD.
MH queried whether OFMDFM’s Finance team will do
the accounts in the new year. SB replied that they may
need to set up a Legacy Board.
MH said it was likely that a Board member would be
required to sign the accounts in June 2016. HJ replied
that a Board member will need to be retained to sign
the Ilex accounts in June/July 2016. He also said that
by the end of March 2016 OFMDFM will need
everything from Ilex on the consolidated accounts.
MH asked when the Board would receive the Letter of
Expectation from Ministers. HJ explained that a draft
would be sent to Ministers the following week. The
department hopes to have the letter with Board no later
than Friday, November 19th, in time for the next Board
meeting.
Action: OFMDFM to provide Ministerial Letter of
Expectation to Board no later than November 19th
OFMDFM
PF said that while the Programme Board will continue
beyond March, it will not require Board presence
beyond that date.
MH said Ilex will attempt to prepare as much
information in advance of the next Board meeting.
CMcK explained that while the next Audit Committee
meeting is scheduled for January 2016, it can be
convened before that date.
MH cautioned that there will be a need for committees
to meet more regularly in the lead up to the company
closure.
HJ concluded his remarks by reiterating the three
strands of work being prioritised by OFMDFM:
-
The close down of the company
The continuation of work streams
New projects – Grade A office accommodation
and hotel development.
HJ and SB left the meeting.
MD asked Board members to outline the arrangements
for staff to liaise with Board after December 1st. It was
agreed that AMcE will call to the office each week.
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Ilex Urban Regeneration Company
As Committee Chairs, CMcK and HMcG will also
update staff after Committee meetings.
6.
MH advised Board that, based on the Letter of
Expectation, the Chairman will need to agree targets
with the Interim Chief Executive.
AOB
MH said that the transfer of the One Plan function is
anticipated in December 2015 or January 2016.
Referring to the procedure for redundancy, MH said
that one month’s salary for every year of service is
proposed, based on the NI Civil Service Scheme. He
asked Board to apply their discretion in the event of
any employees finding a job in the interim whereby
they remain eligible for redundancy.
CMcK pointed out that no staff member will leave Ilex
before March 31st 2016 unless by choice.
Action: Board approved that staff who find
alternative employment and leave Ilex before
March 31st are still eligible for redundancy
payment.
MH asked Board to approve staff training in the
preparation of CVs, interview techniques, etc to equip
them for their job search.
Action: Board approved training to equip staff with
the necessary training to seek alternative
employment.
MH asked Board to approve the engagement of
independent HR advice to support the outgoing Chief
Executive and liaise with staff to safeguard their best
interests. As such an appointment may constitute a
Single Tender Action, it had already been discussed
with OFMDFM the previous day (November 5th) and
OFMDFM has agreed.
Action: Board approved the engagement of
independent HR advice to support the outgoing
Chief Executive and liaise with staff.
MH asked the Board if they were content to approve
CPD fees as outlined in the October 29th Board papers.
Board agreed.
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Ilex Urban Regeneration Company
Action: Board approved CPD fees.
MH asked Board if they were content to approve the
business case for Building 10, submitted at the Board
meeting of October 29th.
Action: Board approved the business case for
Building 10.
MH outlined the scenarios in relation to capital spend
in 2015/16. He reminded the Board that if business
case approval is not in place, capital monies will need
to be surrendered at the last monitoring round.
Action: Board approved OFMDFM proposal to
appoint Siobhan Broderick as Interim CEO from
December 1st 2015 to March 31st 2016.
CMcK said that the Board expects the Interim Chief
Executive to discharge her duties as the outgoing Chief
Executive does.
Notwithstanding Board’s concerns about an OFMDFM
appointee to the role of Interim Chief Executive – and
without sight of the Letter of Expectation – the Board
agreed that this was the only real option available to
deliver the Board's initial objectives and, more
importantly, allow the Board to serve the best interest
of the staff.
Board approved the OFMDFM proposal.
7.
Date of next Board meeting: November 26th 2015.
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