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Agenda item

Commercialisation Group Terms of Reference and Work Programme

Purpose: To provide an opportunity to suggest items for the Commercialisation Group's forthcoming work programme following an update of the terms of reference.

Minutes:

The Commission considered a report (Agenda Item 6) which responded to their request for information in respect of the progress made by the Commercialisation Group, its work programme and future direction.

Andy Sharp introduced the report which provided an assessment of the current position in respect of the work undertaken by the Commercialisation Group; an overview of the work programme for the Commercialisation Group for the period August 2018 through to May 2019 and information in respect of the future leadership, focus and direction of the Commercial Board (revised name of the group) from November 2019 onwards following consideration by Corporate Board and a light touch review of the group.

Councillor Alan Law asked for the membership of the group and its initial goals. Andy Sharp advised that previously it was chaired by Paul Anstey, Head of Public Protection and Culture, and was attended by Sarah Clarke, Head of Legal Services, and June Graves, Head of Commissioning. Attendance from other services was variable. The Group’s initial goals had been to grow some income generation initiatives within the Council through the Lion’s Lair programme and delivering training to begin to instil a culture of commercialisation. Nick Carter advised that some members of the Executive had also been on the group.

Councillor James Cole queried whether any efforts had been made to establish expertise among Councillors; Andy Sharp advised that it had not but he took on board the suggestion.

Councillor Lee Dillon asked how the Council’s traded services were reviewed and benchmarked against other authorities. Andy Sharp advised that the income generated vs the cost of delivery would be assessed in the New Year. It was difficult to benchmark because data collection was not uniform. Closer links to the Council’s Finance Team would be made to enable better understanding of existing commercial and traded arrangements across the organisation as over £7.5M of income from 54 different trading activities had been identified.

In response to a request to report back to Members, Andy Sharp confirmed he could return to present to the Commission. Nick Carter highlighted that a recent review of the Council’s governance included the Commercial Board and could clarify any queries on reporting lines.

Councillor James Cole highlighted the issue of resourcing and commented that it was futile pursuing commercial projects with no Marketing Officer. Nick Carter confirmed that the Council did have a Marketing Officer and noted that the Board had access to the Transformation Fund.

Councillor Law agreed that the dedicated resource was quite small when there were 11 potential projects. He noted that there was already a ‘red’ action included in appendix D relating to £100k of income generation and pressed the need to understand current activity. Andy Sharp offered reassurance that the refreshed terms of reference would enable the group to focus and ensure the value before embarking on projects.

Councillor Martha Vickers noted that other Councils had assets from which they could generate income and West Berkshire’s were limited. She questioned the appropriateness of trading some services such as the Emotional Health Academy (EHA). Andy Sharp advised that services such as the EHA has dual strands and while a universal service was offered to those eligible, some elements could be sold, for example to other authorities. Councillor Steve Masters expressed concern that this could lead to a system whereby individuals not entitled to access the EHA freely could pay and be prioritised. Andy Sharp advised that the Council had been careful in how it set the EHA up. Nick Carter added that the EHA’s largest customer was schools and the resource was scaled to meet the demand. He noted the pressure on schools’ budgets effecting buy back of many of the Council’s traded services so managers needed to be clear on what resource was servicing the traded element of their services. The Council did not give preference to those who could buy support from the EHA.

A discussion was held regarding the replicability of some of the Council’s traded services, therefore reducing demand from other local authorities.

Councillor Masters commented that it appeared to be a lot of effort for a modest return; Nick Carter advised that many of the activities related to core business and where an opportunity to trade had been identified.

Councillor Masters challenged certain activities such as the investment in the Routeguard app and questioned whether due diligence checks had been undertaken. The Council had spent £60k on app development over the last five years and Councillor Masters expressed the view that this was not the Council’s core business. He stated that Council officers already had high workloads and it was questionable to channel staff resource onto such projects which generated modest returns. Nick Carter advised that only a small number of staff, usually at senior levels, were working on the Council’s transformational activities including commercialisation. Regarding the app development point, Nick Carter stated he did not know all the detail and would make enquiries regarding the business case. A balance needed to be found between enabling staff to bring forward their ideas and a strong business case. The internal governance review would ensure that a more robust approach to commercial projects was taken in future.

Councillor Lee Dillon asked whether services which had statutory fees and charges such as planning were in the scope of the Commercial Group. Andy Sharp confirmed that those services’ fees and charges were on a cost recovery basis rather than income generation and so were not considered to be commercial activities.

Councillor Law observed that over the fifteen months since the creation of the group there was a lot of activity but only now was a structure put in place. He had expected to see more information regarding the revenue achieved. Andy Sharp responded that the tracking with Finance was not yet in place and he wanted to ensure that income was not double counted.

(Councillor Jeff Brooks joined the meeting at 7.20pm)

Councillor Law further highlighted that the Joint Venture with Sovereign and the Council’s Commercial Property Investment activity sat outside the group which seemed illogical. Nick Carter advised that those activities predated the creation of the Commercial Board and had their own governance structures including Member oversight.

Councillor Masters questioned the return achieved through property investment when it had been revealed at the recent meeting of the Executive that the return on investment for solar photovoltaic panels was 5%. He asked whether the Commercial Board would have the confidence to terminate projects which were not achieving the expected income in order to divert funding towards other projects. Nick Carter stated that the Executive were currently reviewing the Property Investment Strategy and highlighted that a project to establish a shared legal service with other authorities was terminated on the basis that the business case did not stand up. The Council had developed much more robust project management methodology which balanced the financial objectives with achieving better outcomes for residents.

In response to a query from Councillor Dillon, Nick Carter agreed to confirm whether Opposition Members could attend the Property Investment Board.

Councillor Law requested that Andy Sharp present an update report in twelve months time which listed what the Board had done, what revenue had been achieved and how this was tracked.

Resolved that:

(1)       The Commission noted the report.

(2)       The Review of Internal Governance report would be circulated to members of the Commission.

(3)       Nick Carter would make enquiries regarding the business case and approvals for the Routeguard app.

(4)       Nick Carter would confirm whether Opposition Members could attend the Property Investment Board.

(5)       An item would be added to the Commission’s Work Programme for Andy Sharp to provide an update on Commercial Board after twelve months.

Supporting documents: