Issue - decisions

Matter for Decision

The report presented the review of the pilot phase of the Cambridge City Housing Company Limited (CCHC) and considered whether the pilot phase should continue, the company should be moved into business as usual, or if it should be closed.

Decision of Executive Councillor for Strategy and External Partnerships

i.        Approved that CCHC moved from its pilot phase into business as usual.

ii.       Confirmed the Council’s financial support for the company, subject to ongoing review by the S151 officer.

iii.      Agreed that the Council refinanced the existing loan to the company for three years at 2.02%.

iv.      Supported the company directors’ recommendation that, in view of the possible market impact of Brexit, any decision on further investment was delayed until at least the final quarter of 2019/20, or until the local property market had stabilised.

v.       Agreed that a third director be appointed to the company

Reason for the Decision

As set out in the Officer’s report.

Any Alternative Options Considered and Rejected

Not applicable.

Scrutiny Considerations

The Committee received a report from the Head of Finance.

The Head of Finance said the following in response to Members’ questions:

       i.          It was proposed to keep the loan rate to the CCHC despite the Bank of England confirming that it would retain current interest rates and they would not be increasing their interest rate. The loan rate would provide additional interest to the council but it would not be a significant amount.

     ii.          The CCHC was not advised to buy any additional properties at the moment given the economic uncertainty with Brexit. If properties were bought and there was a downturn in the housing market this could bring the company to a negative equity position.

   iii.          The Cromwell Road development had other objectives and priorities.

Councillor Herbert confirmed that there was a commitment to continue the CCHC.  The company had an obligation to operate without losing money. A range of options was contained within the confidential appendix and based on current overheads the company could continue to operate.  There were significant development options due to come forward in the next couple of years.

The Committee resolved:

-        unanimously to endorse recommendation 2.1

-        unanimously to endorse recommendation 2.2

-        by 4 votes to 0 to endorse recommendation 2.3

-        by 4 votes to 0 to endorse recommendation 2.4

-        unanimously to endorse recommendation 2.5

The Executive Councillor approved the recommendations.

Conflicts of Interest Declared by the Executive Councillor (and any Dispensations Granted)

No conflicts of interest were declared by the Executive Councillor.