Question 7: Procedure Rule 9.2 to the Leader of the Council from Councillor Ben Ingham

During the last ten years, the Conservative Group at EDDC have managed to deplete millions of pounds of reserves to nothing. The Leadership of this council, following the advice of senior officers, now want us to believe that selling the Knowle, refurbishing Exmouth Town Hall and extending a site at Honiton, which only weeks ago we were told should be sold, will save us money. The premise is based on a twenty year payback and a heating inflation rate of ten per cent over the period. On top of that, at a time when we are told to expect extensive cutbacks in local government funding, you say we should be borrowing millions. What on earth makes you think this is a rational strategy to deploy on behalf of the people of East Devon when you plainly have no idea whether EDDC will even exist in five years time?

Answer:

The Council’s audited Accounts as at 31 March 2004 showed usable reserves of £13.6m, the latest audit Accounts as at 31 March 2014 show usable reserves at £12.7m. The reserve levels will fluctuate between years to reflect what is considered the appropriate level to hold depending on risks and the Council’s need to earmark monies for specific expenditure in the future.

This Council is faced with extensive and unpredictable basic repair costs if it remains at the Knowle not to mention any investment in modernisation. These costs would be unfunded in the absence of a capital receipt from the sale of Knowle. Selling Knowle and prudent borrowing considered against capital and operational costs makes sense. The future may well be unpredictable so we need to be flexible in how we operate and able to manage change. One thing we can be certain of is that the Knowle is not fit for purpose and not a part of that future.

Question 8: Procedure Rule 9.2 to the Leader of the Council from Councillor Roger Giles

When was advice first given to the Council Leader, that the process for site acquisition and development of Skypark aspect of the Knowle relocation project would be likely to be required to meet EU regulations?

What advice was given about the likelihood of the proposals meeting EU regulations? What advice was given about the cost and timescale of meeting EU regulations?

Answer:

Throughout the process EDDC has received advice in respect of procurement including EU aspects from the Relocation Manager and EDDC Procurement Officer. Land acquisition and contracting are matters that need to include consideration of EU requirements. No secret has been made of the complexity of European law – one specific recommendation at the June Cabinet meeting was that the Council commission specialist expertise as required to advise on the detail of appropriate procurement, value for money and legal matters in relation to Skypark.

Between Feb and June 2014, the way forward on Skypark was the subject of discussion between officers and Executive Members including the Leader.

The advice we received was that EU requirements could be met as part of a build out on Skypark and negotiations began to that end. Various possible options were under consideration. These included the Council procuring the building contractor itself which would have added something of the order of 3-4 months time and associated preparation costs.

In actuality, negotiations with St Modwen began but did not conclude – the reason being that the Heathpark sale price was reduced and the marketing of Knowle and Manstone process got underway. At which point the Skypark discussions (and further legal costs) were parked.

Supplementary Q from Roger Giles:
In the 3rd paragraph of the answer it is stated: “The advice we received was that EU requirements could be met as part of a build out on Skypark and negotiations began to that end.” Does he accept that the advice given was flawed?

Supplementary Answer from Paul Diviani:”It was the right advice at the time”