EDDC internal Auditors Report: High risk: Capital Risk Assessment

Capital Risk Assessment

page 36:

The Capital Programme does not accurately estimate the cost or timescales necessary to implement the capital projects required by the Council to deliver its corporate objectives, leading to unanticipated additional spend or delayed completion of the capital programme.”

Page 37:

As part of our sample testing, we found that three of the four projects tested did not have a risk register to manage their associated risks. Relevant risks included uncertainties in securing external funding (Seaton Workshop), delays in completion of the project (Seaton Workshop, New Feniton Flood Alleviation Scheme and Mamhead Slipway) and significant overspends (New Feniton Flood Alleviation Scheme and Mamhead Slipway.)

Without formal risk management processes in place, there is a likelihood that individual projects are not identifying risks at an early stage leading to an increased risk of projects not being completed on time or within the agreed budget.”

Page 39:

In our sample of capital projects, it was evident in speaking to staff that the Council had not anticipated the level of funding required for the Seaton Workshop project at an early stage, which may suggest that insufficient research was done to review the viability of the project prior to approval of the project/budget.

The Finance Team should consider whether evidence to support capital appraisals should be clearly documented. They should also consider implementing clear guidance on the level of initial assessment which should be required to be undertaken for capital projects if this is not clearly stated on any current policy/guidance. Any approach should be based on the level of risk and funding of the project as it was evident that some capital projects are lower in risk and value than others.

There is a risk that proposed projects are not being subject to the right level of assessment which could increase the likelihood of funding the wrong projects, and could also lead to delays and overspend to individual projects.”

Click to access 020317combinedagagenda.pdf

Oh dear.

Barratt Homes in more trouble

“Barratt has sold 172 luxury London new-build flats as rental homes, including an entire block at Nine Elms.

Here’s an unusual move by a housebuilder: Barratt Homes has bundled together 172 flats at various developments across London and sold them off as rental homes.

The housebuilder said it had sold the units to Henderson Park for £140.5m. The portfolio includes 29 units at Aldgate Place, a joint venture with British Land, 25 in Fulham Riverside and all 118 at its Nine Elms Point tower in Vauxhall, a joint venture with L&Q.

The deal is Henderson Park’s first foray into the private rented sector: Greystar will manage the homes.

David Thomas, Barratt’s chief executive, called the move an “excellent opportunity”.

“In particular the build and sale contract for an entire tower at our Nine Elms Point development enables us to deliver homes more quickly than we would otherwise.”

Back in January Barratt reported the number of sales it completed in London had fallen more than 56 per cent in the six months to the end of December, to 367 from 842 the year before.

The company said it had lowered prices and was offering bulk deals, like today’s, to shift homes in the capital.

However, last month the housebuilder reported an 8.8 per cent rise in pre-tax profits during the period, partly thanks to the fact completions outside the capital were at their highest level in nine years.

Meanwhile, figures published by Hometrack suggested house prices in the capital grew just 6.4 per cent in January, the lowest growth in four years.

At the time Richard Donnell, insight director at Hometrack, said: “When you consider that house prices in London are 85 per cent higher than they were in 2009, it is not surprising that the pace of increases is slowing toward a standstill as very high house price increases mean affordability is stretched.”


When is a council asset not an asset?

” … If you didn’t know your local council had become a trader in gardening services, you may be even more surprised to learn it has turned into a property trader, buying up shopping centres, business parks, office blocks, hotels and garages. In 2016, local authorities spent over £1bn on real estate. [EDDC will be doing this when it funds its new Honiton HQ].

You may think this is a peculiar state of affairs when councils are simultaneously selling assets to mitigate budget shortfalls. But the arithmetic is simple. The Public Works Loan Board, a statutory body established in 1793, will lend at 2.5% interest. Property assets will yield at least 4.5% and often far more. The result is that local councils are becoming significant players in the UK property market, causing the Financial Times columnist John Plender to warn of its “creeping nationalisation”. Canterbury’s Whitefriars shopping centre (Kent), Sutton Coldfield’s Red Rose shopping centre (Birmingham) and Sunbury’s BP Business Park (Surrey) are all owned or partly owned by a local council.

Municipal enterprise is nothing new – councils sold local gas supplies in the Victorian era, and Joseph Chamberlain, Harold Macmillan and Anthony Crosland all proposed an expansion of municipal trading. But until recently, such opportunities were strictly limited by legislation that, for example, restricted them to trading only with each other. New Labour gave them explicit permission in 2003 to trade “ordinary functions” for a “commercial purpose”. In 2011, the coalition government’s Localism Act allowed them to do whatever they liked unless specifically prohibited by law. Now councils, having been forced to relinquish their roles as landlords of inexpensive housing for local people, re-emerge as landlords of multinational stores.

The dangers are obvious. If the property market were to crash, councils would be saddled with assets of dubious value. Moreover, it seems strange that, after deeming them incapable of running schools, Tory ministers are now happy for councils to manage investment portfolios covering areas of which they have little experience. But it is all part of the neoliberal vision for the world.

Boundaries between public and private sectors are being blurred. Since 1990 companies have been allowed, in effect, to bribe councils with payments for improved roads, new schools, high-street facelifts and affordable homes in return for planning permission. It is another step along the same road for the council itself to become a company and/or a property developer. Just as the state was omnipresent in the Soviet Union, stamping out entrepreneurial instincts, so the market becomes omnipresent in our society, sweeping away the ethos of public service. …”


North Devon Healthcare Trust CEO seems to be in the dark about its plans!

“What will happen to acute services at North Devon District Hospital? “I don’t know,” says Northern Devon Healthcare NHS Trust’s chief executive.

Alison Diamond gave a presentation at North Devon Council’s executive meeting on Monday, March 6, under special request from the committee.

The meeting took place at Cedars Inn to allow member of the public to attend and more than 100 people turned up to hear the update and ask their questions.

When asked what was going to happen to the Barnstaple hospital and the proposed cuts to its acute services, which includes stroke, A&E, maternity, paediatric and neonatal support, Dr Diamond did not know the answer.

She said: “I am here on behalf of the Sustainability and Transformation Plan (STP), which aims to provide a Five Year Forward View, to give an update. I do not have any answers today and I do not know what the model of care will look like because no decisions have been made yet.

“Our vision is to have people managing their own care and for that we need responsive care services and fair access to services. Our services are under review because the demand is going up, they were designed for the needs of people from a long time ago, we do not have enough staff, and the standards we have to comply with are always changing.

“Urgent and emergency care, stroke, maternity, paediatric, and neonatal are currently under review but others will follow.”

The emergency services review, led by Adrian Harris, medical director at the Royal Devon and Exeter, states there is a national requirement to meet seven day services, particularly with critical need patients.

It states staffing shortages, especially consultants and nurses, are becoming critical in some of our hospitals and people need to be seen in a timely way but we don’t meet the four hour target in some places in Devon.

The maternity service review, led by Rob Dyer, medical director at Torbay and South Devon NHS Foundation Trust, has found staff shortages in all three services, resulting in a high use of agency staff.

It has said it is more difficult to provide a service 24/7 and there are not enough choice for births, for example, if someone would like to give birth at home. It was noted to have a home birth the mother must live a maximum of 20 minutes from a hospital.

Dozens of members of the public, who were not required to give their names, stood up to put their questions to Dr Diamond and voiced many concerns about the proposed cuts.

The main points were:

Travelling times from the rural North Devon areas to hospitals in Exeter and Plymouth
Social care and appointments needed looking at to improve care
New housing developments would lead to an increase in the population needing care
Staff would not want to come to work at a hospital about to be downgraded
Rob Sainsbury, the trust’s director of operations, said Okehampton patients would be accommodated at Holsworthy hospital, just a day before their cuts were announced
What would the impact be on the hospitals in Exeter and Plymouth and the ambulance service?
Why can planned operations not be moved to more distant hospitals, rather than emergency care?
Is this a move towards privatisation?
One man stated: “The STP is butchering the NHS. Stop these cuts and give the taxpayers back their service.”

A woman added: “Everyone here has reason to be grateful to NDDH, we want it to stay and be improved if anything. We are asking you to help us. We want a hospital that is fit for purpose.”
And finally, a man said: “If someone dies on the road to the hospital, that will be on your conscience.”

Councillor Des Brailey, leader of the council, proposed the following statement of principles: “The council will not support any proposals to change preventative services, clinical care or social care, which it considers would disadvantaged the wellbeing of individuals or communities in North Devon.

“People should have ease and timely access to health services to achieve the best outcomes. The structural and service characteristics of any newly commissioned service must have regard to the population characteristics and the local geography of North Devon.”

The proposal was passed by the committee unanimously after it was amended to include equity, aspirational and affordability, as Councillor Frank Biederman stated: “I don’t want to see people having to choose between feeding their children and taking them to hospital.”

The next step is for the STP team to get feedback and create a model of care. Throughout March, clinical workshops and public engagement will continue. In spring, this feedback will be incorporated and in the summer, the options for change will be published, followed by public consultation on these options, led by the Northern Eastern and Western Devon Clinical Commissioning Group.

Challenges were raised in the Case for Change document created by the Success Regime:

One in three people live with one or more long term conditions
Two in three people would prefer to die at home and only one in four are able to
15 years life expectancy difference in some areas
Deficit of more than £550 million by 2020/21 if nothing changes
600 people in hospital do not need to be there
Care home sector is struggling
Stroke, maternity, A&E and children’s services are unsustainable in patches across Devon.
Less money is spent on health and social care in most deprived areas
95,000 people with a long term condition have a mental illness
One in 4 GPs to leave NHS in next few years.”


“Council applies for judicial review of one of its own planning decisions”

Would never happen here … though Owl does recall something not dissimilar … a while back.

“A local authority has applied for a judicial review of one of its planning decisions, after a councillor voted in favour of an application brought by her brother-in-law.

Applicant Nick Barrett, owner of a restaurant in Long Melford, had applied to Babergh District Council for permission to build an annexe.

His application was approved at a meeting in November 2016. The minutes of the meeting note that Melanie Barrett, Mr Barrett’s sister-in-law, had stated that she had a family association with the applicant.

The minutes of the meeting also said that another councillor had stated that he was employed by a family member of the applicant.

The minutes continued: “Following clarification from Phil Devonald, Interim Deputy Monitoring Officer -Programme Delivery, the legal advisor to the Committee, the Councillors asserted that the statements by Councillors Barrett and Holt did not constitute a disclosable interest by reason of close family relationship or employment as provided for under the Suffolk Local Code of Conduct adopted by the Council.

“He advised however that this was a matter of public perception and confidence in the transparency and fairness of the system and that Members should consider whether they should take part in the proceedings given the nature of their relationship to the Applicant. This advice was not accepted by the Councillors concerned.”

A spokesman for Babergh told Local Government Lawyer that the council had not received any complaints but the authority considered it necessary to take the issue to judicial review.

“On the one hand it is not a good thing that we are having to do this,” he added. “However, it shows that the mechanisms are there to review our actions.”

Mr Barrett told the Suffolk Free Press that the annexe was being built for his 87-year-old father.


Very sour grapes at Clinton Devon Estates towards EDDC!

Owl says: CDE not getting their own way with highly ontroversial AONB development blames officers and councillors at EDDC – CDE not happy bunnies!

[To] Housing Delivery Task and Finish Forum – Observations on Issues affecting Housing Delivery

“[From]Leigh Rix, Head of Property for Clinton Devon Estates Iestyn John, Partner at Bell Cornwell LLP


Clinton Devon Estates are rural landowners with substantial land and property interests in East Devon, notably in the southern part of the district between Exmouth and Beer. The Estate therefore operates within a large number of rural communities and in an area which is subject to a range of landscape and other sensitivities, all of which have with the potential to affect housing delivery. The Estate seeks to act as a responsible landowner with the principles of sustainability at the heart of all its activities. The Estate takes a long term intergenerational view which takes precedence over short term political and economic interests. It is within this context that its observations on the issues affecting housing delivery are provided.

In the Estate’s experience, there are two types of issues which are frustrating housing delivery:

cultural factors and technical factors

Cultural Issues

The absence within the Council of a positive, solution focused mindset necessary to properly resolve the undoubted tensions which exist between business, community and local politics, reflecting an agreed vision of how housing delivery will support wider longer term ambitions for the district in the context of an economically, socially and environmentally vibrant community. This absence appears to ‘set the tone’ for the setting of land use policy and decision making and may act as a barrier to investment in the area;

Greater pragmatism is needed, especially with regard to pursuing opportunities for properly considered housing proposals in rural areas. Such opportunities have the potential to act as a source of considerable amounts of additional housing without harming rural character. It is notable that earlier drafts of the Local Plan proposed to allocate 5% extra housing to each village. In individual villages, this would represent very small scale growth but is an approach, which collectively, would have contributed at least 500 more houses to the District’s identified supply than the approved Local Plan. The current approach of relying on neighbourhood plans to deliver local growth, whilst politically expedient, is inherently problematic especially in those areas in which the Estate operates, given the predominance of NIMBY interests which do not typically act in support of traditional local communities or longer term, future generational thinking;

Stronger, more decisive leadership is needed and at all levels. Amongst other things, this will generate certainty for the development industry and confidence that planning applications once supported, will be approved.

There are clear political tensions within the Council which create considerable uncertainties, delays and costs to bringing forward housing supply. The Estates’ experience with their development at King Alfred Way in Newton Poppleford is a clear example. Despite receiving officer support throughout the process, it took five years, four applications and five planning committees to secure a development which is modest in size, provides a high level of affordable housing and a clearly identified community facility in the form of a new doctor’s surgery. It will be understood that such problems do not act as positive signal to those seeking to invest in housing schemes – of any form – in East Devon.

Technical Issues

Some officers within the planning teams seek to apply seemingly needless bureaucracy; for example in the scope of the information they ask for to validate or process applications. It is obviously important that properly relevant information be provided, however unnecessary requests generate delay and cost and add little to consideration of the issue. We note the recent application validation list actually seems to make this issue worse. A more pragmatic and proportionate position is needed.

Feedback from statutory consultees is extremely slow. This is partly an issue of under-resourcing of these agencies which is out of the control of the Council. However, such poor responses have the potential to significantly delay decisions on applications. We would suggest that officers need to feel able to come to their own view on issues where specific advice is not forthcoming in a timely manner unless there are fundamental issues such as highways safety under consideration.

Officers need to support schemes which are common sense and where there is unlikely to be any harm to wider objectives. It is notable that there are various schemes in the Cranbrook area – a central part of the Council’s housing delivery strategy – which are not being determined until the Council’s much delayed SPD for the area is approved. In this core location, the Council appear to be getting locked into a planning rather than delivery cycle which prevents certain sizeable schemes e.g. the non-consortium site at Farlands from coming forward with, in that case, an approval for 200 + dwellings.

From the experience of the Estate it would seem that some members of Development Management and other Committees require training in their responsibilities and the planning process as well as more general Committee Management skills. Poor quality, ill informed decisions made by members disregarding legal and planning advice causes increased skills costs for housing projects and local taxpayers as well as a lack of delivery of schemes which meet agreed local plan criteria.”

Builder lied to become unqualified chief of two south-west NHS trusts

“John Andrewes admitted fraud and gaining financial advantage when he appeared at Exeter Crown Court on Monday. He lied on his CV, claiming he had a PhD to become a chief of two NHS trusts.

Jon Andrewes, 63, admitted fraud and gaining a financial advantage when he appeared at Exeter Crown Court, where he is being sentenced today.

The Walter Mitty style health chief said he had a PhD which meant he could call himself a doctor.

He chaired the Torbay NHS Care Trust for nearly ten years, and was a former chairman of the Royal Cornwall Hospital Trust.

He also earned nearly £100,000 a year as chief executive of a Taunton hospice in Somerset.

On CVs Andrewes claimed to have a management PhD from Heriot-Watt University in Scotland, as well as a ‘first degree in PPE’ and an MBA ‘with a financial specialism’ from Bristol University. All these claims are untrue. He also claimed to have been a partner in a technology firm before retiring early.
Andrewes, from Totnes, Devon, had worked as a social worker, probation officer and builder before using his fake CV to start his healthcare career in 2004.

In January, a senior NHS source said: ‘It took investigators a couple of days to discover the truth about Andrewes. Once they started looking at his claims closely everything started to unravel.

During one court appearance, the prosecutor called him a Walter Mitty. That is exactly what he was. It is amazing he managed to reach such top jobs built on a CV made up of lies.

‘It beggars belief that no due diligence was carried out when he was appointed to these NHS trust roles.’

Andrewes pleaded guilty to dishonestly making a false representation over his qualifications to make a gain as chairman of Torbay NHS Care Trust in July 2007.

He admitted a second charge of false representation over his qualifications to make a gain as chairman of the Royal Cornwall Hospital Trust in Truro, Cornwall, in April 2015.

He also admitted making a financial gain for his role as chief executive of St Margaret’s Hospice in Taunton, Somerset, by deception in 2004.
He pleaded not guilty to a fourth charge of having a false degree certificate from the University of London which he is accused of using in connection with a fraud.

He will be sentenced today.”