Flybe – trouble at the top

“A battle over the cut-price sale of Flybe will gather pace next week after the airline’s biggest shareholder demanded the sacking of its chairman.

Sky News has learnt that Hosking Partners wrote to Flybe on Friday to requisition an extraordinary general meeting (EGM) aimed at ousting Simon Laffin, the City grandee who has chaired Flybe for five years.

The fund management firm run by Jeremy Hosking, a prominent investor, wants to install Eric Kohn, an experienced aviation executive, in Mr Laffin’s place.

A statement confirming the EGM request is expected to be made by Flybe to the London Stock Exchange as soon as Monday morning….”

https://www.theguardian.com/business/2019/jan/26/small-supermarket-wales-owned-surrey-casino-property

“‘Casino councils’ are spending huge sums on property across the country in a high-stakes bid to balance their books”

“…Councils across England are under huge pressure to adopt a more expansive investment strategy, as their funding from central government is slashed. Many have responded by loading up with debt to play the property market, exposing some to a ticking timebomb of high borrowings and the nascent threat of a property-market collapse.

The omens are not good for retail landlords. Last week the real estate adviser Altus Group forecast that 23,000 shops would close in the UK this year – with a loss of 175,000 jobs – while the Royal Institution of Chartered Surveyors (Rics) told valuers to be “aware of the potential for significant changes in value” in retail properties. Last month fund manager Fidelity International warned that UK retail properties could lose up to 70% in value as a result of rent cuts. The correction would be driven in part by a 10-40% reduction in rents to make them affordable for bricks-and-mortar retailers, Fidelity said.

The Local Government Chronicle (LGC) said the amount spent by councils in England on investment properties ballooned from £76.4m in 2014-15 to £1.8bn in 2017-18. These include offices, hotels, supermarkets and gyms, sometimes miles outside a council’s own area: these out-of-area investments are worth £619m alone.

Lord Oakeshott, chairman of Olim Property, which manages commercial property portfolios for institutional clients, said: “The whole thing is a mess. Councils are being loaned vast amounts of money by government, which is being invested in property. It’s a hell of a gamble that these councils are taking and this is not what councils should be doing.”

If the economy does take a turn for the worse, councils may find their current roster of reliable tenants forced to take evasive action. Store and office closures are a common cure when companies begin to feel the squeeze. A deepening economic crisis and a soaring debt pile makes for a toxic financial cocktail that some “casino councils” may be forced to swallow. Authorities will be forced to find new tenants who might not be able to pay the same levels of rent – if they can find new tenants, that is.

… But with Brexit looming the property sector is particularly vulnerable. The Bank of England has warned that “disorderly” Brexit – where Britain crashes out of the EU without a deal – could make the price of offices, warehouses, shopping centres and hotels drop by as much as 48%– more than the 42% peak-to-trough decline following the 2008 crisis. Even with only a “disruptive” Brexit – where the UK retains access to some trade agreements between the EU and other countries – the Bank suggested property prices could still fall 27%. … “

https://www.theguardian.com/business/2019/jan/26/small-supermarket-wales-owned-surrey-casino-property?CMP=Share_iOSApp_Other

“California sues wealthy coastal city over low-income housing”

“Gov. Gavin Newsom used a new law for the first time Friday to try to force a wealthy Southern California coastal city to end its years of opposition to meeting low-income housing goals.

Newsom’s administration sued the Orange County city of Huntington Beach under the law that took effect Jan. 1 after passing in a 2017 package of measures intended to alleviate the state’s severe housing shortage and homelessness problem.

California has more homeless people than any other state and the nation’s highest poverty rate when soaring housing and rental costs are taken into account. Newsom, who took office this month, has proposed building 3.5 million housing units in the state with nearly 40 million residents.

The lawsuit says leaders in Huntington Beach, home to about 200,000 people, have repeatedly refused to amend the city’s housing plan to add state-required low-income housing and are fighting a separate lawsuit by housing advocates. The city says it’s complying with state housing and zoning laws. …

Newsom said high housing costs and rents “are eroding quality of life for families across this state.” He said the problem is “an existential threat to our state’s future and demands an urgent and comprehensive response.”

He has promised several moves to increase affordable housing, including giving cities more money for housing shelters but taking away transportation money if they fail to meet their goals. The Democratic governor’s budget proposal seeks $1.75 billion to combat homelessness by encouraging new affordable housing.”

https://www.seattletimes.com/business/california-sues-wealthy-coastal-city-over-low-income-housing/

Are DCC councillors refusing to let Claire Wright’s star shine before local elections?

Owl says:

Local council elections: 2 May 2019

Greater Exeter Strategic plan:
not going out for consultation until June 2019

Claire Wright’s long-promised inquiry into how Devon carers are coping:
Delayed by at least a year to June 2019 at the earliest

Anyone smell rats (on a sinking ship)?

“My efforts to get a spotlight review into how Devon carers are faring seems to have hit another delay.

I first proposed a review at the April Health and Adult Care Scrutiny Committee meeting of last year, but the vote was delayed until councillors had visited the contractors who look after the service, Westbank League of Friends.

My interest in the subject was sparked after reading a report which indicated that many carers were feeling exhausted, ill and short of money. Here is the background –

http://www.claire-wright.org/index.php/post/scrutiny_review_to_take_place_into_how_devon_carers_are_coping

After a useful meeting at Westbank, I duly proposed a spotlight review once again at the September meeting. It was agreed this time.

I have now enquired twice when this review is going to have its first meeting but have had unsatisfactory answers.

At yesterday’s committee meeting I asked again when the first meeting was going to take place.

I was told that it wouldn’t take place until at least June as more information was needed.

I pointed out that this was almost a year after I had proposed the review (actually it is longer as I originally proposed it last April but it was not agreed then).

But the chair said the information was required before a spotlight review was held.

This is deeply disappointing and feels as though the issue is being kicked into the long grass.

I know many carers out there are struggling and to defer this issue is unfair and wrong in my view.

I will definitely be pursuing this.”

http://www.claire-wright.org/index.php/post/review_into_how_devon_carers_are_faring_delayed_until_after_june

“We Need A Complete Rethink Of How We Fund Our Public Services”

Jonathan Carr-West
Chief executive of the Local Government Information Unit (LGiU):

“A few weeks ago, a radio producer called the LGiU office desperately seeking a guest for a head-to head debate on local government funding: “I’ve booked someone to argue that local councils need more money, but I can’t find anyone who disagrees”. That didn’t come as much of a surprise.

I regularly speak with council leaders who nearly all tell me a decade of deep cuts have left them at breaking point. Regardless of party allegiance, senior decision-makers unanimously agree that councils are in an unsustainable position, and some are nearly bust.

Local government in England and Wales is funded through grants from central government (about 54%) made up mainly of redistributed business rates, and locally raised funding (about 46%) which includes council tax and other sources such as car parks, parking permits and the hire of sports facilities.

Local authorities have already seen their central funding reduced, on average, by 40%. In Haringey, for example, the council’s spend per head of population has dropped by nearly a quarter. HuffPost’s What It’s Like To Lose series shows how people have already suffered the impact of the cuts.

However, from next year the Government has committed to phasing out central grants for local government, representing a further cut of more than £1billion at a time when the number of elderly people needing care is growing. Last year, the Prime Minister said it was the end of austerity. Not for local councils, it seems

To offset that savage cut, some councils are borrowing billions of pounds to buy property, supermarkets and gyms. At the same time, residents are paying more and more money to their local authority through higher council tax, and through increased charging on everything from swimming pools to cremations. But they will be receiving less, because it is the money from central government that pays for, amongst other things, adult social care and vulnerable children’s services, which is shrivelling up.

The most worrying aspect of all, though, is that local councils are still totally in the dark about how they will be funded from 2020. With only a year to go before the central grant disappears, the plan to allow councils to retain their local business rate income, which was supposed to make up the shortfall, has is yet to be agreed, never mind rolled out,.

Meanwhile, the government’s ‘Fair Funding Review’, which will change the calculation of each council’s funding needs, is yet to be finalised. The review’s first iteration has been criticised for removing deprivation as a funding criteria and shifting spending away from urban areas.

The LGA has consistently said that resources announced in the Autumn Budget and local government financial settlement are nowhere near enough to meet a gap in overall funding of more than £3billion. Clarity on the future shape of the system is desperately needed but the issue has failed to move up the Whitehall priority list due to Brexit.

Local government is the most important bit of government. Councils deliver the things that really matter most to us: schools for our children, clean, safe neighbourhoods, new homes, care for the elderly. All these services are delivered from the town hall, not Whitehall.

But there’s a paucity of ideas when it comes to fixing council finances: the government wants local authorities to raise more and to be more entrepreneurial, yet it balks from them taking any commercial risk.

Other proposed solutions leave councils with less autonomy when they need more – for instance, some have suggested that social care be delivered nationally or that councils should funded solely through central government grants.

Broadly, councils want to avoid being subject to the whims of central government policy-making to allow them to plan their own finances. Councils are calling for more control over areas of DwP and health that affect their ability to help their residents.

That means a complete rethink of how we fund public services. Instead of letting councils’ spend wither away, we need to localise our spending on all public services creating single place-based budgets that democratically elected leaders can spend in the ways that make most sense locally and that drive down demand.”

https://www.huffingtonpost.co.uk/entry/local-services_uk_5c4b3431e4b0e1872d433381

“Councils made to give £225k BACK to developers – often because they didn’t spend it quickly enough”

Could it, has it happened here? Only a Freedom of Information request will tell …

“More than £225,000 of Section 106 money has been handed back by councils – mainly because they did not spend it in time.

The money, paid to councils by developers, is meant to go on road improvements, public transport and community facilities at new housing estates.

S106 contributions are often included as a way to overcome objections and as a condition of planning approval.

But on a number of occasions in the last five years the money was returned because Suffolk councils had not spent it within a five-year limit, Freedom of Information requests from this newspaper show.

While the sums are a fraction of total S106 contributions made, councillors said they showed deep failings within local government.

Andrew Stringer, leader of the Liberal Democrat, Green and Independent group at Suffolk County Council (SCC), said it was “perverse” that developer contributions were going unspent during a time of austerity.

Much of the returned funding was down to SCC’s failure to carry out highways projects. …”

https://www.eadt.co.uk/news/section-106-ipswich-saxmundham-haverhill-housing-developers-1-5866556

Greater Exeter Strategic Plan – where are we? In trouble!

All change on the Planning Front for East Devon.

Ever since David Cameron’s coalition government’s efforts to provide local communities with a say in local planning decisions with the “Localism Act” in 2011 (giving communities the power to draft “Neighbourhood Plans,” designed to provide a degree of self-determination to how local communities could be developed in the future) the powerful developers and landowners lobby has been active to reclaim their powerful grip on developing our communities.

First was the new National Planning Policy Framework (NPPF) in 2012 which threw out the old planning regulations and provided a “developer-driven” new planning policy, with just a “nod” to the Localism Act, Neighboured Plans and District wide plans.

The new NPPF introduced a policy that if the District or Neighbourhood Plan was not “up to date” then there would be a presumption of allowing any proposed development from a developer. Therefore, Councils and local communities quickly set about drawing up their Neighbourhood Plans and District Plans to plug the gap created by the new 2012 NPPF policies.

East Devon District Council who had been dragging their feet for years to complete their Local Plan, finally managed to obtain the approval of the Planning Inspectorate in January 2016 to cover the period up to 2031. Lympstone had got its Neighbourhood Plan approved in 2015 and since then over 30 Neighbourhood Plans are either approved or in the process of being drafted by community groups within East Devon.

It was therefore thought that East Devon and its communities had substantial protection from greedy landowners and developers up to 2031 and with the extra protection of the East Devon Villages Plan, approved in July 2018 (which gave further defined policies for larger Villages and some large Business Parks) residents and developers appeared to understand where development would or would not be allowed.

However, in late 2016 Exeter City Council, whose Chief Executive Karime Hassan (previously East Devon’s District Council officer who created and developed the concept of the new town of Cranbrook) proposed a joint “Strategic Plan”, along with neighbouring councils East Devon, Teignbridge, and Mid Devon.

The four councils then started a joint over-riding masterplan for Exeter and the surrounding area known as the GESP (the Greater Exeter Strategic Plan).

It was clear that Exeter was almost completely built-out and the infrastructure in roads and transport required for further city centre and commercial growth was urgently required if the continued success known as the “Exeter Growth Point” was to continue. Without a joint plan for infrastructure, the commute into the City would become intolerable and hinder the targeted housebuilding requirements set by the Government for each of the 4 separate councils.

In October 2018 the Government draw up yet another updated version of the NPPF (National Planning Policy Framework) very much on the lines of the 2012 Policies, but with various tweaks to assist in the over-riding government strategy of encouraging developers to build many more dwellings.

The new 2018 NPPF provided clearer guidance that if an individual Council was unable to provide enough development land for extra dwellings required by the government’s growth targets, neighbouring councils may be allowed to build out extra housing for their partner and other neighbouring authorities.

According to East Devon District Councils Strategic Planning Committees agenda item 12 for discussion on the 29th January 2019:

“Timetable for production of a new East Devon Local Plan”

Within the introduction to the agenda item it states:

…given changing circumstances and other factors, that a “light touch” review of the currently adopted local plan is unlikely to be a practical option for a new local plan.”

What the changing circumstances and other factors are, is not explained but it is clear from the report it is clearly in relation to GESP.

Because the GESP Strategic Plan policies will over-ride the East Devon Local Plan policies, the report seems to suggests that the “changing circumstances and other factors” relate to the new GESP policies which override the Local Plan, Village Plan and probably most Neighbourhood Plans – affecting a large area of East Devon! So much so that, rather than the GESP plan dovetailing into the 3-year-old approved East Devon Local Plan and 1-year-old Villages Plan with all the years of public consulting, Council debate and literally years of work by the planning team, it will be jettisoned for a brand-new Local Plan to dovetail into the strategies of the GESP plan!

Although the GESP plan has been in preparation for 2 years, no formal discussion or meeting has been held at any Council Chamber at any of the four Councils involved. Meetings have taken place to consider the 700 plus sites throughout the Greater Exeter area submitted for assessment by what is known as the “Housing and Economic Land Availability Assessment (HELAA) panel” The Panel is made up of “key stakeholders”, with a recognised interest in the development of land for housing and employment, and housing and economic development sector, including housebuilders, social landlords, local property agents and other related professionals together with local community representatives and other agencies. The membership of these meeting has been confidential and there has there been no publication of their deliberations or recommendations.

To be clear: meetings between two lead councillors from each Authority, plus officers have kept the draft policies and site options totally under lock and key – with none of the meetings been reported or minuted.

However, all is to be revealed AFTER the local council elections in May 2019 – consultation has always been scheduled to begin no earlier than June 2019.

This suggests that the draft policies and site options affecting East Devon will be so radical and so totally at variance to the East Devon Local Plan and Villages Plan that they will all require total re-writing, with a brand-new Local Plan (subsidiary to GESP) and all the costs and uncertainties this will bring.

Why have these Councils been so secretive on the GESP proposed development site considerations for proposed strategies for commercial and housing development for this part of Devon? Could it be that Tory controlled East Devon, Teignbridge, and Mid Devon Councils have elections on May 2nd this year (Labour Exeter elects only one-third of its council this year) and a brand new super-growth plan – superseding their Local Plans – will not be considered much of vote-grabber?

Don’t say you weren’t warned!