Agenda item

Statement from Council Owned Companies

To receive any statements from Directors of Council Owned Companies.


In accordance with Procedure Rule 4.2.24 the total time allocated to this item shall not exceed 10 minutes, and no Director, except with the consent of Council, shall speak for more than 3 minutes.



Simon Weeks, Non-Executive Director of Optalis:

I am reporting to Council in my capacity as Non Executive Director for Optalis, WBC’s wholly owned social care business.  Year to date turnover and profits remain ahead of budget and the forecast for the full year remains on budget.  Cash flow remains well controlled and also on budget.  Whilst sickness absence has improved over the year, our agency spend is still ahead of budget.  Staff turnover has reduced and is now significantly below that of both local and regional averages for the care sector.  However, recruitment remains very challenging in a highly competitive market, even though we already pay at least the living wage for all care staff.  This constrains our ability to take on private home care business and necessitates ongoing agency spend.  However, we have recently held recruitment events at Trinity Court and the Oakwood Centre in Woodley.  Having refined the job description within corporate commissioning and the holding company, recruitment is now also underway to secure the services of our new Managing Director.


A new extra care unit at Clement House was opened last month by the Countess of Wessex and is now fully operational.  Additional investment at Suffolk Lodge is planned.  At the Commissioner’s request we have recently taken over independent living services from another provider and its staff have been TUPE’d across to Optalis.  In successful partnership with Reading College, Optalis has over the last year provided support services assisting young people with disabilities into employment.  It is hoped that they fund a second year from September.  The joint Interim Managing Directors of Optalis have provided consultancy services and expert advice to Bury Metropolitan Borough Council, a Labour controlled local authority and this has enabled them to establish their own local authority trading company.  This demonstrates that Optalis is pioneering work in this area and is well regarded by other local authorities while facing the inevitable and escalating demand and increasing costs of providing quality social care for residents. 


Negotiations regarding a new contract with WBC are ongoing and we are also awaiting the results of several tenders from a number of local authorities in the South East.  Partnership working with the Commissioner continues to strengthen and Optalis Directors regularly attend Board and Company meetings.


David Chopping, Non-Executive Director of Wokingham Housing Limited:

This is an interesting year for the Housing Companies, one which marks a series of milestones and the quantum leap we are all taking in this massive investment for the future.  Starting with personnel, our first Managing Director Robin Fielder has now left, to be replaced by Bill Flood.  Bill is driving forward the application for Registered Provider status for Loddon Homes. 


Dealing first with Phoenix, we have tendered the contract and are now in the process of appointing the winning bidder.  The winning tender price is £11.454m but value engineering work and an element of contingency are expected to bring the final bill cost to very close to the £11.1m level estimated and reported to Council previously.  We expect to release the site to the contractors in the next few weeks and we will endeavour to advise Council as to final details at our next meeting.


Fosters is more complex as you have already heard.  It is the subject of not being big enough for the larger firms and thus we have not had the level of interest from contractors through the Homes and Communities Agency Contractor Framework as we anticipated.  We are therefore changing our approach to ensure we receive the best possible bill price and are offering the opportunity to build the scheme to smaller, specialist extra care contractors.  This adds a further two or three months to the project completion dates, some of which we do actually expect to recoup but ultimately we will have to wait for rent receipts a little longer than first planned.  However, when balanced against bill project costs, the longer wait for rental income is deemed a sensible trade off and will save the Council and taxpayers money in the long term.  We feel being prudent with your money is more important than taking a chance.


Registration of Loddon Homes with the HCA as a Registered Provider has been made much more complex by the recent proposals coming out of Whitehall.  Moving quickly with the application is also becoming more important.  One of the criteria for registration is that Loddon Homes must demonstrate an appropriate degree of independence from WBC.  As a result the Boards have been changed and it is this information that I think is important that Council is made aware of.  Alistair Auty and I remain on both Boards to form the link between the companies.  We are joined on WHL by John Jarvis, another Chartered Surveyor, but this time with his main expertise as a Quantity Surveyor.  I remain Chairman and Alistair has been appointed Vice Chairman.  Bill Flood makes up the Board with the assistance of our accounts expert John McNiece.  John Jarvis has already made an impact as we went through the contract assessments for Phoenix.  The HCA will not accept the same Chairman or Vice Chairman on both companies so the Loddon Board now comprises Gary Cowan as the appointed Chairman, Robin Fielder, our former Managing Director, as Vice Chairman, Lee Newton as the tenants’ representative with Alistair, Bill and myself, together with John McNiece.  We are also discussing a further appointment with the recently semi-retired Finance Director of one of the larger local Housing Associations who will add scrutiny skills and expertise to support Gary as Chairman.  If negotiations are successful he will be asked to chair Loddon Homes Audit Committee, a requirement of the HCA registration process, that this be independently managed.  Finally WHL and Loddon Homes continue to put together a pipeline of developments, planning on another scheme, our seventh, was granted last night, and I am confident that we can make full use of all available commuted sums.  However, we do want more sites so please do keep your eyes open for us.  WHL’s future may be more as a development company with the purely social housing sitting within Loddon Homes.  However, to a great extent how the housing companies evolve from here will be determined by how the Council wants to respond to the Government’s changing housing policy agenda and how we feel we can best serve the needs of our residents.