Hereford Futures - Council does not hold board papers

[twowheelsgood]

This story was on the front page of the HT website today for about 15 minutes before it was pulled - the link is here, as are my comments. Bill Tanner is doing some excellent work on the Futiles at the moment - we all suspected (and knew) that we were being stitched up - now we are starting to see by just how much and measures being taken to try and withhold the facts.

 

http://www.herefordtimes.com/news/11058417.Hereford_Futures___council_does_not_hold_board_papers/?ref=var_0

[SON OF GRIDKNOCKER]

Once more, Two Wheels is 'on the money'.  Bill 'Scoop' Tanner is doing his best to expose this thoroughly murky business, but municipal obfuscation muddies the water.

 

For those of you with a strong stomach (that is, you can sit and watch democracy being humiliated) go along to next Moday's Scruting Committee session.  The doughty Alan Seldon (our very own Margaret Hodge), ably assisted by Liz Harvey, will attempt to put Eric Pickles-lookalike Jonathan Bretherton through the Brockington shredding machine.  But will it work?  Hell will freeze over first, my friends..

 

Now that this authority is effectively run by Cabinet, every committee (including Srutiny) can be stuffed with know-nothing Tory dimwits.  And if the Tory dimwits of the Scrutiny Committee are otherwise engaged next Monday (gold club agm, day at the races etc), then Leader Tony Johnson simply drafts in other dimwits to 'represent' them.

 

Roll on May 2015!

[megilleland]

Two stories here for the record:

 

Hereford Times: 10:57am Thursday 6th March 2014 in News By Bill Tanner

 

HEREFORDSHIRE Council has paid out nearly £3m in financial support to Hereford Futures Ltd (HFL) over the past 11 years.

 

The council denies that the sum shows HFL  as having been “exclusively funded†by the public sector – either directly or indirectly - throughout its existence.

 

However, in a new report, the council concedes the appearance of it having “wholly funded†HFL since 2012.

 

That report will go to the council’s overview and scrutiny committee for debate on Monday (March 10).

 

HFL was set up by the council in 2010 as an “arm’s length†company limited by guarantee to drive redevelopment in the city. It was a successor to Edgar Street Grid (Hereford) Ltd or ESG.

 

In May last year, the council confirmed HFL was being wound up.

 

The company – with the council acting as guarantor - was not subject  to audit and accountancy obligations that apply to regulated local authority companies, nor was it covered by Freedom of Information (FoI) regulations.

 

HFL was, however, admitted to the council’s pension fund.

 

Figures produced for the scrutiny report  show the council’s total contribution to HFL from 2004-05 to 2014-15 to be £2,891,556, with a peak annual contribution of £409,405 in 2012-13.

 

Support in the current financial year is shown as £355,322, reducing to £130,628 in 2014-15.

 

The directors report and financial statement for the year ending March 31 2013 records the turnover of HFL as £458,084 with administrative expenses of £466,180.

 

That means an operating loss  of £8,096 and an overall loss for the financial year of £7,049.

 

An appendix to the report sets out the funding for HFL or ESG by the council and Advantage West Midlands (AWM), the former regional economic body.

 

Those figures show the sums of grant drawn down from AWM between 2004-05 to 2012-13 inclusive.

 

The total drawn down over those nine years is £13,177,419; with a peak annual draw down of  Â£3,339,377 in 2007-08.

 

Another appendix shows AWM’s net rental income  contributions to HFL from Hereford properties acquired by AWM – a total contribution of  Â£1,490,096 over the nine years to 2013-14, with a peak annual contribution of £308,991 in 2007-08.

 

The council denies that HFL been exclusively funded by the public sector - either directly or indirectly - throughout its existence.

 

As “full picture†of HFL funding shows  refunded costs were received from external organisations by the council , which then redirected them into the HFL budget - as required by the joint venture agreement with the council and AWM.

 

However, the council concedes that since 2012 it appears that HFL has been “almost wholly funded†by the council.

 

References to the funding of  HFL in the council’s Local Investment Plan 2011-2026  state that  HFL was established as a joint venture company with AWM; but that AWM funding would come to an end from 31 March  2011; and that, from 1st April 2011, the company would be ‘fully funded’ by the  council.

 

Overall, the council confirms it has provided just under £2.9m of funding to HFL, including refunded costs from external organisations, and  AWM provided over £14.5m of direct funding and rental income contributions.

 

In addition, some £88m of private sector funding  is being invested in the old market development – as reported to cabinet in April last year.

 

and

 

​Hereford Times: 11:27am Thursday 6th March 2014 in News By Bill Tanner

 

Herefordshire Council in talks over taking on the liabilities of Hereford Futures

 

TALKS are underway between Herefordshire Council and the Homes and Communities Agency (HCA) over the extent to which the council can take on the liabilities of Hereford Futures Ltd (HFL).

 

Confirmation of the talks comes in papers prepared for a meeting of the council’s overview and scrutiny committee on Monday (March 10).

 

The report of the HFL directors’ for the year ending March 31 2013 states that the company has net liabilities as at that date.

 

In April  last year the company was told it would cease its operations, which would be transferred to Herefordshire Council, and ultimately would be wound up.

 

However, HFL did receive confirmation from  the council that “sufficient funding†would be made available to the company to enable it to fulfil its  obligations and to pay liabilities as they fell due.

 

The scrutiny papers confirm that on May 30 last year the council’s then Chief Finance Officer (CFO)  wrote to the  directors of HFL to confirm the council’s funding commitment to the company.

 

In this letter it was recorded that the council had requested HFL to continue to trade in  accordance with agreed business plan priorities and then wind down.

 

In consideration of  HFL directors agreeing to this request, it was also confirmed that the council would  provide funding of a maximum value of £695k in a combination of revenue and capital - by way of non-repayable  grant - during the financial years 2013-14 and 2014-15.

 

The letter went on to record  that HFL was intending to operate in a financial envelope of £485,950 and that  Â£695,000 was to be the maximum sum that would be made available to HFL to enable the directors to “discharge in full the liabilities of the company as they fall due†and repay all remaining liabilities together with costs and expenses associated  with the  wind down.

 

An appendix to the scrutiny report shows council funding of £355,322 in 2013-14; and £130,628 in 2014-15 and rental income contributions estimated at £95,600 for 2013-14: a total of £581,550.

 

The difference between this and the maximum sum of £695k referred to in the then CFO’s letter is £113,450 that the council says relates to an “available funding resource†that  can be accessed following agreement to a “funded business case†submission.

 

Presently, council officers are in talks with the HCA and HFL about the extent to which the council may take on any HFL liabilities in the future.

 

However, the report confirms that, other than the May 2013 letter from the then CFO, no assurances or commitments have been given by council officers.

 

As such, the issue will be reported to the council’s cabinet for a decision in the coming months.

 

The council concedes that it is “probably reasonable to infer†from the directors’ report for 2013 that, at  the date the report was approved by the HFL Board,  the directors considered the council’s financial commitments in the May 2013 letter to be sufficient to cover the company’s then known liabilities.

 

Council officers have “not subsequently been advised differently†the report says.

 

You can read the reports I posted on this thread - scroll down to post 143

[megilleland]

And more here:

 

Hereford Times: 12:34pm Thursday 6th March 2014 in News By Bill Tanner

 

Hereford Futures - council does not hold board papers

 

HEREFORDSHIRE Council has no HFL board papers despite councillors and the council’s former chief executive attending HFL Board meetings - and the council committing nearly £3m in funding to the company.

 

That confirmation comes in papers prepared for the council’s overview and scrutiny committee on Monday (March 10).

 

The council says that as none of its serving officers are director HFL it is “difficult to give a definitive answer†as to why HFL board papers were not in its possession.

 

However, the council says that any councillor who attended an HFL Board meeting will have done so “in their capacity as a director of the company†and not as a councillor.

 

In the event, the council says, that members they held any HFL papers, they will not have  been held in their capacity as a councillor.

 

In January this year, the overview and scrutiny committee considered a report  relating to the Freedom of Information (FoI) act and arm’s length companies.

 

Members were told that  FoI did not apply to HFL as an arm’s length company despite the extent of the council’s funding of the company.

 

Instead, the council says, the company’s creation, redevelopment remit, and subsequent activity had been considered in a series of  reports to Cabinet.

 

The council maintains that where the performance of any council service, whether delivered in  house, or through a third party such as HFL, is of interest to the public, or is causing concern, it can be “monitored and assured†by overview & scrutiny.

 

TwoWheelsGood says...

 

"However, the council says that any councillor who attended an HFL Board meeting will have done so “in their capacity as a director of the company†and not as a councillor."

 

This is compete rubbish - the Articles of Association of Hereford Futures Ltd make it quite clear this is a public-private-partnership and that the Council Leader and the Chief Executive sit on the board because they are representing the council and that they could not hold the position otherwise.

 

As directors they would have had access to all documents - to say otherwise is simply unbelievable.

 

Good comment.

 

 

[SON OF GRIDKNOCKER]

Exactly a year ago at a Press Conference organised by Sanctuary Housing, former ceo Jonathan Brethrton announced that despite the winding up of Hereford Futures he would be 'staying on' to oversee the launch of the marketing of the midlands housing association's much-vaunted Urban Village.  What special marketing skills the fat man possessed was known only to Council Leader Jarvis Cockup.  

 

To date, the only evidence of this mythical village, is a metal hoarding in Conningsby Street announcing that a small block of flats is to be erected there for occupation in 2015.  Some urban village!  So does that mean that this Eric Pickles lookalike intends to hang around for ANOTHER year?

 

Go back to Cleveland Mr Bretherton - you've more than outstayed your welcome!

[dippyhippy]

Two Wheels, the story has been reinstated on HT.

Whatever the issue earlier, it appears to have been resolved, and comments are still enabled.

I have no idea what happened this afternoon. There are three Hereford Futures stories up, I commented on two of them, then as you say, this one was pulled for a while.

Somebody somewhere, trying to pull the plug.....??

[twowheelsgood]

No, its gone again, as indeed has the usual summaries from the RH side. I don't doubt the Council were on the phone to Feeona as soon as the article was published.

[dippyhippy]

Meanwhile....back over at HT headquarters....I see Bobby has had a personal response from Pat Morgan on the fortnightly bin collection thread.....she is yet to reply to my concerns!!

[Biomech]

In all honesty, while it would stink to high heaven, I could survive on a fortnightly collection.
However, I don't live with an average sized family nor do I live in a block of flats.

 

As I've said before, now with the recycling, black bag collection is pure rotting meat, eggs, cream etc. And that's going to cause problems, particularly in overcrowded areas and in the summer. If any of you have to put cat or dog food into a bin, you'll know that after about 2 days the smell becomes unbearable.

[flamboyant]

DIPPY have you ever noticed that Councillors will only engage when they are looking for information? It's never ever a two way street. I have directly asked Councillors questions on a number of occasions but never once had a direct answer. The usual response being someone else is looking into that or I will get back to you, which of course they never do. Cllr Morgan's response to Bobby will be an example of how Councillors engage with the public. There was no way of responding to your question that was going to make Cllr Morgan look good.

[twowheelsgood]

Yes, as the site has become more established, it is glaringly obvious that its mostly one-way when councillors pop up. I note we are still waiting for Cllr Kenyon to report back on his meeting with Balfour, despite a follow up request.

[Biomech]

flamboyant, I agree, I have asked a number of rather basic questions that I have never had so much of a reply to

[Denise Lloyd]

DIPPY have you ever noticed that Councillors will only engage when they are looking for information? It's never ever a two way street. I have directly asked Councillors questions on a number of occasions but never once had a direct answer. The usual response being someone else is looking into that or I will get back to you, which of course they never do. Cllr Morgan's response to Bobby will be an example of how Councillors engage with the public. There was no way of responding to your question that was going to make Cllr Morgan look good.

Apart from 1 or 2 exceptions I notice that they only become slightly more high profile when there is a local election coming about  

[flamboyant]

Yes to my knowledge there is one exception I would agree with. I have noticed on several occasions Cllr Glenda Powell responding so she's not included in the statement above.

 

TWG .... I also put questions to wizard wonky who never got back with a response either! 

[dippyhippy]

Afternoon Flam!

 

Yes, sadly you are quite right. It really is only when they have something to trumpet about - "I work very hard for my constituents, and I am going to ram that fact down your throat, whenever the opportunity arises!" - or there's an election looming!

Now and again they join in with a discussion, but always remove themselves from anything too contentious -( IT contracts thread??)

 

As Two Wheels pointed out over on HT, Pat Morgans response seemed to have been drafted by a 16 year old!!

 

Many of them would do well to remember, that communication is a two way process!

[dippyhippy]

Flam, you said,

 

"There was no way of responding to your question that would make Cllr Morgan look good."

 

And therein lies the problem! Its all about self promotion. If she could have made it sound as if there was a solution/answer, she would have happily got a minion to tippy tap a response.

 

I can't help it. I don't like the woman. I still think she should have resigned. I shall not be changing my opinion.

 

PS....I tried to quote you using the quote press thingy, but it doesn't seem to want to show up in the comment box, so I have typed in what you said.....I'm pressing "post" now, it might just be that your quote will appear about three times!!!

[megilleland]

Herefordshire Council scrutiny committee draws a line under Hereford Futures

 

Hereford Times website 3:25pm Monday 10th March 2014 in News By Bill Tanner

 

HEREFORDSHIRE Council’s overview and scrutiny committee will not be making any further investigations into Hereford Futures.

 

Committee chairman Councillor Alan Seldon said a line had now  been drawn over issues around the “arm’s length†company.

 

A tacit acceptance at this morning’s scrutiny meeting that things “could have been done better† over the company’s creation and operation meant there was no further part for scrutiny to play, said Coun Seldon.

 

The acceptance – in relation to transparency over the use of public money and the involvement of councillors on the Hereford Futures board – came from councillors John Jarvis and Adrian Blackshaw, both of whom had significant roles in relation to the company.

 

“We are now a lot further forward over the governance of arm’s length companies in future,†said Coun Seldon.

 

That future, the meeting resolved, would give the council’s audit and co-operate governance committee a greater say over “arm’s length†companies.

 

Scrutiny, said Coun Seldon, would now turn its attention to a joint task and project examining the workings of the Marches Local Enterprise Board.

 

In that, he said, Herefordshire Council would work with Shropshire Council and Telford & Wrekin Council.

 

This week the Hereford Times confirmed that Herefordshire Council has paid out nearly £3m in financial support to Hereford Futures Ltd (HFL) over the past 11 years and was now in talks about taking on the liabilities of the company that it wound up in April last year.

 

For more see Herefordtimes.com and this week’s Hereford Times.

 

Wasn't Jarvis on the board of Marches LEP? Seems to have disappeared now. Just found this link to confirm he was. His biography on this site says:

 

Councillor John Jarvis 

Leader of Herefordshire Council 

 

John Jarvis was born in The Marches and his wife, Jenny, was born in Glamorgan, South Wales. In 2004 they returned close to their roots and set up a home and a business in Whitchurch. 

 

John has been a Metropolitan Police Officer, run a catering business, and had a senior role as Divisional Director of Operations in Grand Metropolitan plc. He has also worked for the European Bank for Reconstruction and Development (EBRD) advising companies in Eastern Europe after the fall of the Berlin Wall. 

 

John has been involved in local politics for over 20 years. He has served as a Parish Council Chairman and was firstly elected a Ward Councillor in Essex in 1997. He has represented Kerne Bridge on Herefordshire Council since 2006. 

 

In the last four years he has held the position of Cabinet Member for Environment and Strategic Housing. 

 

John was appointed Leader of Herefordshire Council in May 2011. 

 

Does this explain the link to Herefordshire Council courting Ukraine and Georgia to come to Hereford Enterprise Zone to build aeroplanes or was it drones for the USA?

[twowheelsgood]

I'm sure they were falling over themselves to draw a line over/under it - too may awkward questions to answer otherwise. Disgraceful.

 

Yes, Jarvis was on the board of Marches LEP when he was Chair of the Council. I emailed LEP months ago to point out he was no longer Chair - they replied they were too short staffed to update the site.

[gdj]

I hope it's ok to cut an paste an entire letter - but Cllr Harvey posted on the HT story last night - the story is now well down the page so you may not notice but it is very illuminating.     So thank you to Cllr Harvey for the detail and for taking the trouble to communicate with the public again.

 

 

 

The excellent leader in this week's HT sums up the nasty situation we are faced with quite nicely. We have a company which has been set up expressly to implement council policy on economic development, which has been funded pretty much entirely with public money since its creation.

This company's articles of association stipulate that only people holding specific roles on the council should be members and directors, and that those people should only hold office in the company for as long as they sit in those positions on the council. Their positions in the company are without salary.

However, scrutiny is told that for as long as these people hold positions in HF it is their duty to act in the interests of the company over their duty to act in the interests of the council which pays them a wage or an allowance and which is the only body to task HF to do anything that it does.

The current Chief Executive of the council refused to take up his designated position on the HF board when he joined the council. The current council leader resigned his position on the board in January.

Despite HF having been funded solely by public money, it is not obliged to make public the minutes of its board meetings. No minutes are available to scrutiny or to councillors and we are told that none are held by current or previous council leaders so they are beyond the reach of FOI requests.

In January last year in answer to a written question from Cllr Anthony Powers, we were assured by Cllr Phillips that Hereford Futures would be publishing all its board minutes from now on - this has not happened. The HF website contains no minutes from that date forward, and it is difficult to imagine that the company could have spent a further £355k of council money in 2013-14 without the board having met at any point throughout the year.

We are told that in May 2013 the current Chief Executive guaranteed that no more than £695k of funding would be provided by the council to HF to complete its projects and wind-up the company. On Monday we were told that directors estimate that the company has no more than £525k of outstanding liabilities.

We have an ugly retail development on the cattle market site which some people think is a good idea. We have a flood alleviation scheme which works some of the time. We have some planning permissions outlined for a link road which will see yet more businesses in the city bull-dozed to deliver, and the council has failed to get government funding to build the road so we shall be paying for it from our council tax for the next 30 years.

Some of us battled long and hard to have a different outcome, but that's all history now. The 'deals' are done, the borrowing sewn up, the tenants poached, the compulsory purchase orders drafted. We can't turn the clock back on any of this - but we can do our very best to see that the mistakes, which are starting to be admitted were made, don't get repeated and that lessons are learned for the future.

While HF is being wound-up we must keep cool heads and make sure that, as the Local Enterprise Partnership (LEP) rears up out of the Marches ooze, we don't see shadows of HF reflected in its shiny Skylon scales.

Audit and Governance have been asked by scrutiny to capture the lessons during the HF wind-up (?!?!) and Herefordshire council's scrutiny committee will be doing a joint piece of work with Shropshire, Telford and the Wrekin councils' scrutiny committees to ensure the governance and public accountability of the LEP is all that it should be.

Clearly the HF episode is frustrating - and we all feel that many things are still left unsaid ... but please be assured that the lose ends are being brought together, questions are still to be answered on some key issues and we are determined to ensure we all do better next time. Whoever is in charge.

[dippyhippy]

Good ol' Liz!

She really says it how it is! I have a lot of time for her - I wish she would sign up on here!

She has also written another letter, which I have left a comment on, this week.

If anybody has the inclination to cut and stick that one, its also worth reading.

[gdj]

So the "Council" has not been officially sent minutes of Hereford Futures Board meetings.  However Councillors who sat on the board over the last few years must have copies of the board meeting documents for the meetings that they attended.  Is Cllr Harvey saying that these individuals are refusing to provide copies to the Council whom they represented on the Board?  If so, perhaps someone can name names - call them out.

 

Also, if they claim that they are only obliged to work for the benefit of the company, not the council, when engaged on its business is this an admission that the interests of HF and HCC are not compatible?

 

The FoI act seems to say that HF doesn't have to release documents into the public domain.   It doesn't say that they must not release them.  There is a choice here.  There is also leverage in the council (i.e. us) funding the winding up costs, pensions and pay offs only in return for full transparency over HF's operations over the years.   If `lessons are to be learned`, then facts must be available.

[dippyhippy]

Well, John Jarvis is one. We had a lengthy discussion a while back over at HT, over his wearing of two hats!

He didn't seem to think there was a problem at all....many of us thought differently.

[megilleland]

MEETING: CABINET 

MEETING DATE: 10 APRIL 2014 

TITLE OF REPORT: CLOSEDOWN OF HEREFORD FUTURES 

REPORT BY: ECONOMIC DEVELOPMENT MANAGER

 

item 7.

CLOSEDOWN OF HEREFORD FUTURES

To obtain approval to the arrangements put in place to accomplish the close down of Hereford Futures Ltd (HFL) on a solvent basis and to manage the effective operation of ongoing projects.

 

Recommendations 

THAT: 

a) the transfer of HFL obligations to Herefordshire Council (as outlined at paragraph 6 below) be approved; 

 

b) delegated authority be given to the Director for Economy, Communities and Corporate, in consultation with the Solicitor to the Council, to finalise and sign the necessary documentation to effect the transfer of obligations arising from recommendation a) above, including any necessary variation to the joint venture agreement with Homes and Communities Agency; and 

 

c) the role and efforts of HFL board members throughout the board’s period of operation is recognised and thanks be extended to the board.

 

Reasons for Recommendations 

2. Following the close down of Hereford Futures Ltd there will be a number of outstanding obligations which will need to be continued to ensure the smooth operation of a number of projects which contribute significantly to the council’s corporate plan. Additionally there will be ongoing financial, legal and operational implications of continuing with the projects, these will need to be managed and brought back to Cabinet or Cabinet Member as and when a decision is required. 

 

I wonder if there are any golden hand shakes or enhanced pensions being given out for any HFL board members on their departure?

[twowheelsgood]

Blurring of public and private continues - I'm baffled as to why or how the council think they can close down a private limited company - only the directors (or administrator) can do that. We might ask why we are having to pay for all this work to be done when it is the responsibility of Futiles.

 

As to the two hats issue, I now understand that neither Johnson nor Neill took up their director positions at Futiles - I wonder why.