Executive Director/Director Non-Key Executive Decision Report

Author/Lead Officer of Report: Yunus Ahmed, Development Team Manager

Tel: 0114 2735570

Report to: Edward Highfield, Director of City Growth

Date of Decision: 9th March 2020

Subject: Stocksbridge Town Fund –Acceptance of MHCLG £140k for developing the Town Investment Plan

Which Cabinet Member Portfolio does this relate to? Cllr Mazher Iqbal, Cabinet Member for Business & Investment

Which Scrutiny and Policy Development Committee does this relate to? Economic and Environmental Wellbeing Scrutiny and Policy Development Committee

Has an Equality Impact Assessment (EIA) been undertaken? Yes No X

If YES, what EIA reference number has it been given? (Insert reference number)

Does the report contain confidential or exempt information? Yes No X

If YES, give details as to whether the exemption applies to the full report / part of the report and/or appendices and complete below:-

“The (report/appendix) is not for publication because it contains exempt information under Paragraph (insert relevant paragraph number) of Schedule 12A of the Local Government Act 1972 (as amended).”

Purpose of Report: i) To provide the necessary background information regarding receipt of a Government grant of £140,000 from the MHCLG ‘Towns Fund’ towards developing a Town Investment Plan for Stocksbridge. ii) To notify the Director of City Growth that the grant funding is awarded on the basis that the City Council will be acting ‘Lead Council’ and will: a) develop a Town Deal Board – in this case the Stocksbridge Town Deal Board; and then b) develop a Town Investment Plan and supporting Business Case. iii) Under the Towns Fund programme the City Council is required not only to act as ‘Lead Council’ but also to act as Accountable Body. The significance of this is

Form 2a – Officer Non-Key Executive Decision Report July 2016 that should a successful Investment Plan be submitted to MHCLG by Summer 2020 then an award of up to £25 million could follow with the associated governance issues that administering that grant would require. It is imperative that the Council is fully sighted on these implications.

Recommendations:

That the Director of City Growth: a) in consultation with the Head of Strategic Finance, acknowledges the receipt and acceptance of the MHCLG grant of £140,000 in accordance with the terms outlined in the Towns Fund Prospectus . b) approve the expenditure of the above grant via the Stocksbridge Town Deal Board in accordance with the Town Plans Prospectus acknowledging that the City Council will be acting as Accountable Body on behalf of MHCLG; c) grant the funding to the Stocksbridge Town Deal Board, subject to suitable legal and financial arrangements and terms being negotiated to the Council’s satisfaction between the Town Deal Board and the City Council acting as the Accountable Body.

Background Papers: (Insert details of any background papers used in the compilation of the report.)

Lead Officer to complete:-

1 I have consulted the relevant departments Finance: Gillian Brailsford and Peter Carr in respect of any relevant implications indicated on the Statutory and Council Policy Checklist, and comments have Legal: David Cutting been incorporated / additional forms completed / EIA completed, where Equalities: Annemarie Johnston required.

Legal, financial/commercial and equalities implications must be included within the report and the name of the officer consulted must be included above.

2 Lead Officer Name: Job Title: Yunus Ahmed Development Team Manager

Date: 9th March 2020

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1. PROPOSAL

1.1 In March 2019 City Council submitted 3 expressions of interest for , Fargate/High Street and Stocksbridge for Future High Street Funding. In July 2019 MHCLG announced that only Fargate/High Street had been shortlisted along with 50 other areas across to proceed to the next stage. Stocksbridge and Attercliffe were unsuccessful.

1.2 In August 2019 MHCLG announced a further 50 towns would proceed to the second stage with additional funding from the £3.6 billion Towns Fund. Stocksbridge was one of “100 places to benefit from the new Towns Fund” (MHCLG press release on 6th September 2019) and the City Council was invited to “work with the Government to develop innovative regeneration plans”. It is unclear why Stocksbridge was included on the list other than Stocksbridge was unsuccessful in securing Future High Streets Fund support.

1.3 Up to £25M is available from the Towns Fund subject to the successful submission of an Investment Plan and a supporting business case underpinning the Town Investment Plan. This will no doubt be welcome news in view of the recent announcement of job losses at Liberty , based in Stocksbridge.

1.4 As a precursor to this an investment readiness checklist had to be submitted to MHCLG by the 19th December 2019. The City Council coordinated the submission of this checklist in consultation with input from local partners and stakeholders. In order to progress the work a Town Deal Board had been established which includes representatives from the key local stakeholders including a local developer Mark Dransfield of Dransfield Properties who acts as a Joint Chair with local MP Miriam Cates.

1.5 The deadline for submission of the Town Investment Plan and business case is Summer 2020. MHCLG have indicated that successful bids will be announced in 2020-21. The Government has offered £140,000 to fund the preparation of a Town Investment Plan and supporting business case.

1.6 MHCLG has made it clear that the Town Deal Board should support the preparation of the business case in an advisory capacity and be the vehicle through which the vision and strategy for Stocksbridge is defined. However, it is the City Council which has primary responsibility for delivering the Town Investment Plan and business case. It is also Sheffield City Council who are to act as the Accountable Body for both the initial £140,000 capacity funding and for any subsequent award that will be a mixture of capital and revenue funding. The initial £140,000 has already been received by the City Council.

Page 3 of 8 1.7 This report acknowledges the receipt and acceptance of the MHCLG grant and facilitates the preparation of the Town Investment Plan and full business case for submission to MHCLG by Summer 2020. The funds will be used to fund Officer time and specialist consultants.

1.8 There is, however, a need to clarify the nature of the relationship between the Stocksbridge Town Deal Board and the City Council. Whilst the process of achieving clarity regarding this relationship may take some time, it must not be allowed to prevent progress being made on master-planning and related work which will form the basis of the Town Investment Plan and the business case.

1.9 The terms of the grant are far as they go are covered by the Towns Fund prospectus and there is little likelihood of a grant offer letter being received. Any obligations on the Council as Accountable Body regarding use of the funds will be reflected in any grant agreement with Town Deal Board.

1.10 The Town Deal Board has commissioned initial work prior to any formal agreement between the Town Deal Board and SCC. This is at the risk and cost of the Town Deal Board and more specifically their panel of consultants.

2. HOW DOES THIS DECISION CONTRIBUTE ?

2.1 Acceptance of the MHCLG grant will release money to enable the City Council and Stocksbridge Town Deal Board to start work on the preparation of a “vision” for Stocksbridge and in turn the investment plan and the business case. If successful, it will secure up to £25M which will enable transformative regeneration of Stocksbridge, securing new jobs and making the town a desirable destination capitalising on the success of the Fox Valley retail development.

2.2 The key priorities of this initiative are to improve transport links and connectivity between Stocksbridge and the rest of the region, especially ; and undertake improvements of the existing town retail centre and its link to and from the Fox Valley Retail centre.

2.3 The cross cutting themes underlying any plans will include such issues as climate change; improving customer experience; and developing a much improved and sustainable local retail and leisure economy across the town.

2.4 The initial £140,000 is for “capacity funding” (per the letter from MHCLG to SCC and SCR dated 1st November 2019) to “support the convening of the stakeholders, community engagement, research and development proposals”.

Page 4 of 8 3. HAS THERE BEEN ANY CONSULTATION?

3.1 There were consultations at the time of the Future High Street Fund bid and a sketch masterplan was produced for the shopping centre. More recently various stakeholders have been invited and given an opportunity to input into the emerging vision and the final readiness Checklist as required by the Government.

3.2 However there will need to be a fresh public consultation programme given the anticipated scale of spending and opportunities for the town. It is hoped to undertake a “Planning for Real” exercise where local residents will be invited to take part in an interactive consultation programme, facilitated by external consultants to ensure an objective approach. This will be supplemented by gathering of information already collected such as requests for improvements to highways or dealing with difficult sites.

4. RISK ANALYSIS AND IMPLICATIONS OF THE DECISION

4.1 Equality of Opportunity Implications

4.1.1 There are no significant positive or negative differential equality implications arising from the recommendation in this report. The business case development work and potential future capital interventions are anticipated to be of universal positive benefit for all local people, with added benefit from the creation of a significant number of new full and part time jobs. The local socio- economic and community cohesion impacts are anticipated to be particularly positive.

4.1.2 Further equality impact assessments will be carried out to inform the full business case decisions and the decision regarding the key interventions identified for capital funding.

4.2 Financial and Commercial Implications

4.2.1 Subject to an anticipated grant determination letter being received in addition to the Towns Fund prospectus (which appears increasingly unlikely), the key features are (provisionally) summarised as follows:

 The £140,000 capacity funding received from government via a Section 31 grant is to support the development of a Town Deal Board and Investment Plan for Stocksbridge.  It is anticipated that the funding will be used for: - Convening the Town Deal Board - Running business and wider community engagement events Developing the Town Investment Plans - Providing technical expertise for business case development.  The capacity payment is to support and provide internal capacity and staffing for coordination.

Page 5 of 8  The funding is provided as a Section 31 grant, it should also be anticipated that the S151 officer may be asked to complete a statement of grant usage letter at some stage.  SCC monitor progress of the project and confirm that the money is being used in the correct way if it is held by the Board.  The grant funding is awarded in line with the project prospectus and the grant may not be used for activities other than those specified, without the prior consent of MHCLG.  The Legal Agreement is intended to ensure that the capacity funding achieves the desired outcomes.  All Towns to have completed Town Investment Plans by the end of Sumer 2020.  Records are maintained, effective monitoring and financial management systems to control expenditure are operating to ensure that the costs of achieving the objectives, activities and milestones set out in the full business case can be clearly identified.  The Project Manager will need to read, understand and comply with all of the grant terms and conditions and the Code of Conduct for Grant Recipients.

Procurement

4.2.2 All public sector procurement is governed by and must be compliant with both European Legislation (until further notice) and UK National Law. In addition, all procurement undertaken by the City Council must comply with its own Procurement Policies, and Contract Standing Orders’ (CSOs).

4.2.3 The CSO requirements will apply in full to the procurement of services, goods or works funded by the Towns Fund grant. All grant monies must be dealt with in the same way as any other Council monies and any requirement to purchase or acquire services, goods or works must be undertaken by way of a transparent and fair competitive process.

4.3 Legal Implications

Governance

4.3.1 For matters like this Towns Fund initiative the convention under the Leader’s Scheme of Delegation would be that any decision that the Council is to act as Accountable Body for external grant aid is taken by an Officer only with the prior agreement of the Executive Director, Resources or the Head of Strategic Finance.

4.3.2 The Leader’s Scheme goes on to state that if the necessary approval to act as Accountable Body has been given then an Independent Cabinet Member has reserved delegated authority to approve the onward payment of any grant in excess of £50,000.

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4.3.3 During the initial stage of the Towns Deal initiative as described within this report the City Council will work with the TDB to develop an appropriate legal and governance structure as part of the Business Case to provide MHCLG with confidence that a suitable governance structure will be in place should a successful award of £25m be granted.

MHCLG Grant Terms

4.3.4 The Council would conventionally be bound by any terms of grant letter or upstream MHCLG Legal Agreement. In this current scenario the only document containing any conditionality is the Towns Fund Prospectus itself which in essence seeks two conditions. Firstly that the City Council ‘develop’ a TDB by no later than the end of January 2020, and secondly, then to ‘produce’ a Town Investment Plan no later than Summer 2020. There appear to be no specific further conditions and as importantly, no explicit clawback provisions.

4.3.5 Any proposed joint approach where the City Council Members or officers are actively involved in the operational management and decision making of the TDB may lead to conflicts of interest arising and the blurring of the distinct roles – especially regarding the Accountable Body functions. The arrangement that the Towns Fund Prospectus envisages is that the Lead Council (i.e. the City Council) acting as the primary responsible organisation in this arrangement ‘develop’ the TDB (which appears to have been achieved) and then ‘produce’ the Investment Plan. If there are either Elected Members or Officer roles on the TDB then ethical walls would need to be in place to ensure that there was no perception of bias or inappropriate preferential treatment especially in the fiduciary discharge of the Accountable Body function.

4.3.6 The intention is that the Programme and Accountable Body Service within the City Growth (PLACE) is to deliver the Accountable Body role. The activity associated with the Accountable Body role will be resourced from the grant.

4.3.7 There are distinct Accountable Body implications which are dealt with within the Financial Implications section above – these being governed by the Cipfa Local Authority Accountancy Framework and other Cipfa guidance on managing grant funding by local authorities.

4.3.8 The grant of £140,000 has been paid to Sheffield City Council under Section 31 (non-ring-fenced transfer) of the Local Government Finance Act 2003, from the Ministry of Housing, Communities and Local Government (MHCLG), which gives a Minister of the Crown the power to pay a grant to support local authorities towards expenditure lawfully incurred or to be incurred.

4.3.9 The City Council accepts grant funding under section 1 of the

Page 7 of 8 Localism Act 2011 (i.e. the general power of competence). Any grants accepted by the Council should only be received following the process delineated above under Articles 6.2.1 (approval by the Director of Resources / Head of Strategic Finance) and then managed by an Executive Director (or their delegate) under Article 6.2.2 of the Financial Procedure Rules. It is noted that in the current circumstances the acceptance of the grant was something of a fait accompli as the funding was transferred into the Council’s accounts with no forewarning.

4.4 Other Implications

4.4.1 The object of this report is to provide capacity both within the Council and to the TDB to be able to submit the business case to MHCLG in order to access town deal funding by summer 2020. This will assist in the development of a more strategic economic and political relationship between the City Council and Stocksbridge Town Council into the future. There are no other know implications.

5. ALTERNATIVE OPTIONS CONSIDERED

5.1 Do nothing. We could choose not apply for funds or we could choose not to accept nor to progress with the Business case /Investment Plan. That would not be in the best interests of Stocksbridge or Sheffield as areas needing regeneration.

6. REASONS FOR RECOMMENDATIONS

6.1 The original Future High Street Fund application was a Council and Stocksbridge stakeholder joint bid as is the current approach to secure the £25m of New Towns Fund. It represents Council and Stocksbridge Town Council and private sector joint working for the mutual benefit of the Town. This would be a welcome windfall for the City and Stockbridge town and is unlikely to be repeated. It represents the potential for further regeneration of Stocksbridge and is done in full knowledge of the scarcity of funding otherwise available.

6.2 Although some legal and political issues remain to be resolved in view of the specific set of circumstances (e.g., relationship between the Council and Stockbridge Town Deal Board / private sector input), the funding provides an opportunity to address some major entrenched infrastructure challenges for this area and help access significant funding to tackle them.

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