Getting the Trust ready to lease the development


It is important that the Somerleyton Trust is set up to succeed

The work below sets out the proposed stages and structures. This includes a plan for:

  • Recruiting and contracting the right expertise
  • Robust governance, with Lambeth oversight
  • Putting in place all the necessary policies and procedures

Stages

1.       Set up 2.       Interim Assurance Framework 3.       Steady State

 

Completion of stage – Milestones Until 2 months before first completion and tenancy Until at least 1 year after practical completion of the whole site
Duration* 2 years, 7 months (to Nov-18) 3-5 years (2018-2021/23) Remainder of the lease (2023-)
Governance Shadow board (nurturing elected trustees & membership) Elected trustees. Additional Lambeth oversight in the Framework Agreement. Lambeth’s steady state safeguards in the Framework Agreement
Management & functionality ‘Set up’ Project Manager;

Stage 1 business plan

Operations Manager and proportionate staffing +

Appropriate Service Level Agreements;

Stage 2 business plan

Operations Manager and proportionate staffing +

Appropriate service contracts;

Rolling stage 3 business plan

*These are indicative dates

Proposal for Shadow Board to be appointed

The Shadow Board will include appointees to represent the various groups. Gradually as residents and non-residential occupiers move in, their appointed representatives will be replaced with elected representatives.

Expert representatives are vital providing the trust with the skills, knowledge and experience it needs. This will change as the Trust matures. Below is a description of the skills set of the expert representatives at each stage.

Expert Representatives: Skill sets required for Board

  • Stage 1: Set up:
    • Finance & risk
    • Housing management
    • Governance structures
    • Business planning
    • Supply /service agreements
  • Stage 2: Interim Assurance Framework:
    • Finance & risk
    • Housing management
    • Quality Assurance
  • Stage 3: Steady state:
    • Finance & risk
    • Housing management
    • Quality Assurance
    • In 60 years’ time, building renewal expertise may be required.

Managing risks associated with the transition phase

How do we have assurance that the Trust can fulfil its functions in the short term?

   
Assurance framework (0-5 years) Suitable competency and skills in the

·         ‘Set-up’ Board membership

·         ‘On-going’ Board membership

·         Lambeth sign off of business plan

·         Lambeth sign off on tenancy agreements and policies

 

Service Level Agreements Appropriate use of Service Level Agreements with suitable contractors for housing/ asset and facilities management.

 

Recruitment competency Job Descriptions and Competency recruitment for full time Project Manager during set-up stage with particular expertise in:

¡  Previous experience at line manager level of overseeing Housing Officers in the context of social housing;

¡  Preferably experience of managing an estate or community development of similar scale to that proposed;

¡  Experience of projects that enhance community cohesion is desired;

¡  Experience or awareness of the charity sector preferred;

¡  Current or previous local knowledge from Brixton/Lambeth may be desirable.

In addition to “Steady State” safeguards (End Game) ·         Framework agreement

·         Standard market lease

·         S106 obligations

·         Memorandum & articles of association

·         Objectives

·         Business plan sign off

·         Performance reporting

Comparison:  The Trust vs Somerleyton Road being directly held by Council owned Special Purpose Vehicle

The Council will be setting up a new legal body to lease and manage mixed use property assets. It is not uncommon for Lambeth or other councils to set up legal bodies for this purpose e.g. Homes For Lambeth.

A Council owned Special Purpose Vehicle & the Trust both have the following features

 

1.       Both are new legal vehicles set up to lease and manage mixed use property assets.
2.       Both will have their governance and operational structures developed and agreed by Lambeth Council
3.       Both deliver all their income (less operating costs) to the Lambeth.
4.       Both maximize the value derived from public assets for the benefit of the public.
5.       Both are managed and operated in a manner to deliver the Council’s and the community’s objectives.
6.       Both would be faced with similar issues and require similar solutions regarding VAT and their operational structure.
7.       Both provide the same opportunity for the Council to borrow against the future income once the loan has been repaid.
8.       If the Special Purpose Vehicle is able to achieve charitable status, then both would be exempt from business rates and corporation tax.
 

Additional benefits of using the Publicly Accountable Charitable Trust

 

1.       Provision of services and the management of the assets will be directly accountable to the end users (residents etc)
2.       The Trust will be more responsive to the end users in its provision of services and management of the assets.
3.       The direct accountability to the end users may reduce costs and improve the maintenance of the assets.
4.       The local nature of the accountability may encourage a sense of ownership and wider social cohesion.
5.       The objectives of the Trust are being developed in partnership with the community.
6.       The objectives and activities will be overseen by Lambeth, the expert trustees, the compliance organizations (Charities Commission, HCA) and by the membership of the Trust (residents, non-residential occupiers and wider community in the immediate area).

As the comparison shows, the Trust is better able to achieve the project wide objectives.