Agenda item

(To receive a report from the Executive Director of Finance and Public Protection, which seeks the Executive's approval for the establishment of a Holding Company limited by shares and 100% owned by the County Council)

(1)  That the establishment of a Holding Company limited by shares and 100% owned by the County Council be approved.

(2)  That the Holding Company be named Lincolnshire Future Limited.  

(3)  That the Executive Director for Finance and Public Protection, in consultation with the Leader of the Council and Executive Councillor for Resources and Communications, be delegated authority to complete all legal matters to enable the company to be established, including approval of the final form of all necessary legal documentation and the appointment of Directors and the Council's member representative.

(4)  That approval be given to the development of a detailed business case to establish the first company beneath the Holding Company for the development of specialist housing in Lincolnshire to support adult care.

Consideration was given to a report from Pete Moore (Executive Director of Finance and Public Protection), which proposed that the County Council established a Holding Company limited by shares, and 100% owned by the County Council. 

The County Property Officer presented the report and in doing so advised that the establishment of a Holding Company by the Council would create a flexible framework for the establishment of subsidiary companies to enable the Council to create a set of different companies depending on the need and purpose, which would support the Council in taking up opportunities to act more commercially. 

It was proposed that a business case was developed for the first subsidiary company to be established to deliver specialist housing for alleviating budgetary pressures in respect of the provision of adult care.

It was advised that there was a requirement to name the Holding Company and the following names were currently available at Companies House:

(a)  Lincolnshire Grow Limited;

(b)  The New Lincolnshire Company;

(c)  Lincolnshire Future Limited; and

(d)  Lincolnshire First Limited.

The Chairman of the Overview and Scrutiny Management Board advised that the meeting of the Board scheduled for 1 March 2018 had been cancelled, owing to adverse weather conditions.  However, members of the Board had been contacted for their comments on the Executive's report on the Establishment of a Holding Company. 

It was noted that a member had sought clarity on what the Holding Company would be used for; more detail had been requested on the reporting mechanisms within the County Council for the Holding Company; caution had been expressed on the potential financial risks to the Council if the Holding Company was to 'overstep its bounds'; and Dynamic Lincolnshire was suggested as another possible name for the Holding Company.

Members were provided with an opportunity to ask questions, where the following points were noted: -

·         The establishment of any subsidiary companies would be approved by the Executive.  Regular performance reports would be presented to the Overview and Scrutiny Management Board and the Executive.  It was requested that reporting was undertaken on a quarterly basis;

·         The benefit of establishing a Holding Company was that there would be a consistency in governance across all the companies, which would be established through the adoption of the Holding Company's Articles of Association and a common Shareholders' Agreement in most instances.  This would streamline the establishment of future companies;

·         It was confirmed that the Council's Teckal company (Transport Connect Ltd) could be transferred under the management of the Holding Company.  However, this would result in the ownership of Transport Connect Ltd being transferred from the Council to the Holding Company.  It was suggested that this could be explored further at a later date.

NOTE: At this stage in the proceedings, Richard Wills (Head of Paid Service) declared an interest as the Chairman of the County Council's Teckal company, Transport Connect Ltd.

·         Future subsidiary companies of the Holding Company would be controlled by the Holding Company, which would in turn be controlled by the Council.  As a result, the Council need only exercise its powers as a member in relation to the Holding Company, thereby reducing the bureaucracy that would be involved in directly managing a number of separate companies;

·         The benefits of establishing a Holding Company were recognised and the formation of a business case for the delivery of specialist housing for alleviating budgetary pressures in respect of the provision of adult care was supported.

RESOLVED

(1)  That the establishment of a Holding Company limited by shares and 100% owned by the County Council be approved.

(2)  That the Holding Company be named Lincolnshire Future Limited.  

(3)  That the Executive Director for Finance and Public Protection, in consultation with the Leader of the Council and Executive Councillor for Resources and Communications, be delegated authority to complete all legal matters to enable the company to be established, including approval of the final form of all necessary legal documentation and the appointment of Directors and the Council's member representative.

(4)  That approval be given to the development of a detailed business case to establish the first company beneath the Holding Company for the development of specialist housing in Lincolnshire to support adult care.