Agenda item

Cannock Road Housing Development- Budget Amendment and Procurement Strategy

Decision:

RESOLVED

 

KEY DECISION

 

That the Executive recommended that Full Council

 

a)    Approves that the budget for the Cannock Road project be increased to £1,490,000

 

That the Executive

 

b)    Approved the proposal to procure the project via a competitive open tender

 

c)    Delegated authority to the Executive Member for Housing, Communities and Levelling Up in consultation with the Executive Director for Adults Communities and Wellbeing to take any decisions necessary to complete the project without the need to return to Executive.

 

 

Reasons for Recommendations:

 

·         To enable the delivery of the Cannock Road development, which has been paused since May 2021 and ongoing since 2018.

·         To bring a redundant brownfield site in a residential area, which is currently partly demolished, back into use.

·         To increase the supply of affordable rented housing available in North Northamptonshire, which meets the corporate objective of enabling safe and thriving places.

·         To increase the supply of housing suitable for disabled people, which meets the corporate objective of helping people to live healthier, more active and fulfilled lives in North Northamptonshire.

 

Alternative Options Considered-

 

·         Do nothing- this was discounted because it would not deliver any of the objectives set by the Council and would not deliver additional housing.

·         Cease the development and sell the site- this was discounted because the site is required by the Council to deliver its existing programme of housing development, increase the supply of affordable housing and housing suitable for people with disabilities and enable spend of Right to Buy Receipts, which would otherwise have to be returned to the Government.

·         Further pause the development and redesign the scheme to achieve lower per unit costs/increase rental income- this was discounted because it would not allow the provision of additional housing suitable for disabled people and would deny Family A the only feasible option of suitable housing. Family A were allocated this property in 2018 and have been waiting for the development to be delivered since that time. It would also require the project to be restarted as a new planning application would be required and all spend to date would be abortive cost.

 

Minutes:

The Chair invited Cllr Jean Addison to address the Executive. Cllr Addison spoke briefly to enquire as to when development on the stalled Cannock Road Housing Development would recommence.

 

The Chair then asked Cllr Matthew Binley, the Executive Member for Housing, Communities and Levelling Up to introduce a report which sought approval to amend the project budget for the Cannock Road, Corby housing development following a full review of the project, cost plan and risk register. The report also sought approval to procure a principal contractor via an open tender process as well as to delegate authority to the Executive Member for Housing, Communities and Levelling-up, in consultation with the Executive Director for Adults Communities and Wellbeing, to take any further decisions/actions to deliver the project.

 

Cllr Binley stated that the Cannock Road housing development was a scheme to convert a vacant commercial building into five new council homes in Corby specially designed to be accessible for disabled people, including a three bed home specifically designed for a family in need to be owned, managed, and maintained by the Council as part of its portfolio of Housing Revenue Account properties. The capital costs of the project would be covered over the longer-term by the rental income collected from the completed properties once occupied.

 

Following approval for the scheme from Corby Borough Council in 2019 and a contract awarded in 2020 for the construction of the homes, the appointed contractor had been liquidated in May 2021 resulting in a partly demolished building with no principal contractor to deliver the project. A full review of the project including an updated cost plan had identified that a budget of £1.49m would be required to deliver the project, with 40% of this funded from Right to Buy receipts. Due to the increase in the budget a full open tender process should be undertaken to allow a larger number of contractors and ensure that value for money was achieved.

 

It was anticipated that the technical design and award of contract would take approximately 20 weeks, with a further 52 week build programme assumed, although an exact programme was to be agreed during the contract award process. It was hoped that work could start on site in early 2023. It was noted that once complete, the development would increase the Council’s supply of affordable and disability-accessible properties which would be exempt from the Right to Buy scheme to ensure this housing was retained to meet needs.

 

The Chair noted that Council was being requested to approve the budget virement element of the recommendations with Executive to approve recommendations b) and c).

 

Councillors Brackenbury and Howell spoke to welcome the recommencement of the development, understanding the reasoning behind the escalated costs from the originally approved contract. Councillors Howes and Pentland welcomed the positive environmental credentials of the proposed development.

 

RESOLVED

 

KEY DECISION

 

That the Executive recommended that Full Council

 

a)    Approves that the budget for the Cannock Road project be increased to £1,490,000

 

That the Executive

 

b)    Approved the proposal to procure the project via a competitive open tender

 

c)    Delegated authority to the Executive Member for Housing, Communities and Levelling Up in consultation with the Executive Director for Adults Communities and Wellbeing to take any decisions necessary to complete the project without the need to return to Executive.

 

 

Reasons for Recommendations:

 

·         To enable the delivery of the Cannock Road development, which has been paused since May 2021 and ongoing since 2018.

·         To bring a redundant brownfield site in a residential area, which is currently partly demolished, back into use.

·         To increase the supply of affordable rented housing available in North Northamptonshire, which meets the corporate objective of enabling safe and thriving places.

·         To increase the supply of housing suitable for disabled people, which meets the corporate objective of helping people to live healthier, more active and fulfilled lives in North Northamptonshire.

 

Alternative Options Considered-

 

·         Do nothing- this was discounted because it would not deliver any of the objectives set by the Council and would not deliver additional housing.

·         Cease the development and sell the site- this was discounted because the site is required by the Council to deliver its existing programme of housing development, increase the supply of affordable housing and housing suitable for people with disabilities and enable spend of Right to Buy Receipts, which would otherwise have to be returned to the Government.

·         Further pause the development and redesign the scheme to achieve lower per unit costs/increase rental income- this was discounted because it would not allow the provision of additional housing suitable for disabled people and would deny Family A the only feasible option of suitable housing. Family A were allocated this property in 2018 and have been waiting for the development to be delivered since that time. It would also require the project to be restarted as a new planning application would be required and all spend to date would be abortive cost.

 

Supporting documents: