Issue - meetings

Cabinet received a report which advised that the credit crunch that began in 2007 had virtually eliminated the funding traditionally available for growth developments and it was unlikely these funding mechanisms would ever recover to levels seen before. The economic downturn had also created a heightened pressure for economic development and city marketing activities. Over the previous year the Council had been working to ensure its growth delivery arrangements positively adapted to these changes.  A dialogue with capital market specialists had been initiated, who have advised on the in-house processes and arrangements that would be needed to generate investor confidence in the city and on the technical approaches for making a case for them to fund key projects.  The arrangements discussed in the report would combine capital market infrastructure finance expertise with world-class development skills, enabling the growth agenda to continue to be delivered. 

As well as refreshing project delivery arrangements, the changes would also strengthen the commitment to building a strong economic base in the city. These proposals would, through changes to Opportunity Peterborough, enhance the approach to economic growth and development within the city and the wider sub-region, helping to realise the ambition to create conditions for greater levels of entrepreneurship and enterprise.

Members expressed concern at some development which had been permitted outside the city centre and asked for assurances that future developments would be subject to the same stringent planning constraints as city centre developments. There were discussions about the level of progress made by Opportunity Peterborough and the need for a more democratic and politically led approach. Officers have reassurances that delivery would be properly monitored by the Corporate Management Team and reported to Cabinet.

CABINET RESOLVED TO:

   Approve the proposed changes to the growth delivery arrangements set out in the       report.

REASONS

1.  It was likely to be several years before traditional financing opportunities were available again, and these were unlikely to ever be to the same value as before to the downturn.  For Peterborough’s growth agenda to meet its ambitious targets, it had to move forward with innovative finance models.

2.  A specialist capability was needed to access the financial markets in a different way.

3.  There was a greater need for focused economic development activity in the current climate, a function that Opportunity Peterborough was well placed to drive.

ALTERNATIVE OPTIONS

1. A total in-house option was considered, but the expertise needed did not exist within the Council nor could a local authority reasonably be able to recruit such expertise in the future.

2.  A fully externalised growth delivery service was rejected due to prohibitive cost and to ensure control of growth schemes was retained by the Council. 

         3.  The options of continuing ‘as is’ was rejected as it would have                           significantly constrained the medium term growth possible for the city                       compared to the recommended option.