Agenda item

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The Monitoring Officer explained that the purpose of the report was to place before Members the report to Cabinet in relation to the governance review of the Council’s companies, due to be considered by Cabinet on 15 November 2022.

The Panel’s attention was drawn to the following sections of the report:

·         Appendix 2 – Governance Review Action Plan.

·         Recommendation 1 – Cabinet hereby establishes a sub-committee to be known as ‘the Shareholder Committee’ and sets the terms of reference as shown in Appendix 1 to the report as the terms of reference for the Shareholder Committee.  Cabinet delegates full authority to the Shareholder Committee to carry out its terms of reference. 

·         Terms of Reference – paragraph 3.1 – the following change would be made prior to Cabinet on 15 November:  The Shareholder Committee shall comprise of 3 Cabinet Members to be selected by the Leader on an annual basis to allow flexibility.

The Monitoring Officer responded to comments and questions in relation to:

·         Quorum for Shareholder Committee and flexibility for substitutes.

·         Section 4 - Options considered: Shareholder function, Shareholder Advisory Committee (pros and cons).

·         Council’s preferred option – Shareholder Committee.

·         Role of Shareholder Advisory Committee.

·         Scrutiny opportunities using the Council’s scrutiny procedures /call-in of decisions.

·         Terms of reference to be set by Cabinet not required to be included in Council’s Constitution.

·         Status of Alive Management Ltd.

·         Meetings of the Shareholder Company – documents being available for Councillors to access on Mod Gov, meetings to be held in open session for transparency purposes unless reason identified as to why an item should be considered in exempt session.

The Portfolio Holder for Business, Culture and Heritage highlighted the importance of better governance for Council companies and that advice had been sought from the Monitoring Officer.  The Portfolio Holder added that the majority of comments made by Councillor Morley would be taken on board to allow scrutiny to be undertaken.  In conclusion, the Portfolio Holder advised that the report offered the best way forward for Council owned companies and highlighted the importance of getting this right.  The Portfolio Holder advised that the comments made by the Panel would be taken into account before a decision was taken by Cabinet.

The Leader, Councillor Dark gave some context to the report and explained that Cabinet recognised that there was a need to look at the governance.  Councillors were reminded that for a number of years the legal service was outsourced but was now being brought back in-house together with the Monitoring Officer. The Leader commented that the law and best practice was always evolving and that in reality the report looked across the country at different models in operation, but the option of the Stakeholder Committee had been identified as the preferred option for the Council.

Under Standing Order 34, Councillor Joyce addressed the Panel and outlined the pros and cons of the preferred option and added that there could be a change of Administration in May 2023.

Councillor Morley proposed the following amendment, which was seconded by Councillor Nash but on being put to the vote was lost:

Recommendation 1: 

That the Borough Council shall look at the pros and cons of a form of shareholder involvement and decide whether there should be a Shareholder Committee and/or advisory body made up proportionally to provide advice to the Executive/Portfolio Holder(s) for action.

The Chair thanked the Monitoring Officer for the report.

RESOLVED:  That the Panel supported the recommendations to Cabinet as set out below:

1)            Cabinet hereby establishes a sub-committee to be known as ‘the Shareholder Committee’ and sets the terms of reference as shown in Appendix 1 to the report as the terms of reference for the Shareholder Committee.  Cabinet delegates full authority to the Shareholder Committee to carry out its terms of reference.

2)            Authority is delegated to the Chief Executive in consultation with the Leader to enter Service Level Agreements between the Council and each of its wholly owned companies in respect of all support provided by the Council to that wholly owned company.

3)            The Corporate Governance Action Plan attached at Appendix 2 is approved.