Agenda item

·         Glassworks

·         Serious Economic Downturn in the Local Economy

The Head of Internal Audit, Anti-Fraud and Assurance submitted a report reminding Members that at the meeting in March 2021 it had been agreed that the Committee have a regular opportunity for a ‘deep dive’ of some of the strategic risks with the appropriate Executive Director in attendance to update and assure the Committee on the management of their risks.

Members were further reminded that the Strategic Risk Register contained 13 risks of which 2 had been classified as hight (red rating), 9 risks had been classified as medium (amber) and 2 had been classified as low (green).

All strategic risks had a number of actions identified to minimise/mitigate the risks and all actions had review/completion dates, status updates, progress RAG ratings and identified owners.

The Service Director Regeneration and Culture attended the meeting to provide the Committee with a review of two strategic risks namely:

·         The Glassworks; and

·         Serious Economic Downturn in the Local Economy

The risk register system particularly as it related to these risks was displayed using Power BI software.

The Service Director gave details of the background to both these risks and to why they were included within the Strategic Risk Register.  She outlined the other risk factors that had been identified that underpinned the Strategic Risks and detailed the actions taken to track and manage those risks making particular reference to the departments and agencies involved and the arrangements that were in place to support the service and manage the risks.

In relation to the Glassworks it was noted that this was a key strategic investment for the Council and there was, therefore, a need to ensure the successful delivery of the project.  There were clear financial and reputational implications should the project not be delivered on time, to budget and fail to have the intended economic and social outcomes.  It was noted that the impact of the Covid pandemic had exacerbated the challenges to the High Street/town centre retail sector which was having an impact on the uptake of retail lettings. 

·         Information was provided on the progress in addressing the risks encountered and the mitigating factors that had been put in place to address those issues

·         The construction phase had been mitigated and managed well

·         Information was provided about the impact of Covid on lettings and the retail sector in general

·         It was pleasing to report, however, that the Glassworks Square and several retail units had been successfully opened last week and this had generated an increased footfall and sales within the Town Centre.  A pack of information could be provided detailing the initial appraisal of the operation of the first week of operation

·         In relation to the assurance regarding the effectives of the Glassworks Board and the supporting subgroups, progress was classed as ‘green’

·         In managing the risks associated with the Glassworks it was noted that  a number of subgroups had been established and these reported to the Glassworks Board.  Information was provided on their terms of reference, their membership and the work undertaken and proposed.  Particular reference was made to the work of the Leasing, Operational, Finance, Legal, Marketing and Events Sub Groups and it was reported that all had been reviewed to ensure that they were performing appropriately and had the correct membership

·         The risks and risk register were also discussed and tracked by the Glassworks Board and the Board was kept informed of actions taken by the Authority to manage those risks

·         The contract for the Market Gate Bridge had been signed today

In the ensuing discussion particular reference was made to the following:

·         In response to specific questioning, information about footfall currently within the town centre with comparisons to two years ago (before the pandemic) would be provided.  It was noted, however, that in view of the pandemic an initial analysis had indicated footfall to be reasonably healthy and was back to 85% of pre pandemic levels.  This compared to Leeds and Sheffield which were at 65% of pre pandemic levels.  The highest footfall within the region was York which was at 97% and an examination was to be undertaken to establish what arrangements were in place there that could be replicated in Barnsley in order to encourage greater numbers to the Town

·         It was thought that the continuation of home working was having an impact on footfall and the Smart Working Team would be able to provide further information on this, however, as more and more businesses returned to ‘face to face’ working the numbers withing the Town Centre were likely to increase although most organisations were looking towards a hybrid model of working in the future.  It was important, however, to look at ways of encouraging those staff who returned to Barnsley to spend money in the Town and to put money into the local economy

·         Reference was made to the tremendous feedback received from the public and from businesses particularly those who were investigating the possibility of taking on a lease within the Glassworks.  Particular mention was made to the quality of the development and of the public realm areas.  The leasing agents had commented that Barnsley was performing really strongly in the marketplace

The Service Director then commented on the action relating to assurances of the Glassworks leasing and intelligence around the retail sector to influence lettings.  Progress against this action was classed as ‘green’.  This work was largely undertaken and delivered via the Leasing Sub Group.  Particular reference was made in this respect to the discussions held with the leasing agents, to target and timeline to the end of the year, to discussions with those in the retail, leisure and hospitality sectors and to research undertaken about changing trends in those sectors.  Such discussions were influencing letting options/choices and for this reason consultation was being undertaken with public sector type organisations (for example healthcare providers), leisure ‘experience’ operators and ‘social type’ operators who were considering possible leasing options.

The action in relation to robust and timely financial monitoring and reporting, was managed via the Finance Subgroup.  Progress against this action was classed as ‘green’.  The way in which invoicing was managed was outlined.  The Glassworks was still on budget.  Arising out of this, the Service Director Finance commented that there had not been that much movement against the budget over the last couple of years which gave confidence and assurance that matters were appropriately managed.  Any changes that there had been, for example on construction, related to the changes occurring within the retail sector.  The Service Director Regeneration and Culture briefly made comment to the Cabinet report in relation to changing the arrangements for capital contributions and to the arrangements in place to raise additional capital contribution funding from the Sheffield City Region.  Further information on the arrangements in place could be provided.  Reference was also made to incentives in place to encourage businesses to take up occupation of the Glassworks.

The progress against the action associated with the agreed Centre Management Plan for the effective management of the Glassworks and for the recruitment of an experienced Centre Management Team with prior experience of operating similar centres was classed as ‘amber’ and the reasons for this were outlined.  The Team would comprise 5 members within the Property and Assets Team and details of their respective roles was outlined.  The Centre Manager came into post on the 18^th October, 2021 and the Operations Manager would follow shortly.  The Marketing Manager was already in post.  All other posts should be in place before the end of October.  In addition, a wider group of associates, officers of the Council, were heavily involved in supporting the Management Team.  A third ‘layer’ of support were the sub-contractors who were commissioned to deliver certain services and who also needed to be managed.  To assist in this process a Centre Management Subgroup had been established and the services of a Centre Management Advisor had also been procured to assist in the run up to the opening. 

The opening of the Centre had been extremely successful and whilst a number of minor issues had been encountered, remedial action had been taken to address them.

Information was then provided about the Centre Management Action Plan and how this was reviewed, tracked and monitored.

In response to specific questioning, it was reported that the public realm and all other associated construction works would be completed by December 2022.  The Council owned the Glassworks and Glassworks square and, therefore, had full responsibility for it and its success.  The Glassworks was moving from a construction project to an asset that the Council owned and managed.  The way this was to be undertaken and the transition arrangements in place were outlined.  This would also involve the reorganisation and change of Terms of Reference of the Glassworks Board and its subgroups and Internal Audit would be involved in developing and monitoring those transition arrangements.  The Transition Plan would be submitted to the Board in October and could be shared with Members of this Committee.

In depth information and technical details about the Glassworks would be submitted to the Training/Development session planned for the 13^th October, 2021 or at a future training/awareness session.

The Service Director Regeneration and Culture then commented upon the second strategic risk which related to the potential impact of a serious Economic Downturn in the Local Economy.  It was pleasing to note, however, that this risk had eased somewhat as Barnsley had come out of lockdown whilst recognising there was still a very unpredictable economic environment:

·         Some areas had done better than others during the pandemic. Cannon Hall, for example had been among the top 10 UK most visited attraction which was extraordinary

·         There had been some concern that the collapse of businesses might have added to the pressure on Council and partner services.  Reference was also made to the wider community implications and to increased levels of redundancy as well as the employment prospects for young people and those furthest from the labour market

·         The cessation of the furlough scheme and the implications of changes to Universal Credit were also a concern

·         Particular reference was made to the mitigating actions undertaken by all parties during the pandemic and details of these actions were outlined.  These included, amongst other things, the issuing of grants to businesses and market traders all across the borough.  The work of the Finance Team had been extraordinary in helping to keep businesses afloat

·         A recovery Action Plan had been put in place which outlined a range of interventions the Council and its partners would deliver to support businesses and the retail economy.  Details of the various elements of the Action Plan were outlined but included, amongst other things, assistance with developing digital services and e-commerce

·         An ARG grant programme had been developed to support businesses in Invest to Save initiatives and to help them become more resilient going forwards.  The programme had been delivered by Enterprising Barnsley and the Finance Team.  This had been noted by Sheffield City Region and nationally as being one of the most responsive in the Country in helping businesses throughout the pandemic

·         Reference was made to the work of the Inclusive Economy Board and to the management of the Action Plan.  Reference was also made to the work of the Business and Economy Sub Group and the Tactical Co-ordination Group

·         One of the strands within the Action Plan was to support community and voluntary sector organisation that had been particularly badly hit by the pandemic.  That programme, which was run by an organisation called Mutual Ventures aimed to build capacity and resilience and there were currently 10 organisations across the borough that were benefitting from the programme and were now looking to grow

·         A second action being taken, with the assistance of the Business Intelligence Unit and Team, was in relation to seeking assurance that the necessary performance data and metrics were in place to identify trends and issues and to allow timely and responsive interventions.  It was reported that a whole range of economic performance metrics data was tracked and these were reviewed as part of the Inclusive Economic Recovery Plan.  Information was provided about how this tracking was undertaken and the type of information tracked which included

o   town centre and urban footfall – this provided an understanding of how the high street and businesses were affected by the pandemic impacts

o   payments on business rates and Council Tax – which identified arrears due promptly

·         arising from the above, reference was made to the way in which this data was used, and the help and support offered as a result.  Particular reference was made to the work of the Employment and Skills Team

·         a further action related to the potential impact on the Council in relation to leasing and the collection of Business Rates and Council Tax.  A number of mitigations had been implemented to address these concerns.  It was pleasing to note that the amount of business rates collected had not fallen that much which was really positive and reflected the fact that not many businesses had closed.  There had been a slight dip in collection recently which was probably attributable to the fact that the reliefs that had been issued recently by government had not been quite as generous as the previous year

·         the final action related to the work of the Enterprising Barnsley and the Employment and Skills Teams which were running a plethora of business and employment support programmes.  Work was also continuing with Barnsley College and other providers to ensure that opportunities made available were taken up.  There was a need to ensure that wherever possible jobs within the borough went to Barnsley residents.

In the ensuing discussion, the following matters were highlighted:

·         the work of the Enterprising Barnsley Team was outlined particularly in relation to the way in which data on trends was obtained.  This was particularly important as it meant that interventions could be appropriately targeted

·         Arising out of the above, reference was made to Kick Start Programme which had been evolving as a result of data received.  There were 110 young people to be involved and the scheme had been extended from a 6 month to a 12-month programme

·         There had been an increase in the number of jobs available within Barnsley but it was becoming more challenging matching the unemployed to those jobs.  Nationally there was a trend of people being reluctant to come back out of lockdown into the job market.  The Employment and Skills Team was working hard at stimulating demand.  This issue was highlighted by the Service Director Finance who commented on the increased uptake in Universal Credit and Council Tax claims and to the fact that this had not reduced to reflect people going back into employment

·         Reference was made to the new approach to risk management and the use of Power BI.  After a few technical issues and with the support of the IT Department and staff within Internal Audit, the Service Director Regeneration and Culture stated that the system was really user friendly and gave staff a good tool to be able to identify what key risks were, who risk owners were and how risks were managed.  The Head of Internal Audit, Anti-Fraud and Assurance reported that a post implementation review was to be undertaken and a training module was to be put on the Council’s Intranet site for officers

·         It was reported that there were now 237 risks now logged on the system and more were to be added

RESOLVED:

(i)         that the Risk Register and Strategic Concerns update be noted; and

(ii)        that Kathy McArdle (Service Director Regeneration and Culture) be thanked for attending the meeting and for answering Members questions.