Agenda item

The Chair announced that she had agreed to Victor da Cunha, Group Chief Executive and Louise Swain, Executive Director for Customer Services of Curo  addressing the Panel regarding their proposed structure and constitutional changes.

Mr da Cunha gave a presentation to the Panel, a summary is set out below.

Integrating our Housing Associations

To bring together our three asset owning landlord functions to:

•  Harmonise and improve our landlord service offer;

•  Reduce complexity, costs and duplication and allow us to secure £3.8m savings over the next five years;

•  Simplify the regulatory burden.

Resident Scrutiny and Accountability

1. New HCA regulatory framework published April;
2. Emphasis on “co-regulation” and greater role for independent resident scrutiny;
3. Curo’s Resident Scrutiny Panel in place;
4. New Resident Involvement Framework approved in June;
5. Increasing focus on local accountability; and

Constitutional changes needed

•  Independent review of governance in 2011;

•  Outstanding constitutional recommendations;

•  Move to industry normal rules;

•  Industrial and Provident Society standard;

•  Review B&NES right to nominate onto the Board; and

•  B&NES class voting rights.

Observing good governance

The Board must ensure:

•  It has the right mix of skills and experience necessary to enable it to achieve its objectives and plans.

•  All Board members have the same legal status and equal responsibility for decision making.

•  Each member acts only in the best interests of the organisation and not on behalf of any constituency or interest group.

•  That Board members are appraised, assessed and demonstrably fulfil their duties and code of conduct.

•  No more than 12 members and no less than 5 members.

Tension in current arrangements

•  Once appointed, the successful Cllr has the same fiduciary duty as all the other board members and:

•  is not able to exercise influence on behalf of any external party;

•  cannot divulge any sensitive information; and

•  must always act in the best interest of Curo.

•  Current B&NES nominee is not given the “same legal status” as other Board members, as they are not able to receive a share or vote at AGM’s.

•  Once appointed, the nominee is not legally able to represent B&NES

Key constitutional proposals

•  Adopt standard I&P rules;

•  “Closed” advertising to Residents for 2 Board positions

•  “Closed” advertising to all 65 eligible B&NES Cllrs for 1 Board position;

•  Once appointed to serve their three year term;

•  No longer referred to as “nominee”;

•  Open advertisement if closed process does not lead to appointment;

•  Adjust the constitution to move from “Class Voting Rights” to “one shareholder, one vote” system.

•  Arrangements enshrined in Standing Orders

Strengthening our strategic partnership

•  Strengthen the role and scope of the current “Strategic Partnership Meeting”;

•  Include housing, employment, health and regeneration;

•  Membership of the Strategic Partnership Meeting is senior members of each political party and Executive Team members from B&NES and Curo.

•  Minutes of meetings shared with other Cllrs to increase transparency.

•  Curo to continue to attend Policy Development and Scrutiny committees and to play and active role in other community initiatives.

The Chair thanked Mr da Cunha for his presentation.

Councillor Les Kew asked what would happen at the conclusion of the three year term for B&NES appointed members of the Board.

Mr da Cunha replied that it would be possible for the member to serve up to nine years in total on the Board and that he would generally expect a continuation of service if all parties were in agreement.

Councillor Les Kew commented that he felt that proposal would be out of step with the Council’s election process as the nominee could lose their seat at an election and yet still remain on the Board.

Mr da Cunha replied that the link to the Council should technically end with their appointment to the Board.

Councillor Les Kew commented that he felt this proposal was unsuitable because as Councillors they have a duty to represent the public.

Mr da Cunha commented that the appointed member would need to show the appropriate skills to take on the role and would therefore be chosen against specific recruitment criteria.

The Chair commented that she was uncomfortable with the use of words such as ‘suitability’ and ‘criteria’ as they hold their current roles by being elected by the public. She asked how the other nine directors would be appointed.

Mr da Cunha replied that an advert would be published and then a very similar recruitment process would take place.

Councillor Steve Hedges commented that he felt that the appointed Council member would surely find it difficult not to represent the public. He asked how the Chair of the Board would be appointed.

Mr da Cunha replied that the role of Chairman is appointed in an entirely separate process and is advertised on that basis. He wished to add that a few pilot schemes were on-going with regard to Local Accountability and that they were being charged with creating Local Plans that would have clear outcomes and timescales.

Councillor Steve Hedges suggested that Councillors should be made aware of these pilots.

Louise Swain replied that Curo were thinking about how they could provide better support to Councillors and a clearer view of their processes.

The Chair advocated the involvement of Town and Parish Councillors also.

Councillor Ian Gilchrist asked if it would be an easy task to find residents who would be willing to sit on the board.

Mr da Cunha replied that they needed to improve communications on this matter to show the worth of the Board and to explain the role they would have on the Board.

Councillor Will Sandry commented that he was not sure if the current objectives of Curo were being met as their latest accounts showed that they have a surplus of £6.6m. He also questioned whether the group was going to be privatised.

Mr da Cunha replied that the group were simply adopting nationally recognised arrangements following the advice given at the conclusion of an independent review. He added that the group remained a Housing Association at heart and was not considering privatisation.

Councillor Will Sandry asked why salaries in excess of £100,000 were not shown in the latest set of accounts.

Mr da Cunha replied that those figures would be shown in this year’s account. He added that membership of the Board had been reduced from 48 members to 12 and that Executive Members had been reduced from 6 to 4. This has resulted in a reduction in the budget of £200,000.

Councillor Will Sandry commented that he had been informed by a local resident of a problem with the contract to the company that fits the kitchens for Somer / Curo. He said that this had resulted in her kitchen not being replaced during the last round of upgrades.

Louise Swain replied by saying that this had occurred as a consequence of their governance procedures. She added that the contract had been terminated as it was unsuitable for the customers of Curo. She wished to however reassure the Panel that the feedback they have had from the public on the new suppliers was positive and asked for Councillor Sandry to inform her of the resident he mentioned in his comments.

Councillor Barry Macrae addressed the Panel. He said that as a member of the Corporate Audit Committee he would welcome a discussion on the matter there as he was worried of the potential ramifications. He also proposed that a legal view be sought.

Councillor Les Kew asked if a resident nominee moves away from the area could they still retain their role on the Board.

Mr da Cunha replied that there would be nothing legally to stop them. He added that they would have to fulfil their obligations as a member of the Board.

The Chair commented that she felt a Board meeting attendance quota should be set. She then summed up the discussion by asking for a report back from the Corporate Audit Committee at the September meeting of the Panel and asked for representatives from Curo to attend to give a further update on the matter and inform them if an Equalities Impact Assessment (EIA) had been carried out regarding the structure and constitutional changes.

The Panel RESOLVED to accept these proposals.