Minutes:
The Committee considered the undernoted report:
“1 Relevant Background Information
1.1 At its meeting of 19th June 2014 the Strategic Policy & Resources Committee Members were updated on a need for the Council to address the need for short-term office accommodation due to additional staff requirements transferring under Local Government Reform (LGR) until new permanent offices are provided under the Council’s longer-term Accommodation Strategy by the end of 2016. Members were advised that a further report would be brought back to Committee in this regard.
1.2 The need to align the additional functions transferring from Central Government and to integrate new staff into the existing Council structure come April 2015 will require a sufficient lead-in time to allow for any reorganisation within existing Council services, complete the leasing-in of any additional office accommodation, undertake fit-outs, prepare desk layouts, install necessary IT etc necessitating the immediate need to secure an appropriate interim accommodation solution.
1.3 Based on what information we have in terms of staff complements involved under LGR it is estimated that there could be a requirement to accommodate in the region of a further 130 staff from April 2015. However, following the previous decision of the Strategic Policy & Resources Committee on 19th June 2014 to approve the commencement of a tendering exercise to procure new build city centre office premises, it will be approximately 1¾ years before these new Council offices are ready for occupation.
1.4 In addition to considering the co-location of transferring staff within the Council’s existing office estate there is potential for some Central Government staff to continue occupation in their existing accommodation. However there remains an identified need to procure additional office space within the city centre close to existing Council offices.
2 Key Issues
2.1 Details provided for those property assets transferring from Lisburn and Castlereagh together with comparatively accurate identification of associated staff complements both within these assets and serving the extended boundary (community centres, parks, refuse collectors etc) has enabled a fairly precise assessment of accommodation needs for staff transferring from these two Councils – many of these staff have no office accommodation requirement as they will remain within transferring assets such as community centres. However, there remains uncertainty around staff numbers and assets associated with the functions transferring from Central Government.
2.2 Detail on the number of Central Government transferring staff, or equivalent staff recruitment, is not clear at this stage but it is estimated, together with staff transferring from Lisburn and Castlereagh councils, that the total number of staff requiring office space in the city centre will be in the region of 130. Based on this assessment of additional staff numbers there is a latent requirement for a minimum of 17,000 sq ft of office accommodation. This estimation of office space does not take account of any specific space requirements such as storage capacity and public meeting rooms for Planning Service.
2.3 Currently there is no capacity within the Council’s existing city centre office estate to accommodate the numbers of additional staff transferring. This is particularly so with the pressure of staff decanting recently from the Waterfront Hall into Seymour House and the potential of further displaced staff from City Hall if/when work on the new exhibition space commences with potentially other decants emanating from a wider review of the use of City Hall.
2.4 Over the course of discussions with Central Government it has become evident that there is no coherent approach to accommodation requirements beyond the end of March 2015 with the Lease of Laganview House expiring and not being renewed (NIHE, HMOs); in Bedford House (Planning Service) one floor surrendered and one Lease extended without any prior consultation with the Council (only until August 2016) and no clarity around the existing DSD accommodation in Oxford House which may or may not become available to the Council. Despite officers seeking clarity the picture therefore remains unclear in respect of both transferring staff numbers and what, if any, office accommodation might be available
2.5 At a regional level discussions are continuing between DOE and DFP in relation to a policy position and potential transfer of funding in relation to the increased costs to Councils of additional accommodation requirements resulting from LGR transferring staff and functions. DOE initial proposals have just been received in respect of high level funding/leasing policy proposals for accommodation, in addition DFP assessments of relevant support costs were also included in order to clarify issues highlighted by the Deloitte due diligence report on Transferring Functions, however these proposals require further clarification. Given the tight time constraints to have accommodation ready for occupation this process needs to commence as soon as possible.
2.6 In addition to identifying the office accommodation currently utilised by Central Government (all held under lease – such as Bedford House) that may transfer with the new functions the possibility of utilising other parts of the NICS city centre office estate have also been explored with DFP and SIB. However, other than currently surplus Longbridge House in Waring Street (c 19,500 sq ft) which is part of the NI Civil Service office estate, we have been advised that there is nothing else that would be made available to the Council by Central Government – any such occupation would however be subject to the Council paying a market rent and meeting all other outgoings.
2.7 To summarise therefore there is minimal space available within the Council’s existing city centre office estate, uncertainty regarding the transfer of a limited amount of office space with transferring functions from Central Government and no alternative office space being made available from within the NICS office estate. This means that the Council need to source additional alternative office accommodation in close proximity to existing Council offices in Cecil Ward Building/Adelaide Exchange of sufficient capacity to accommodate the anticipated increasing staff numbers, provide for any prior decants that will assist assimilation with existing Council services and staff and be sufficiently flexible to cope with any new emerging structure of the Council prior to completion of the Accommodation Strategy.
2.8 An initial site search has been undertaken to identify suitable office accommodation in the private sector currently available to lease within the target location. This search has revealed a limited supply of appropriate scale of office accommodation and of sufficient quality that Landlord’s are willing to let on a short-term basis (approx 2 ½ years from September 2014 to December 2016 – after which time the Council’s permanent office solution should be in place)
2.9 In addition to the above requirement it is proposed that the Planning Service, located in approx 10,000 sq ft Bedford House, and who occupy under a short-term extension to their original Lease remain in situ after April 2015 given the specific requirements of this function – dedicated IT infrastructure for the Planning Portal which serves the entire Province with daily public access/meeting room requirement. However, the tenure renewal negotiated by DFP would expire in August 2016 therefore a longer term extension until December 2016 will have to be negotiated and agreed.
2.10 Specific occupational requirements for new functions such as storage (may be contracted out) and car parking provision will need to be scoped to ensure we plan sufficient provision. For example our HR has been indentifying transferring staff with essential car user designation; Planning Service has a significant off-site storage contract which may be replicated for DSD filing. Whilst both storage and car parking can be dealt with separately there is need for an integrated approach to be taken.
2.11 To facilitate any required co-location of the new functions and transferring staff into the Council’s existing city centre office buildings (City Hall, Cecil Ward Building, Adelaide Exchange, Lanyon Place) there is an immediate need to lease additional office accommodation now in order to plan decants of existing Council staff and undertake necessary fit-outs, installation of IT infrastructure etc.
3 Resource Implications
3.1 Finance
It was agreed in November 2011 by the NI Executive that the cost of transferring functions to local government was to be cost neutral to the rate payer at the point of transfer and it is based on this principle that negotiations on transferring budgets will need to be progressed with DOE to try and agree an appropriate funding model that includes accommodation costs arising from LGR.
Irrespective of how these costs will ultimately be funded by DOE the Council will have to fund in the interim:
- Occupational costs – rent, service charge, rates, insurance
- Annual running cots – light, heat etc
- Fit-out costs/reinstatement obligations
- Decant costs
As referenced above, further specific discussions will be required with DOE regarding the funding proposals.
3.2 Assets
There will be an additional property asset to manage in the short-term in terms of facilities and lease management. In addition to day-to-day repair obligations there may be a dilapidation obligation at the end of the lease term to reinstate the premises.
3.3 Human Resources
Staff Resource, primarily from Property & Projects and Legal Services to lease, fit-out and decant staff as appropriate with ongoing Facilities and Estates lease management responsibilities
4 Equality and Good Relations Considerations
4.1 The longer term delivery of the Councils Corporate Accommodation Strategy will take account of equality issues.
5 Recommendations
5.1 Members are requested to note work undertaken in respect of addressing the interim office requirement arising from the transfer of additional staff under LGR and in order to manage the immediate requirements, and until such time as the Council’s longer-term accommodation solution is delivered, to:
(i) approve the leasing of additional office space (for a short term) in close proximity to the Council’s existing city centre accommodation, subject to terms agreed by Legal Services and Estates Management Unit;
(ii) agree in the short term to the Planning Service staff remaining in their existing accommodation in Bedford House, subject to terms agreed by Legal Services and Estates Management Unit.”
The Committee adopted the recommendations and agreed to delegate authority to the Director of Finance and Resources, in consultation with the Accommodation Steering Group, to approve expenditure of up to £250,000 for accommodation purposes.
Supporting documents: