The report of the West Yorkshire Joint Services Director (Document “E”) sets out the background to the proposed establishment of a trading company, with a business case to support that which has already been approved in principle by the West Yorkshire Joint Services Committee and seeks approval for Bradford Council to participate in that company.

Recommended that Executive -

(1)          Notes the legal position as set out in Appendix 1 in particularthat the company will be a controlled company for the purposes of the Local Government and Housing Act 1989

(2)                Notes that the Council provides an indemnity to its appointed representative under the terms of The Local Authorities (Indemnities for Members and Officers) Order 2004"

(3)          Considers and approve the Business Case at Appendix 2 in support of the proposal to trade though the establishment of a trading company;

(4)          Agrees to the formation of a Holding Company  to be limited by shares wholly owned by the founding members of the West Yorkshire Joint Services Committee, i.e. Bradford, Calderdale, Kirklees, Leeds and Wakefield which will protect the business of the West Yorkshire Joint Services Committee, and to 4 subsidiary companies for Materials Testing, Calibration Services, Archaeological Services and Business Hive, to be owned by the Holding Company;

(5)          Agrees to the Council being involved as shareholder in the West Yorkshire Joint Services Trading Company and its’ subsidiaries, on the basis set out in this report;

(6)          Agrees to participate as Directors of the Company on the basis set out in this report;

(7)          Notes and agrees the proposed governance and funding arrangements for the company as set out in the report;         

(8)          Agrees to participate through a shareholders agreement on the terms set out in draft in this report, and authorise the City Solicitorto agree final terms and execute the agreement on behalf of the Council including agreement of the distributions policy which should be on the basis of each Councils contribution rate to West Yorkshire Joint Services;

(9)          Delegates authority to the City Solicitor to agree terms and enter into an agreement with the other 4 constituent authorities to indemnify Wakefield Council against any loss incurred as a result of making a working capital loan to West Yorkshire Joint Services HoldCo up to a value of £1m. The terms of such indemnity to be on the basis of each Councils contribution rate to West Yorkshire Joint Services

(Corporate Overview & Scrutiny Committee)

(Susan Betteridge 0113 3939700)

The report of the West Yorkshire Joint Services Director (Document “E”) set out the background to the proposed establishment of a trading company, with a business case to support that which has already been approved in principle by the West Yorkshire Joint Services Committee and sought approval for Bradford Council to participate in that company.

The West Yorkshire Joint Services Director introduced her report and outlined the services that were delivered on a joint basis to all West Yorkshire local authorities.

The Health and Wellbeing Portfolio Holder explained that over the years West Yorkshire Joint Services had developed and provided services to private companies.  This proposal would provide a vehicle to sell these services more widely and raise more income reducing the cost of West Yorkshire Joint Services in accordance with the budget strategy.

The Joint Services Director added that as public sector finance reduced, Joint Services had generated income with the private sector which supported the budget strategy thereby reducing the costs to the five West Yorkshire Councils.  It was now an appropriate time to set up the trading company based on the legislation available.  Each authority would receive a share of the profits in accordance with the dividend policy.  She added that it cost £9.5m to run West Yorkshire Joint Services, £4.2m came from the 5 West Yorkshire authorities, the remainder from income generation.  The business case was set out in Appendix 2 to Document “E”.  There would be an overall holding company and a number of subsidiaries reflecting the commercial services of Joint Services.  She emphasised that the proposals were not about privatisation.

The Health and Wellbeing Portfolio Holder stressed that by 2020 the local authority would receive no government funding, and it’s only income would be from business rates and council tax and this was a way of protecting local services. 

Resolved -

(1)          That the legal position as set out in Appendix 1 to Document “E” be noted in particularthat the company will be a controlled company for the purposes of the Local Government and Housing Act 1989

(2)                That it be noted that the Council provides an indemnity to its appointed representative under the terms of The Local Authorities (Indemnities for Members and Officers) Order 2004

(3)          That the Business Case at Appendix 2 to Document “E” be considered and approved in support of the proposal to trade though the establishment of a trading company

(4)          That it be agreed to the formation of a Holding Company  to be limited by shares wholly owned by the founding members of the West Yorkshire Joint Services Committee, i.e. Bradford, Calderdale, Kirklees, Leeds and Wakefield which will protect the business of the West Yorkshire Joint Services Committee, and to 4 subsidiary companies for Materials Testing, Calibration Services, Archaeological Services and Business Hive, to be owned by the Holding Company

(5)          That it be agreed that the Council be involved as shareholder in the West Yorkshire Joint Services Trading Company and its’ subsidiaries, on the basis set out in Document “E”

(6)          That it be agreed to participate as Directors of the Company on the basis set out in Document “E”

(7)          That the proposed governance and funding arrangements for the company as set out in Document “E” be noted and agreed   

(8)          That it be agreed to participate through a shareholders agreement on the terms set out in draft in Document “E”, and authorise the City Solicitorto agree final terms and execute the agreement on behalf of the Council including agreement of the distributions policy which should be on the basis of each Councils contribution rate to West Yorkshire Joint Services

(9)          That authority be delegated to the City Solicitor to agree terms and enter into an agreement with the other 4 constituent authorities to indemnify Wakefield Council against any loss incurred as a result of making a working capital loan to West Yorkshire Joint Services HoldCo up to a value of £1m. The terms of such indemnity to be on the basis of each Councils contribution rate to West Yorkshire Joint Services

ACTION: Strategic Director Corporate Services

(Corporate Overview & Scrutiny Committee)