The Chief Executive presented a report which advised Members of the next steps for the above City Deal and sought approval for the formal establishment of the Cardiff Capital Region Joint Committee, which will oversee the region’s economic growth agenda and delivery of the 20 year project. The report also sought approval of the Joint Working Agreement (JWA), Assurance Framework, Implementation Plan and Cardiff’s role as the ‘Accountable Body’ that will enable the establishment of the Cardiff Capital Region City Deal.

 

By way of background information, the Chief Executive reminded Council that on 15 March 2016 each of the ten local authority Leaders, the First Minister of Wales, the Welsh Government Minister for Finance, the Secretary of State for Wales and the Chief Secretary to HM Treasury signed the Cardiff Capital Region (CCR) City Deal Heads of Terms Agreement (Appendix A to the report). This would unlock £1.2b and over its lifetime of 20 years, partners envisaged that the City Deal would deliver up to 25,000 new jobs and leverage an additional £4b of private sector investment.

 

The Chief Executive added that £734m would be allocated to Metro, with £495m covering an Investment Fund to support additional economic development activities. The latter provided the focus of the local government capital contribution of £120m borne by the 10 local authorities, with the remaining £375m provided by the UK government over a 20 year period. He added that the Heads of Terms made clear that further work was needed to conclude the City Deal, particularly in relation to the development of governance arrangements, in order to administer the £1.2b fund.

 

Paragraph 3.9 of the report then advised of the bodies that had been introduced to adequately cover essential governance issues attached to the City Deal. The Chief Executive further added that in addition to these, and in order to discharge the Cardiff Capital Region’s City Deal commitments and implement an ambitious economic strategy in the longer term, the 10 local authorities requested that greater financial autonomy and flexibility should be granted by government, in order to accelerate the delivery of critical infrastructure across the region, at a time of local authority funding restraints.

 

The next section of the report advised that a Programme Management Office has been established, and in addition to this, external legal support was appointed to develop a Joint Working Agreement (Appendix C to the report refers). This will provide the legal framework for the establishment of a Joint Committee for the Cardiff Capital Region.

 

The Chief Executive confirmed that the next step was to formally establish the Regional Cabinet and agree the terms and conditions of the City Deal Investment Fund. There were 3 specific requirements to be met, set by UK and Welsh Governments, namely:-

 

• The transition of the Regional Cabinet out of the “Shadow” arrangements
• Formal approval of the Assurance Framework for the Investment Fund; and
• Formal approval of the Implementation Plan

 

Further details in respect of these were contained in the report and explained at the meeting by the Chief Executive.

 

A Member asked if the cost for support of the Programme Management Office PMO) came from the recurrent budget pressure of £94k, required to fund BCBC’s share of Joint Committee costs.

 

The Chief Executive advised that the support for the PMO was borne proportionately by each of the 10 participating local authorities.

 

A Member stated that he had welcomed the attendance of the Leader of Monmouthshire County Council as well as Vice-Chair of the proposed City Region Cabinet to the last meeting of the Partnerships and Governance Overview & Scrutiny Committee to participate in discussion on the City Deal.

At that meeting he expressed concerns over the joint working of ten very different authorities in terms of the communities they make up, and how they would reach agreement on the portion of the funding that isn't allocated which amounted to near half a billion pounds. At the above meeting, the Leader of Monmouthshire stated that he is only too well aware of the disadvantages facing particularly the valley council areas, and therefore, he for one would be happy to see a project be developed in an area that would have the greatest benefit from it i.e. such as in the valleys, and the Member          hoped that that would be the case.

The lasting or continuing legacy of a project of this kind would in part, be determined by the impact it has on the most disadvantaged people and communities in South Wales, many of which were in Bridgend. He hoped that the already well-connected and well-positioned authorities, such as Cardiff, Newport and the Vale of Glamorgan would not have an advantage over authorities such as Bridgend, though he did note that six of the ten authorities were considered as 'Valley Councils'. Those common challenges that will be faced he felt must be tackled by the common opportunities we share, and he hoped that this was part of the mindset of those sitting on the joint committee.

In his capacity as the joint lead on Regional Transport for the City Deal, he asked the Leader to try and ensure that well-connected transport, and in particular, the development of the metro scheme be introduced as soon as possible. The whole city region concept was built on competitiveness, and nothing could hamper that more than schemes that take months and years to come to fruition whilst ensuring that private sector growth is driven in any region other than ours.

He referred to paragraphs 7.7 and 7.8 on page 27 of the report and the joint working agreement business plan which will require debate amongst the ten local authorities. He asked that the business plan when agreed, be the subject of a further report to both Cabinet and Council for debate and discussion to ensure that elected Members are happy with the vision of how the currently unallocated £495m will be spent going forward, and that it is of maximum benefit to the BCB.

He also hoped that the City Deal will be the subject of scrutiny across the ten authorities, but more importantly by Members of this Authority, to ensure that it continues to be of benefit and delivers for the people and the communities that we represent. He asked whether or not the relevant Overview and Scrutiny Committee will be given the opportunity to view the authority's proposals going forward.

He felt that it was incumbent upon the Joint Committee and on BCBC to ensure that its constituents were as well-informed on the City Deal as possible, whilst being mindful and managing of expectations.

He was aware of the risk involved in taking this project forward, however, he also believed that the greatest risk was in not taking the risk at all and instead opting out of the deal which he supported.

 

A Member referred to paragraph 7.12 of the report and the number of technical and accounting matters, including the finalisation of grant Terms and Conditions. It added that matters such as these needed to be resolved with the Wales Audit Office, and until such time written agreement regarding this was received, the likes of the above would remain as key project risks and any changes that result in an increase to the Affordability Envelope is a matter reserved back to each Council. He asked if it was prudent to sign the Agreement until such time these issues were resolved. He also asked if Brexit would in any way jeopardise the European funding and funding allocated for the metro.

 

The Chief Executive advised that he was reasonably confident that the financial envelope as detailed in the report would be as is and audited effectively. He added however, that if this was to change in any way, then this would be the subject of a further report to Council. He conceded that the Project was as ‘big as they come’, and that due to this there were inevitably risks attached to it. However, he was confident that these would be mitigated by Reserved Matters and the Assurance Framework. With regard to Brexit and European funding, the Chief Executive advised that there was no element of European funding other than for the Metro which would be passed through the UK and then Welsh Government. This funding has to be progressed within a specified timescale, or it would not be able to be accessed.

 

The Leader advised that the report before Members was an important part of the City Deal process.

 

The City Deal could bring about an economic and social step-change in the Cardiff Capital Region, through improved transport, supporting innovation, an improved digital network, developing skills, supporting enterprise and business growth, and through housing development and regeneration.

 

£1.2 billion of investment to increase the performance of the city-region economy. Over its lifetime of 20 years, City Deal will deliver up to 25,000 new jobs and leverage an additional £4 billion of private sector investment.

 

Although not a panacea, he felt that this was a once in a lifetime opportunity. 

 

Wales has seen nothing on this scale before he stated. The critical mass needed to compete internationally can only be achieved through the collective power of 1.5m people working together in a joined up system and sharing in the benefits that brings.  We are committed to the City Deal and we are committed to unlocking the benefits it can bring to our city and our region.

 

Members have asked lots of questions, we have had all member briefings and the opportunity to read all the public Cabinet reports and received regular updates from the Chief Executive.

 

The Leader added, that he was very encouraged that the Partnerships and Governance Overview and Scrutiny Committee dedicated a long and full meeting to an in-depth review of the City Deal and made no recommendations. He believed this represented cross party support for a cross party initiative to secure investment and a step-change.

 

The scale of the opportunity and the strength of the case for the City Deal is reflected in the scale and diversity of the support for the vision across the region, in the Cardiff Capital Region.

 

The Vice Chancellors of each university in South East Wales, Cardiff University, the University of South Wales and the Cardiff Metropolitan University have given their “wholehearted” support to the project.  Professors Aitchison, Riordan Lydon described it as the “most exciting and significant economic investment opportunity for the region in recent history”.

 

Key organisations, representing businesses across the region, CBI Wales, the Federation of Small Business Wales, IOD Wales and South and Mid Wales Chamber of Commerce have all given their support, describing “the critical importance of the deal to the economic future of the region”.

 

The Valley authorities of Torfaen, Merthyr Tydfil, Blaenau Gwent, Rhondda Cynon Taf Councils unanimously voted to back the City Deal last week. The rural authority of Monmouthshire has unanimously backed the City Deal also he confirmed.

 

The City of Newport had overwhelmingly backed the deal.  Even the City of Cardiff authority (an authority not renowned for its cross party consensus) has voted unanimously to back the deal.

 

Labour, Independent, Plaid Cymru, Conservative, Liberal Democrat Councillors have all supported the City Deal, the Leader also added.

 

He was therefore, very proud and very excited that Members had agreed unanimously today for Bridgend to take the next step in the City Deal initiative.

 

The Cabinet Member Education and Regeneration added that the first 40 pages of the report’s Appendix reflected the excellent themes of the City Deal, which ranged from transport improvements, increased housing, and the gaining of education and skills in order for individuals to secure employment. It also contained an example of an excellent International role model such as a similar Deal that took place in Bilbao.

 

The Chief Executive in response to a previous question, advised that further reports would be presented to Cabinet and Council on any financial elements of the Deal. In terms of the Scrutiny process regarding the monitoring of the City Deal, this could be the subject of scrutinising on a regional basis, though this had not yet been fully resolved.

 

The Deputy Leader concluded debate on this item, by advising that the City Deal would be significant whereby common problems would be solved regionally through the ten participating authorities where there would be equal status of one vote per Authority on various projects and schemes, irrespective of the size of the Authority. It was a huge scheme that would make a huge difference to the region involved, and he was sure the authorities involved would ensure that the benefits of the scheme would be optimised. 

 

RESOLVED:               That Council agreed (as did Cabinet) the following in so far as it applies to each of their functions:-

 

1.         Approved the Joint Working Agreement (appendix C) as the legal document that formally establishes the Cardiff Capital Region Joint Committee (the ‘Regional Cabinet’) as a Joint Committee, with delegated functions, with a Commencement Date of the 1^st March 2017. The elected member representative to the Regional Cabinet shall be the Leader of the Council, or his/her nominated Deputy;

 

2.        Approved the financial contributions from each constituent council towards the collective £120m total, (together with such associated costs e.g. carry costs), as detailed in the body of this report;

 

3.        Approved the carry forward of any remaining revenue funds from 2016/2017, contributed by each constituent council, into 2017/2018 in order that the support structure for the Regional Cabinet continues;

 

4.        Approved the collective revenue contributions of up to £1m (inclusive of Recommendation 2.3 above, on a proportional basis as set out in the JWA) to the 2017/2018 budget, in order that the support structure for the Regional Cabinet continues;

 

5.        Approved that the City of Cardiff Council acts as the Accountable Body with the responsibilities as set out in the JWA;

 

6.        Approved the Assurance Framework as the open and transparent, robust decision making process for considering all proposals requiring support from the CCR City Deal Wider Investment Fund;

 

7.        Approved the Implementation Plan in the form attached to the JWA, subject to each constituent council approving the JWA Business Plan;

 

8.        Approved the Chief Executive in consultation with the Leader of the Council, the Corporate Director Operational and Partnership Services and s151 Officer be granted delegated authority to agree such amendments as are necessary to the JWA, Assurance Framework and Implementation Plan (as are appropriate) from the date of acceptance of these recommendations to the Commencement Date of the 1^st March 2017;

 

9.        Approved the Chief Executive in consultation with the Leader of the Council, the Corporate Director Operational and Partnership Services and s151 Officer be granted delegated authority to agree whether the Council should continue to explore the opportunity to continue to participate in the CCR City Deal in the event that one or more of the ten constituent councils fail to agree any of recommendations 8.1 - 8.8 above; and

 

10.       Approved the Leader of the Council or his nominated Deputy be granted delegated authority to sign the JWA on behalf of the Council.