Agenda item

The Scrutiny & Overview Committee is asked review the Cabinet report due to be considered by the Mayor on 25 January 2023 and decide whether it wishes to submit any comments or recommendations on the report for the Mayor to take account of as part of his decision making.

The Committee considered a report set out on pages 17 to 32 of the agenda and an accompanying confidential report on pages 37 to 44 of the same agenda concerning the Whitgift indemnity and Land Transfer Agreement (ILTA) Remedy. The report was due to be considered by the Mayor at the Cabinet meeting on 25 January 2023 and the report had been included on the agenda to give the Committee the opportunity to provide feedback on the recommendations.

The Cabinet Member for Planning & Regeneration, Councillor Jeet Bains, the Corporate Director for Sustainable Communities, Regeneration & Economic Recovery, Nick Hibberd, Director of Planning & Sustainable Regeneration, Heather Cheesbrough and Head of Commercial & Property Law, Kiri Bailey, attended the meeting for this item.

During the introduction to the report the following was noted: -

• The ILTA provided for a remedy under the contract with the Croydon Limited Partnership (CLP) for works to the value of £4m indexed and was not a cash sum.
• The Council was seeking the remedy because CLP had not redeveloped the Whitgift within the time frame specified in the contract.
• The deadline to issue the remedy was 23 Feb 2023. If it was not issued by that date, then CLP would be released from any of its obligations specified in the contract.
• The remedy required CLP to carry out improvements to the North End area of the town centre to the value of £4m indexed. These improvements included work to activate the Alders site, improvements to the Whitgift Mall, the provision of a consultation space to inform the development of a Town Centre Masterplan and connectivity improvements to the town from Wellesley Road.

Following the introduction, the Committee was afforded the opportunity to ask questions on the information provided. The first question asked whether there was a timeline by which the works identified through the remedy had to be delivered. It was advised that although the remedy notice needed to be served by 23 February 2023, conversations continued with CLP about the timeframe for delivery although the contract specified that work should be delivered promptly.

In response to a follow-up question about whether there was any guarantee the remedy work would proceed, it was highlighted that CLP had worked hard to redevelop the Whitgift Centre over the previous nine years, resulting in two planning applications. However, if the original plans had progressed the town would have had an old fashioned town centre, based predominately around retail provision, which was no longer fit for purpose. The Council would continue to work with CLP on delivering a more viable town centre informed by community engagement.

As notice of the remedy could have been served from February 2022, it was questioned why the Council was only moving ahead with it now. It was advised that the Council had been seeking to find an agreeable way forward through negotiations with CLP. As these discussions had not resulted in a resolution and to preserve the Council’s position, it was no proposed that the notice of the remedy would be triggered

It was accepted that there was a considerable weight of public expectation upon the redevelopment of the town centre, but it needed to be recognised that the two developers, who owned the land involved were responsible for delivering any redevelopment and the Council’s role was as the local planning authority and separately using its influence to promote the best outcome for Croydon. The ILTA was an agreement with the Council for the use of its compulsory purchase powers (CPO) and the remedy providing for works to the value of £4m indexed was to indemnify the Council against the cost of the CPO. 

In response to a question about whether there had been consideration given to inserting other forms of compensation into the contract, it was advised that as none of the officers who had negotiated the contract were still employed by the Council, it was not possible to confirm. However, the advisors engaged by Council were specialists in their field and as such there could be a reasonable level of assurance that robust advice had been provided.

It was questioned whether the Council could ask for compensation for the loss of business rate income, that would have been generated through the Growth Zone scheme, from the non-development of the town centre. It was highlighted that at the start of the negotiations on the regeneration in 2010-11 the intention was to have a new mall which would solve all the issues of the town centre and increase business rates. The Growth Zone was a much later development and as such there was no link between the two.

Regarding the process for deciding what work was delivered under the remedy, it was advised that this was under negotiation with CLP. The key aspiration was for the work to lead to a new planning application from CLP, which had been the focus for the team working on the remedy. Any planning application was likely to be based upon a phased approach rather than a complete redevelopment proposed in the original applications. Any application would be based upon on a masterplan, the development of which, including public consultation, would be delivered through the remedy. The Council would work closely with CLP to benchmark any work undertaken to ensure value was achieved, but the key outcome would be the redevelopment of the Town Centre. It was confirmed that there were robust governance processes in place to sign off any work, with a commitment to transparency and the release of information wherever possible. 

It was agreed that it was important for the Council and CLP to work together to lead the way forward on the town centre. The Mayor had asked officers to start work on creating a vision for the town centre which was likely to be completed later in the year. Separately, it would be the responsibility of CLP to lead on the development of a masterplan and a planning application. It was advised that it would typically take approximately twelve months to deliver a masterplan document.

Regarding the activation of the Alders building, it was advised that CLP had hoped to have kept the existing traders in place, but due to significant health and safety issues relating to its condition, had needed to close the building. CLP had spent a considerable sum to rectify electrical, plumbing and escalator issues and there was an intention to find meanwhile uses for the building. It was originally hoped that this would happen before Christmas, but further maintenance work had been identified. The remedy also included investment for improvements in the Whitgift shopping centre

It was disappointing to note that the Council had been unsuccessful in its bid for levelling up funding, with only seven London boroughs awarded funding. The Committee asked to be kept informed of any feedback received from the Secretary of State on the reasons why Croydon’s bid had been unsuccessful. The Cabinet Member confirmed that he would continue to work with the Mayor and officers to make the case for Croydon and pursue any new funding opportunities that became available. It was also important for the Council to ensure that its public realm infrastructure was well looked after as this would send out a positive message about Croydon.

It was accepted that the economy had changed in Croydon and a review was needed to inform the economic vision and to ensure there was a realistic understanding of the local economy. This would help to ensure that there was a clear strategy for office retention and job creation in borough, which were essential to growing a strong economy. It was suggested that any economic vision should be supplemented by a Business Retention Strategy and a plan for attracting inward investment.

At this stage the meeting moved into a confidential session to discuss the information set out in the Part B report. The discussion focussed on the timescales for the remedy and the legal process involved. A full summary of the discussion is set out in the confidential Part B minutes of the meeting.

Following the return to a public session the Chair brought this item to a conclusion by thanking those present for their attendance at the meeting and their engagement with the questions of the Committee.

Actions arising from the meeting

Following the discussion of the Whitgift Indemnity and Land Transfer Agreement Remedy item at the meeting, the Committee agreed the following actions that would be followed up after the meeting.

1. The Committee that the Town Centre would continue to be an of focus in its work programme and that it would want the opportunity to review the following once available:-
   1. The Croydon Limited Partnership (CLP) Town Centre Masterplan
   2. The Mayor of Croydon’s Town Centre Vision document
   3. An update on the delivery of the works identified in the 25 January 2023 Cabinet report following the conclusion of the six month negotiation period with CLP.
2. The Committee would ask that any feedback provided by the Secretary of State on the failure of the Council’s bid for levelling up funding is shared with the members of the Committee once received.

Conclusions

1. The Committee welcomed the proposed use indemnity and land transfer remedy by the Council as a means of levering funding for improvement work in the Town Centre.
2. Although it was acknowledged that the work negotiated through the remedy process was subject to ongoing negotiation with CLP, given public frustration with the perceived inactivity in the redevelopment of the town centre and the redevelopment of the town centre being a key part of the Mayor’s Business Plan, realistic time scales for delivery needed to be defined as soon as possible to manage expectation and provide accountability.
3. The Committee welcomed confirmation that the Mayor had asked officers to begin work on developing a Town Centre Vision and would request that pre-decision scrutiny is built into the timetable for the production of this document.
4. It was disappointing that the Council had not been successful in its bid for levelling-up funding, which increased the importance of working with CLP to redevelop the town centre. However, the Committee was encouraged by the Cabinet Member’s commitment to pursuing all avenues for levering funding into the town centre and would suggest engaging with the Mayor of London, if not already doing so.
5. It was highlighted that job creation and office retention was key to the economic health of the borough and confirmation that an Economic Strategy was needed was endorsed by the Committee.