Councillor Roy Lees left the meeting.

The Executive Member (Homes and Housing), Councillor Jane Fitzsimons, presented the report of the Director (Business, Development and Growth) which set out the financial and strategic case for establishing a wholly owned Local Housing Company (LHC).  This will enhance the quality of private rented homes in Chorley, expand the provision of affordable homes for local people and generate income for the Council.

Despite significant housebuilding activity in Chorley over the last five years and in particular the addition of 638 new affordable homes, there remains a significant and continuous demand for affordable homes.  There are 1,050 households currently registered on Select Move.

The Council can build or acquire 200 units without reopening the Housing Revenue Account (HRA).  The Council currently holds six units at Cotswold House and is acquiring another 10 for Syrian Refugees and 65 at Primrose Gardens.  This will leave up to 120 units that the Council could acquire and still remain under the HRA cap.

Members supported the proposal and noted that the properties will be spread across the whole borough.  Councillor Martin Boardman, Deputy Leader of the Opposition, echoed the support of the Opposition for this. 

The Executive Member (Homes and Housing), Councillor Jane Fitzsimons, proposed and the Executive Member (Resources), Councillor Peter Wilson seconded the DECISION –

1.    That a mixed tenure model incorporating private rented and affordable housing is the optimum model with private rented homes cross-subsidising the affordable provision.

2.    To deliver a private rented and affordable homes model as outlined requires £13.8 million of loan investment from Chorley Council to be funded via PWLB borrowing.

3.    To begin the process of establishing a LHC with the aim of holding the inaugural Board meeting in early 2019.

4.    That specialist financial, governance and legal advice will be procured to ensure that the company structure and detailed business case optimises the agreed financial and strategic outcomes.

5.    To note the long term nature of the project and that, if more than 120 affordable homes are delivered, the Council will need to consider establishing an independent Registered Provider as a discrete subsidiary of the LHC.

6.    To note that in line with all similar vehicles established to date, the approach requires a long term investment strategy of at least 10 years to benefit from the economies of scale associated with owning a significant property portfolio and particularly for the affordable homes element of that portfolio.

7.    That further detail including company structure, governance and reporting arrangements be brought back to Executive Cabinet for consideration with the intent being that the management of the LHC will be delivered in-house.

Councillor Roy Lees returned to the meeting.