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To note the appointment of Mr M Baldock in place of Mr H Birkby.
The Sub-Committee noted the appointment of Mr C P D Hoare in place of Mr H Birkby.
RESOLVED that subject to the correction of Minute 1 to read “2014”, the Minutes of the meeting held on 9 March 2015 are correctly recorded and that they be signed by the Chairman.
(1) The Sub-Committee considered whether to treat this item as Open or Exempt business in the light of the Exempt Appendix. Following advice from Legal Services that discussion of certain sections of the Exempt Appendix would place the Local Authority Trading Company (LATC) at a competitive disadvantage, the Sub-Committee voted to exclude the public.
(Open Access to Minutes)
(Members resolved under Section 100A of the Local government Act 1972 that the public be excluded from the meeting for the following business on the grounds that it involved the likely disclosure of exempt information as defined in paragraph 3 of Part 1 of Schedule 12A of the Act.)
(2) The draft Articles of Association were tabled.
(3) The Director of Infrastructure introduced the report by saying that the decision to externalise and establish a LATC to be fully owned by KCC had been taken as part of the Facing the Challenge process. The property and Infrastructure Group had commissioned Cornerstone as its external advisers to support the process and to offer external challenge. The Facing the Challenge Team had undertaken market engagement to provide an independent market review.
(4) The rationale for the establishment of the LATC had been considered by the Commissioning Advisory Board, the Policy and Resources Cabinet Committee and by Cabinet.
(5) The Director of Infrastructure set out the four key components to governance and commissioning for the LATC. These were Commissioning Governance for KCC, Corporate Governance for KCC, Corporate Governance for the LATC, and Corporate Governance for new clients. Assurance that the appropriate checks and balances were in place for each of these components would be provided by Legal Services, the Section 151 Officer and Internal Audit. She added that the lessons of the Council’s other companies had been taken fully into account in the process of developing these governance arrangements.
(6) Mr Singh, on behalf of Legal Services confirmed that in his opinion the governance arrangements were appropriate.
(7) In response to questions from Mr Smyth, the Director of Infrastructure confirmed that there would be no formal KCC Board to monitor compliance with the 2015 regulations by the company. This function would be carried out by herself and the Cabinet Member for Corporate and Democratic Services, reporting to the Policy and Resources Cabinet Committee and the Governance and Audit Trading Activities Sub-Committee as appropriate. It was proposed that an Audit Committee would be established in the LATC and that KCC would provide audit services.
(8) The Board of the LATC itself would consist of 6 to 8 members. If a 6 member Board were set up, it was intended that it would consist of 2 Executive Directors from the LATCO management team, 2 independently appointed non-executive directors and 2 KCC non-executive directors who would be KCC employees with relevant experience. In the event that an 8 member Board were set up, the number of independent and KCC representatives would be increased to 3 each.
(9) Mr Singh agreed with Mr Bird that the Articles ... view the full minutes text for item 6.