Agenda item

To consider a report which proposes immediate changes to the Council’s current arrangements for reporting and risk management of the wholly-owned companies.

The Sub-Committee considered a report proposing immediate changes to governance and reporting arrangements of the Council’s wholly-owned companies following a review of recently-published CIPFA good practice guidance on local authority-owned companies and the findings of Public Interest Reports on the governance arrangements of various local authority companies. Appendix 4 to the report contained exempt information and would be considered in Part 2 of the meeting.

Kevin Melling, Managing Director of Ansa and Orbitas, attended the meeting and, at the invitation of the Chair, spoke on this matter.

Members commented that the review of governance arrangements should include Tatton Park Enterprises.

RESOLVED (unanimously)

That the Sub-Committee

1.    supports the contents of the CIPFA Guidance (Local Authority Companies: a good practice guide, 2022), Public Interest Reports and the Governance reports (Appendix 3 to the report);

2.    agrees the appointment of a member of the Finance Sub-Committee as a shareholder representative and an observer to the board of each company, with access to all information, the members appointed being:

Councillor A Stott - Ansa

Councillor D Brown - Orbitas

Councillor S Gardiner - Tatton Park Enterprises

3.    agrees that all Directors of wholly-owned companies immediately receive formal training and that both Cheshire East Council and each company provides the shareholder with a programme of training and implementation dates;

4.    agrees that arrangements be put in place for:

(a)  quarterly reporting of Company Accounts to the Corporate Leadership Team (CLT) and the Shareholder (via the Shareholder Working Group); and

(b)  annual reporting of Company Accounts to the Audit and Governance Committee;

5.    agrees the terms of reference for the governance review at Appendix 2, subject to an amendment to provide that a working Group of 7, comprising 5 elected members and 2 officers (the latter representing the Finance and Legal services respectively), be appointed to undertake a full review of the structure and governance of the Council’s wholly-owned companies in line with the Guidance (and toolkit for undertaking strategic and governance reviews), following which a further report will be brought before the Committee;

6.    agrees that the working group referred to in resolution 5 comprise the following elected members:

Councillor D Brown

Councillor S Carter

Councillor S Handley

Councillor S Pochin

Councillor L Smetham

7.    confirms the closure of Cheshire East Residents First (CERF) and delegates authority to the Director of Governance and Compliance, in consultation with the working group where appropriate, to make any consequential changes to the governance structure of the Council’s ASDVs, their respective governance documents (including the Shareholders Agreements) and the Constitution of the Council as necessary in order to implement the revised arrangements.