To consider a request for Additional Capital Funding for Mablethorpe and Skegness Towns Funds Submissions.

The Chairman of Executive Board presented a report that enabled consideration of committing a further maximum amount of £3.5m to the six Towns Fund projects managed by the Council.

The background to the report was highlighted to Members, as set out at Paragraph 1, pages 42 to 43 of the Agenda refer.

It was noted that following the successful approval of the Towns Investment Plans, the Government offered a Town Deal to the value of £23.9m for Mablethorpe and £24.5m for Skegness to fund 13 different schemes.  Six of these projects were managed by the Council with capital cost of £35m.  Now that the cost submissions had been received and reviewed with the Council’s respective contractors, there was a requirement to commit a further maximum amount of £3.5m to these projects from the Council’s reserves.  This represented an uplift of around 10% and was largely due to inflationary pressures.

The funds would be set aside on a contingency basis and would be funded from the Growth Reserve and/or the returned Property Fund Debt.

Following which the recommendations were duly Proposed and Seconded.

Members were invited to put their comments and questions forward.

• A Member voiced concerns that the government was not providing further funding to bridge inflationary cost pressures.  It was however acknowledged that the Towns Fund projects were massively important and significant to the business economy and the way the Council operated with the potential for generating income in the future.

Following which, Councillor Jackson proposed that an amendment be made to put forward to government that it would increase its contribution by 10% to account for inflation.  The form of working was confirmed as follows:

‘ELDC will ask the government to increase their contribution to Skegness and Mablethorpe towns fund by 10% to account for inflation’.

Councillor Howard, Leader of the Labour Group seconded the proposal.

The Leader of the Labour Group requested that the Leader of the Council engaged with the Chair of the Connected Coast Board to set negotiation into operation as soon as possible to ensure that the Council was in a position to deliver these projects as they were very worthy and hopefully in years to come would be seen as a pivotable moment for the coastal area.

In response, the Leader of the Council agreed that the inflationary pressures were unfair and a challenge to the Council.  However, it was important to note that the Council had received £50m direct funding from the government to invest in coastal communities and also significant amounts of approximately £40m brought in from various partners in terms of direct match funding.

Members were further advised that on the back of discussion of the Partnership, since the levelling up funding had been announced and the work around levelling up bids the Council was waiting for the outcome and clarity on the following:

• Two levelling up bids for £8.1m.  The Council had received UK Shared Prosperity Funding for £4.1m.

• It was awaiting the outcome for a Rural Prosperity bid of £1.7m.

• The Council had received £2m across the Partnership from the Arts Council - £657k of this was coming to ELDC.

• The Council was positively awaiting an outcome of £5m Cultural Development Fund.

• The Arts Council had granted £30k to support various local arts and cultural events.

• £3.65m had been received for Sustainable Warmth Grants, £2.2m for Green Homes Grants (Phase 1) and £1.1 m Green Homes Grants (Phase 2) plus £10k allocated for orchards.

The Leader of the Council further highlighted to Members that a request from government for an uplift in respect of the inflationary pressures had been made and refused and considered that it was important that the positive relationship the Council currently had with the government with regards to the Towns Fund Projects was retained.

The Leader of the Council advised that he could not support the proposed amendment.

N.B.  At this point in the Meeting, Councillors Adrian Benjamin and Tony Howard asked it be noted that they were Members of the Connected Coast Board.

Further discussion ensued and the following points were made by Members:

• A Member highlighted that the Council should be looking at how its partners were affected by the Towns Fund deal procedure, for example the National Trust and British Rail and queried what financial contribution they would be making to the projects.  A further Member strongly considered that the Council was not subsidising but investing in the projects and more investment at this stage would result in a better result in the long term.

• The Portfolio Holder for Planning commented that significant towns funding would make a huge transformation to the communities where it would be spent.  Although in a difficult time, the Towns Funding money had been secured, the Council had a sound financial administration and had the reserves available at the present time to ensure that the projects happened.

• In relation to the comments made with regards to inflation, a Member highlighted that the current high rate of inflation was not a government problem and had spread worldwide as a result of the war in Ukraine and the repercussions of Covid.

Upon putting to the vote, the Amendment detailed below (in bold text) was declared lost.

‘ELDC will ask the government to increase their contribution to Skegness and Mablethorpe towns fund by 10% to account for inflation’.

Debate returned to the substantive proposition.

The Portfolio Holder for Finance advised Members that the Council was in a position to allocate the £3.5m from reserves to support the Towns Fund Projects and encouraged Members to vote for this.

In response to the significant issue raised related to Internal Drainage Board levies, the Leader of the Council acknowledged that this would have to be addressed for the future and advised Members that senior officers at the Council were already in contact with government and local MPs working on this.

N.B.  Councillor Campbell-Wardman left the Meeting at 3:38pm and re-joined the Meeting at 3:42pm.

A Member raised a number of queries in relation to the allocation of the towns funding, the experiences of cost pressures from other towns that had received this funding and whether the schemes could be adapted to fall within budget.  In response, the Leader of the Council stated that he was aware that there were concerns from other towns in relation to inflationary pressures and confirmed that officers were in contact with them.  With regards to the projects, a commitment had been made to deliver these and it was stressed that the Council should progress with these as these would not just benefit the coast but would impact on all communities.

The Leader of the Council highlighted recent worries with the changes at the top of central government and fears that changes on funding might lead to the loss of the Towns Fund ambition.  However, he was content that the Council could support this and would face the challenges and if these projects could be delivered it would deal with deprivation, education skills and economic development issues that had challenged the council for years. 

Following which, the proposal set out within the recommendation was carried.

RESOLVED

• That up to £3.5m be allocated from reserves to support the Towns Fund Projects.  The final amounts would be subject to agreement with the Council’s Section 151 Officer, The Lead Member for Finance, the Chief Executive, and the Leader of the Council.

N.B.  Councillor Devereux left the Meeting at 3:47pm and re-joined the Meeting at 3:52pm.

N.B.  Councillors Martin and Alex Hall left the Meeting at 3:47pm and re-joined the Meeting at 3:56pm.