council's asset management plan


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council's asset management plan

  1. 1. APPENDIX 2 LIVERPOOL CITY COUNCIL CORPORATE ASSET MANAGEMENT PLAN 2009/10 – 2011/12 Report of the Executive Director (Regeneration) (John Kelly) John Kelly (Executive Director) Tel: 233 8210 Nick Flanagan (Corporate Asset Management Officer) Tel: 233 2731 Appendix 2 to MTFP CT0409 1
  2. 2. LIVERPOOL CITY COUNCIL CORPORATE ASSET MANAGEMENT PLAN 2009/10 TO 2011/12 CONTENTS 1. Executive Summary 2. Corporate Context  Corporate Vision  Strategic Innovation & Improvement Programme  Linkage with other key strategies 3. Organisational Arrangements (for AMP)  Corporate Governance  Corporate Groups  Operational Arrangements 4. Approach to AMP  Service Asset Management Plans  Challenge Methodology  Option Appraisal  Asset Reviews  Data Management – Tribal/K2  Partnership Working including community asset transfer  Asset Surveys  Sustainability  Corporate Landlord 5. Future Direction of Asset Base  Strategic objectives  Gap analysis  Asset Management Issues  Asset Plan 6. Strategic Actions (09/11) Appendices A Financial Breakdown – Capital Funding Gap B Asset Plan 2009/2014 C Performance of Asset Base Appendix 2 to MTFP CT0409 2
  3. 3. CORPORATE ASSET MANAGEMENT PLAN 2009/10 TO 2011/12 EXECUTIVE SUMMARY After its staff the council’s land and property is the next biggest resource. The Asset Management Plan (AMP) directs how the council uses its assets in support of its strategic aims and priorities and is updated on an annual basis. In conjunction with the Capital Strategy and Medium Term Financial Plan (MTFP) it illustrates the Council’s effective and efficient uses of its resources. The key aims of the plan are to:- • set out the actions and anticipated outcomes over the short (2009/10 – 2011/12) and medium term (2012/13 – 2018/19) for the council’s asset base; • show how the authority’s land and property contribute to (a) Corporate Plan priorities and (b) improvements in business delivery; • provide a planned approach to review and challenge the use and retention of assets, providing a transparent framework for investment and disinvestment decisions in the asset base including the projected capital funding gap and proposals to narrow the gap; • detail current and future arrangements to support the asset management process at officer and Member level; • highlight how the asset base is performing and to use the data in an intelligent manner to inform decisions on the use and direction of the asset base; • inform the roll forward of the MTFP within the framework of the Capital Strategy. Scope of the Plan This plan covers all land and property owned and used by the Council except for highways and ICT assets, which will be reported separately. Following both reviews the results will be incorporated into future iterations of the AMP. Appendix 2 to MTFP CT0409 3
  4. 4. CORPORATE CONTEXT Corporate Vision A new vision and streamlined priorities, as detailed below, were adopted in 2008 “Liverpool City Council is committed to working in partnership from a basis of sound financial and strategic planning to achieve a thriving international city that can compete on a world stage as a place to live, work and visit.” 1. Grow the city's economy • Make Liverpool a first choice for investment and growth by working with the private, not for profit and public sectors quickly and effectively with an emphasis on quality of infrastructure. • Promote enterprise, attract investment through developing the city’s co- ordination and offer across the city region to provide scale, connectivity and sustainability of its economy. • Increase business density and gross value added (GVA) beyond national levels for city regions to deliver an environment which provides opportunity, employment and well-being for our citizens, business and investors. • Exploit the city's wider cultural advantage to attract and retain visitors, workers and residents. 2. Empower our residents • Ensure safeguarding and inclusion of the most needy and excluded groups in the city, providing equality and real opportunity for improvement and enhanced quality of life. • Confront barriers to employment and training through lack of access, deprivation, discrimination and poor health to ensure provision of a highly skilled workforce. • Developing first rate education and training from early years and further position Liverpool as a prime destination for postgraduate research. 3. Develop our communities • Increase peoples' sense of influence in decisions affecting their lives and communities through an open, fair and accountable neighbourhood-driven processes. Appendix 2 to MTFP CT0409 4
  5. 5. • Challenge crime and antisocial behaviour safeguarding young people from becoming perpetrators or victims. • Provide sustainable communities through access to decent homes and best practice in environment management including, recycling, street cleansing and environmental enforcement against dereliction and environmental detractors. The authority’s land and property has a pivotal role to play in supporting and shaping the delivery of these aims and objectives, which is illustrated in the council’s Asset Plan set out in appendix A. Strategic Innovation and Improvement Plan In response to the 2008 CPA assessment the Council has adopted a Strategic Innovation and Improvement Plan to strengthen its future ambition and delivery, its finances, the corporate structure, together with a number of other areas, identified by the Auditors. The Financial and Performance element has been further updated to ensure the use and management of the Council’s resources, including its assets, are better integrated with the key business processes of the Council. This has resulted in a new Corporate Improvement Programme, focusing on five key programme areas, and associated projects, being rolled-out in support of this process. In terms of asset management the key programme will be the review of Assets and Customers which has within it the following the projects:- • Asset Strategy • Buildings & Accommodation • Flexible Working • ICT Strategy/plan • Customer Contact The key objectives of the programme are to:- • develop a coherent and co-ordinated approach to planning and managing the Council’s assets to meet the needs of customers and corporate and business priorities; • assist in the allocation of resources to corporate priorities. Project plans and work programmes have been prepared for both the overall programme and individual projects. These will be progressed over the next 12-15 months to enable the resultant outcomes and recommendations to be embedded Appendix 2 to MTFP CT0409 5
  6. 6. within the council’s business planning processes, including asset management planning. In part, to assist the delivery of the SIIP the governance and senior management arrangements in the authority were also restructured in 2008 to better align roles and responsibilities to its aims, priorities and strategic outcomes. This included the alignment of the council’s aims which those of Liverpool First (the local strategic partnership). Linkages to Other Strategic Documents The Asset Management Plan forms a suite of strategic documents and plans, including the Capital Strategy, ICT Strategy, Workforce Plan etc. which supports and inform the Authority’s Medium Term Financial Plan, Corporate Plan and corporate business planning processes. The relationship and hierarchy between these strategies and documents is set out below Appendix 2 to MTFP CT0409 6
  7. 7. ORGANISATIONAL ARRANGEMENTS The continued development and roll-out of asset management planning is dependent on the co-operation and joint working of services across the Council. It is important that the right structures and governance arrangements are in place to ensure efficient and effective management of the authority’s assets. During 2008 significant changes were made to strengthen the organisational and operational arrangements around asset management planning, as detailed below. T he relationship between the various arrangements are also illustrated in the diagram on page 10. Corporate Governance Key strategic property decisions (such as declaring assets surplus, sales at less than best price, buildings schools for the future, approval of the AMP etc.) are taken by the Council’s Executive Board, which is the executive decision making body within the council. Following a restructure of the functions of the Executive Members on the Board to better align responsibilities to the new corporate aims responsibility for asset management including all property and development matters now rests with the Executive Member for Assets & Development (as previously highlighted in diagram 1 on page 7). In accordance with the Constitution certain property matters can be approved under delegated powers (statutory disposals, garden extensions, management issues in respect of the C&I estate etc.). This has recently been extended to allow the Corporate Property Officer (see below) to approve all disposals, where best consideration is obtained in consultation with the leader of the Council and the Executive Members for Assets & Development and Finance & Europe. All such decisions are reported, for information, to the Regeneration Select Committee, which also includes the asset management plan as part of its annual work programme. Organisational Asset Management Arrangements Strategic Asset Management Group (SAMG) The Group was restructured in early 2008 to ensure asset management was given a higher profile at senior management level. It comprises the Executive Directors Regeneration (aim 1), Community Services (aim 2); Children’s Services (aim 3), the Assistant Chief Executive, the City Treasurer, and the Assistant Executive Director for Development, who is also the Corporate Property Officer. Officers from Property & Asset Management Services and Premises Management also attend in an advisory capacity. To ensure a consistent approach the group also operates as the Project Board for the Asset/Customer programme as part of the SIIP. Appendix 2 to MTFP CT0409 7
  8. 8. The key objectives of the Group are to:- • ensure that the use of the Council’s assets integrates with the business of the Council and is a fundamental component for driving forward change; • put in place a robust and transparent structure, with clear lines of responsibility and reporting, to ensure effective and efficient management of the asset base; • maximise the use and value of the Council’s assets to meet the aims and priorities of the Authority; • consider and advise on strategic property and associated financial matters; • better integrate regeneration and major property initiatives including the alignment of resources, promoting opportunities for co-location and shared facilities; • ensure that there is an asset management culture across the Council with engagement and buy-in at a senior officer and elected member level. Operational Property Group (OPG) Sitting below the Strategic AMG is a cross-service officer group looking at the day to day delivery of operational property matters. The group provides support to the AMG, undertaking reviews of the Council’s assets, together with formulating strategies and policies to improve the management and use of the Council’s assets. The group also acts as the project team for the SIIIP Asset Strategy, with part of the group also supporting the SIIP project on Accommodation and Buildings. Corporate Regeneration Group (CRG) Working in parallel with the SAMG this Group provides a corporate overview to ensure capital investment is targeted to achieve best value and maximum effect, making sure all capital investment is subject to an objective investment appraisal process and key issues such as asset management and other property related matters are considered. Operational Asset Management Arrangements As a consequence of the organisational restructure in October 2008 various property functions have been consolidated under the new AED post for Development, which is now responsible for:- • Building Schools for the Future (including operational delivery of the school programme, including primary schools, together with the management of Children’s Services capital programme.); Appendix 2 to MTFP CT0409 8
  9. 9. • Development (facilitation/delivery of major regeneration initiatives including Project Jennifer, New Anfield, Liverpool One etc.); • Property & Asset Management (see below) and • Premises Management (full range of facilities management for the Council’s operational buildings including repair and maintenance, building cleaning, energy management, document archiving etc.). This consolidation of business units under a single AED will enable greater joined up working ensuring a more comprehensive approach to property and asset management matters such as the integrated work undertaken on site selection for wave 6 of the BSF programme. Operational responsibility for asset management sits with Property & Asset Management Services and includes:- • the on-going development and implementation of asset management planning across the Council, including the annual revision of the corporate AMP; • management and maintenance of the Authority’s central land and property records, including the implementation and management of a new single corporate system (Tribal/K2); • support and assistance on corporate property initiatives such as Building Schools for the Future, Asset Backed Vehicles etc.; • management of the Council’s disposal programme and Corporate & Investment estate. Appendix 2 to MTFP CT0409 9
  10. 10. ORGANISATION ARRANGEMENTS –ASSET MANAGEMENT & CAPITAL PROGRAMME Functions Executive Board Set the corporate aims, objectives and priorities of the Council – Drive the business of the Council Relevant Executive Relevant Select Member Committee Assess and make recommendations on best use of the Council’s Executive Management resources Team (including CPO) Control policy on asset use and initiate, appraise, monitor and make Capital Programme recommendations on priority projects Strategic Asset Corporate Regeneration including HMR, BSF, (including assets, acquisitions etc) Management Group Group Liverpool Vision, ABV’s and other initiatives Operational Asset Management Group Day to day operational property and financial matters Individual Service Areas, including main property teams (PAMS, PMU, 2020, Major Initiatives and Portfolio Finance Teams reporting through relevant AED, ED and Management Teams Officer Groups/Teams Elected Members Appendix 2 to MTFP CT0409 10
  11. 11. APPROACH TO ASSET MANAGEMENT PLANNING Service Asset Management Plans (SAMP) To better integrate service/business planning with asset management and resource planning those business units which meet the following criteria are required to produce SAMPs, to a prescribed format (as approved by the OPG and SAMG). i. occupy and use land and property for direct service provision (eg libraries, sports centres, schools, parks etc.), ii. manage land and property (eg. administrative accommodation, Corporate & Investment estate) and/or, iii. are involved in major initiatives which impact on the asset base (eg. BSF, HMRI etc.). For all other business units not covered by the above criteria their accommodation needs will be assessed as part of the Business Planning process for each service. The plans, which are required to be place by March 2009, will in turn inform the Council’s approach and policy on its office accommodation. In summary the SAMPS seek to: • identify the Business Units’ short and medium term service and business requirements; • capture the Business Units’ proposed medium term asset needs having regard to their business requirements and future challenges and changes to service delivery and asset use; • assess the difference between the Services’ existing and proposed asset needs (including their aspirational proposals), identifying areas of mismatch and any resulting requirements for investment, together with opportunities for rationalisation. From the responses and further discussions with the Business Units a revised analysis of the capital funding gap between the current and future asset requirements, together with a five year indicative asset plan has been produced. Both will be subject to further review and challenge and will inform the future the development of the MTFP. Challenge Methodology As part of the next review of the operational portfolio a more structured approach is being adopted to challenge the use and retention of the assets. The approach will include an assessment of the assets based on:- Appendix 2 to MTFP CT0409 11
  12. 12. The views of the business unit as to the suitability of the asset (in terms of its ability to assist service delivery i.e. is it fit for purpose); whether it provides value for money and their future proposals for the asset (i.e. retain, invest, replace, co- locate, dispose etc). This information has been collated as part of the SAMP. A technical assessment of how the asset is performing having regard to the condition of the building and the level of maintenance backlog; sustainability (occupational costs, energy consumption, CO2 emissions), accessibility (i.e. DDA compliant), sufficiency and the capital value tied up in the asset. Again this information has been captured and is in the process of being migrated into Tribal to ensure the data is held in one place and to assist future interrogation and analysis of the information. The views of the customers and key stakeholders in terms of how they want to access and use council services, including how and where it should be delivered from. Other corporate initiatives or programmes which could impact on the use, retention or disposal of an asset (i.e. assets which fall within strategic initiatives such as Housing Market Renewal). To assist in this process the various key initiatives, projects and disposals have been mapped across the city to enable them to be overlaid over the assets being reviewed and vice versa. This data is also being used to inform the exploration of cross-agency use of public sector assets and assist in the development of the Local Development Framework, including the Strategic Housing Land Allocation Assessment. Other corporate pressures and external factors i.e. what are corporate business requirements of the authority such as HR, ICT, financial (budgetary pressures), together with other external factors such as known changes in legislation and the potential impact it could have on the asset base. As part of the SAMP exercise and the roll-out of business plans services are being asked to consider and comment on the impact these areas will have on their business and consequently on asset use. This will enable the assets to be ranked and prioritised based on their performance, identifying the best and worst assets, and their strategic and corporate importance to the authority. From this the assets will be categorised as to whether they should be:- • retained with continued minor investment undertaken; • enhanced or a replacement facility provided; • better utilised (including shared and/or co-location) or; • disposed either outright or as part of a wider development opportunity. Appendix 2 to MTFP CT0409 12
  13. 13. Option Appraisal As part of the current process in determining future asset use, where the existing service area has no operational need for the building a disposal appraisal is carried out. This includes an assessment of the potential options for the building, including re-use by other service areas, possible uses by the community and its potential disposal/rental value. The use of option appraisals has also been applied to assist site selection in respect of the BSF programme. Asset Reviews Set out below is the proposed programme to review the Council’s asset base over the next three years. Where appropriate the challenge methodology, as described above, will be used to determine the future use of the asset. The result of each review will be submitted to the SAMG for consideration before consideration by the Executive Board for approval, if required. Asset Group Review Date Lead Area/Group Operational Portfolio 2009 Operational Property Group (OPG) Primary school estate 2009 BSF/PAMS Community assets Late 2009 PAMS/Neighbourhood Management Vacant Park/Cemetery Assets 2010 OPG Vacant Land 2010 OPG Investment Portfolio 2011 PAMS Data management Critical to the development of asset management planning is the need to have up-to-date and accurate data on the Council’s assets. A new single corporate Appendix 2 to MTFP CT0409 13
  14. 14. asset management database (Tribal – K2) is currently being implemented, which will hold and manage data on all the Council’s land and property including associated and incidental assets located within its buildings. Details of the application and the main activities that will be managed through the system are set out in the diagram below. Although details on highway and highway infrastructure will continue to be recorded separately, the data will be linked through the Council GIS platform, MapInfo. Land and property data is currently being captured, cleansed and populated into the new system on a planned and incremental basis. Each asset is being assigned a Unique Property Reference Number (UPRN), which will enable it to be geo-coded and shown in MapInfo and baseline on all the Council’s land and property (which will be in excess of 15,000 individual records) will be imported into Tribal by 31 March 2009, with supporting data (i.e. lease details, condition information, energy details etc.) to follow over the following 12 months. Each asset is also being assigned a category as to why it is being held to assist in future reviews of the asset base. The system is already in use by the Premises Management Unit to record, track and manage data in respect of repair and maintenance expenditure, asbestos and legionella surveys. Use of the system by other Service areas will follow when the relevant data is migrated across. Part of the implementation process will include a review of existing processes and systems to improve the way the Council manages and disseminates changes to its property data to ensure key service areas are made aware and notified accordingly. The Council’s fixed asset register has been reconciled against the data being imported into Tribal. From April 2009 Tribal will hold and provide the baseline data making up the fixed asset register, thereby removing the need to reconcile two data sets. An extract will be taken from Tribal and passed to Financial Management to enable all necessary financial adjustments to be made for the Council’s accounting purposes and requirements. In tandem with the Tribal project the Council has commenced voluntary registration of all of its land and property with the Land Registry. As well as validates the Council’s ownership of its assets it will remove the need to retain title deeds, thereby freeing up storage space in city centre buildings. The new system, when fully operational will:- • hold comprehensive information on all the Council’s assets, including performance information and will be the Council’s single corporate system for all property and asset management purposes enabling the numerous existing legacy systems to be turned-off; • streamline processes, thereby freeing up staff resources to focus on other priorities; Appendix 2 to MTFP CT0409 14
  15. 15. • enable improved information on the assets owned by the City to be available to inform future decisions on the use of the Council's land and property and facilitate better management of the accommodation; • allow web-enabled access by the public to view and check Council ownership of land and property to be rolled out mid 2010. Partnership Working The Council is already working pro-actively with the Primary Care Trust (PCT), Mersey Care and the Police on various accommodation matters. To maximise asset use from the public sector estate the intention is to broaden those discussions with other key public partners including the fire and ambulance authorities, Job Centre Plus, NWDA and HCA. It has been agreed that Liverpool Appendix 2 to MTFP CT0409 15
  16. 16. First (who already have representatives from the key public partner agencies on the Board) will host and facilitate regular meetings of involving the above partners to collectively understand each partner’s asset requirements and explore the potential for shared facilities, co-location and asset swaps. The first meeting of the group is scheduled for March 2009. Community Engagement The council has a proven record of working with community groups to facilitate the transfer of Council assets to them. This included working with the Penny Lane Trust, to develop new community facilities off Penny Lane, for which the council, in conjunction with the organisation, successfully secured Big Lottery Fund, under round 2 of the Community Asset Transfer Fund. In addition a further 15 assets have been transferred to community organisations (excluding RSLs) over the last 5 years with a market value of £1.9m. Following the publication of the Quirk Review, to ensure a consistent and transparent approach the Council has been developing a new framework for considering and progressing requests from community organisations, including guidance and an application package for interested community groups. These arrangements will be reported separately to the Executive Board in due course. In tandem with the above the council is also looking to undertake a detailed audit of the various community groups operating in the city to identify where they are based and the range of services they provide to inform future decision about the use of council assets by the community. The community’s views are regularly sought on strategic property initiatives and regeneration schemes including regular consultation with customers in relation to the range of service they want delivering in respect of the network of children’s centres. As part of the review of the operational estate the intention is to broaden community consultation on how the community wants to access services and assets and a consultation strategy will be developed utilising existing ward base networks. Survey Data To ensure that the maintenance backlog information is up to date the operational accommodation has been subject to annual condition surveys, which identify the current condition of the premises and any significant repair and maintenance issues that have arisen since the last survey. In addition where a property has received the benefit of major refurbishment works or a building has suffered from significant impairment during the financial year these will also be included in the survey programme for that year to assess the impact. The survey data has recorded a year on year reduction in the backlog position, further details of which are set out in appendix C. From 2008/09 onwards a rolling programme of condition surveys will be introduced with 50% of the operational premises surveyed each year. From April 2009 Premise Management will adopt the condition survey format available from Appendix 2 to MTFP CT0409 16
  17. 17. the Tribal system, which will allow greater access to condition information to a range of users across the council, which will include the use of hand held technology to access, record and upload survey information. A detailed condition survey of the City’s parks and cemeteries and associated park and cemetery infrastructure (i.e. boundary walls, entrances, car parks etc.) is also being implemented by the Council’s ground maintenance partners. All vacant buildings in parks and cemeteries are also regularly inspected to monitor and control the risks associated with the assets. Finally 20% of schools are surveyed in detail every year as part of a rolling 5-year survey programme. Again this information has been used to assist in the business cases for both BSF and Primary Capital Programme. Safe Use and Control of Premises In 2007 the city council introduced an extensive training programme in property related health, safety and liability issues with the aim of improving the awareness of all managers / key staff with responsibility for the management of premises. The training identified corporate responsibilities and the effective control measures needed to meet current legislative requirements. The main issues covered in the programme were Management of Asbestos, Legionella and Water Systems, Fire Safety and Prevention, Permit to Work Systems and Control of Contractors. Briefings also took place with Executive Directors and Assistant Executive Directors to raise the profile of the issues and ensure a consistent approach across the council. Over 800 staff received training. As well as the training programme the following actions are being pursued to continue to meet our statutory requirements:- Asbestos - All operational premise have had an asbestos survey completed in accordance with The Control of Asbestos Regulations and an action plan to manage the risks has been introduced and monitoring/review arrangements are in place. Where appropriate the cost to safely remove the asbestos, as part of a managed programme has also been recorded. Legionella – A Risk Assessments Programme has been completed for operational premises with comprehensive record keeping of the control measures and monitoring procedures in place to comply with the Approved Code of Practice and Guidance for Legionnaires disease. Again cost information has been captured Fire Risk Assessments have been carried out and control measures implemented in all office accommodation to meet the requirements of the Regulatory Fire Safety Order Appendix 2 to MTFP CT0409 17
  18. 18. A Permit to Work system has been introduced across all operational premises to effectively manage and control the access of contractors to LCC sites. Disability Discrimination Act The city council has made significant investment (£4 million over the last 5 years) to comply with the requirements of the Disability Discrimination Act that requires services make reasonable adjustments to their premises to overcome physical barriers to access. In respect of the national performance indicator (BV156) measuring access to public areas within buildings the council were the top performing met authority with top quartile national performance. As some of the Access Audits undertaken by the council are over 4 years old Premises Management have now set a new local indicator to carry out a three year programme of access audits across operational premises commencing in 2008/09. Sustainability Since 1999 the authority has purchased and used 100% green electricity for all its sites, including all operational premises; schools; street and traffic lighting. Automated Meter Reading equipment has been installed to for the council’s entire gas and electricity estate (including schools) providing 24/7 real time data, actual billing reads, actual carbon emissions enabling better budget control. All Electricity, Gas and Water utility invoices have also been transferred to electronic billing and BACS payment. This 24/7 live data provides full in house analysis, profiling, league tabling and carbon reporting of all sites, which will be used to assist in future technical assessment of the asset base. Greater access to the data is also planned to allow all site managers to look at the performance of their sites. As a consequence of the introduction of the above systems Energy Performance Certificates have been produced and the Council will be able to fully comply with the National Performance Indicator 185. The Council is presently successfully operating a Carbon Trading model in line with the Local Government Information Unit in readiness for its introduction in 2010. An Energy guide has been produced for all new build and major refurbishment to ensure compliance to energy efficiency regulations. Work has also started on a sustainability plan of the council’s assets which will seek to reiterate existing legislative and policy requirements in respect of land, buildings and other assets (including ICT equipment, highway infrastructure (street lights) etc. scope out the current position in meeting these requirements, identify any gaps and options to reduce the gap (including the financial implications). A framework document scoping out the key areas to be investigated is to be considered by the Sustainable Communities Select Committee next financial year as part of its annual work programme.. Appendix 2 to MTFP CT0409 18
  19. 19. Corporate Landlord Currently the facilities management of the operational portfolio, excluding the schools, is undertaken by the Premises Management Unit, although budgetary responsibility and strategic decision making for some of the accommodation still sits with the occupying BU. It is proposed to review this arrangement over the next 12 months and explore the possibility of adopting a more comprehensive corporate landlord approach, with all property matters and decisions residing corporately leaving the Business Units to concentrate on service delivery. FUTURE DIRECTION OF ASSET BASE Strategic Objectives To ensure that the Council’s assets (land and property):- i. are fit for purpose and meet the needs of the customer and the business; ii. provide value for money, making the most effective and efficient use of the asset and the value tied up in them; iii. support, either directly or indirectly, the council’s aims and priorities with clear rationale as to why the asset is being held or should be disposed. In respect of (iii) above assets will be retained where it can clearly be demonstrated that they:- • contribute to the effective delivery of service provision (i.e. the condition and performance of the asset does not impede service delivery); • support and meet the needs of the community, including heritage and community assets such as parks and open spaces; • assist in the delivery of the City’s strategic, economic and regeneration objectives and/or; • provide value for money (in respect of their current or future investment and/or capital value). Where assets do not satisfy the above criteria consideration should be given to the asset either being disposed or better utilised, freeing up accommodation elsewhere. Strategic Targets As part of the SIIP regarding Assets and Customers a number of high level strategic targets and actions will be set to improve performance. These will include targets to improve the overall condition of the asset base, reduction in Appendix 2 to MTFP CT0409 19
  20. 20. maintenance backlog, the number of assets deemed fit for purpose and the sustainability of the asset base (notably reduction in CO2 emissions). Gap Analysis To ensure that the resources available to the Council are targeted towards those areas of greatest need and importance, having regard to the aims and priorities of the Council and the strategic objectives of the AMP, it is vital that there is a full understanding of the issues and challenges in relation to the Council’s land and property. A gap analysis of the property portfolio has been carried out, based in part on the SAMPs and follow-up discussions with services to assess and identify:- • the level of required maintenance (as assessed from the condition surveys), including works needed in respect of accessibility, asbestos, legionella etc; • areas of proposed new growth, including enhancement, replacement and shared use of facilities and new provision of accommodation. These include a mixture of approved commitments and service aspirations; • financial and opportunity savings realised through rationalisation and the level of anticipated receipts which could be relied upon (given the current and projected market conditions; • level of available resources potentially available. A financial breakdown of the capital fund gap to address the mismatch between current and future asset needs is set out in appendix B. This has been broken down between the short (i.e. 2009/10 – 2011/12), medium (i.e. 2012/2013 – 2018/19) and long (i.e. 2019/20 and beyond) term. The short term requirements reflect those proposals, which have some degree of approval or commitment from the Council and/or essential works are needed to satisfy legal/statutory requirements. Where there are funding gaps in the short term, which are not contained in the Capital Programme for 2009/10 to 2011/12 (notably the additional financing of £4.2m to deliver the Central Library scheme) these will be considered within the framework of the Capital Strategy and MTFP in future years. Over the next 12 months this assessment will be further refined, taking into account the outcomes from the other projects that are on-going as part of the corporate planning framework, which will have a bearing on the asset base including the ICT strategy, People strategy etc., together with future iterations of the SAMP and Business Plans. Potential Solution to Reduce Funding Gap In addition to the tradition solutions of targeted investment (where funding opportunities exist) and rationalisation of surplus assets other options are being Appendix 2 to MTFP CT0409 20
  21. 21. considered to bring about investment, reduce risk and liabilities and narrow the funding gap include:- • Invest to Save initiatives (using prudential borrowing) to create an investment pot to enhance the asset base where demonstrable benefits can be realised (backlog eradicated, prolonged economic life of the asset, operational savings, improved community useage etc.). • Asset transfer to third parties & community organisations. • Asset Backed Vehicles (ABV). In addition to the Inliverpool vehicle (see comments under Regeneration on page 25) discussions are continuing to establish an ABV with the Homes and Community Agency to accelerate regeneration proposals in Anfield Breckfield, bringing about opportunity savings and potential receipts for recycling back into the area. The model could be expanded to operate in other areas of the City and separate tentative discussions have been held with EP (now HCA) on a city wide model looking at commercial development and opportunities. • Charitable & Heritage Trusts expanding on a number of separate trusts that have been create in respect of Council assets, notably Croxteth Park. • Shared accommodation and/or joint developments with public partners. Asset Management Challenges & Solutions The key priorities and issues for the Business Units in relation to their assets, including potential areas of opportunities and threats have been summarised below. These have been grouped under the corporate aims they support, together, where identified or known at this stage, possible solutions to narrow any investment gap. This also includes a number of additional corporate themes which cuts cross all the aims. Aim 1 – Grow the economy Commercial & Investment Estate over the last 15 years the value and the income stream derived from the estate (in real terms) has markedly declined as assets have been sold to generate capital receipts and restructure leases. A structured programme to rationalise the non-income producing properties commenced in late 2007 (freehold interest in over 300 have been sold raising £260,000+ as Gershon savings) and a further disposal programme is being finalised to enable the disposal of other identified surplus properties, including income producing assets (which will start in 2010 subject to market conditions). In considering the future of the estate there are a number of key strategic issues/ decision the Council will have to take in the next couple of years:- Appendix 2 to MTFP CT0409 21
  22. 22. • The continued fragmentation of the portfolio and its ability to influence wider regeneration initiatives as further assets are sold. • The economic viability of the retained investment portfolio (having regard to management costs, the return on the investment and its capital value). • Whether the capital (investment) value tied up in the assets could be better utilised by rationalising and reinvesting the proceeds to directly support the corporate aims (i.e. does the authority wish to continue holding investment properties?). • Should the investment portfolio be re-structured through a managed programme of disposals and acquisition (of new investments) to create a more economically viable portfolio (with greater potential for enhanced income and lower management costs). Without intervention the portfolio will continue to lose value and influence (as a potential catalyst for stimulating regeneration and redevelopment scheme). Transport the total capital investment over the next two years is £36.617m in 2009/10 and £38.465m in 2010/11 to improve and maintain the network.(NB from 2011 Merseytravel take on sole responsibility for the transport strategy and as yet funding is not known / secured so only 2 years can be provided.) Major Schemes This includes Hall Lane (total scheme cost of £18.8m) and Edge Lane (total scheme cost of £30m) schemes will provide an enhanced infrastructure reducing the maintenance liability. However we need to maintain these assets in their current form for the next 10 years to satisfy the requirements for external funding. Landscaping developed in these schemes will be maintained for 3 years before being handed back to LCC. The cost to bring the Highway Assets up to an acceptable standard is: Carriageway £89m Footway £11m Street lighting £60m Drainage/culverts £10m Traffic signals £20m Bridges and structures £25m It is estimated that it would cost in excess of £215m to bring the assets listed above up to an acceptable standard resulting in top quartile performance. Appendix 2 to MTFP CT0409 22
  23. 23. Further investigative work is being undertaken as part of the Transport AMP to firm up the overall costs to improve the highway and highway infrastructure. The outcome of this exercise will be reported in future annual updates of the AMP. Regeneration the authority, in collaboration with public and private sector partners, are progressing a number of strategic regeneration initiatives, with the Council’s assets playing a pivotal role. These include:- • Project Jennifer • New Anfield • St Johns Market – planned refurbishment of St Johns Precinct, which will see the council’s market move into new facilities, which will also yield a significant receipt for the authority • Dingle Bank – proposed new housing development. Exploratory talks being held with Associated British Ports to bring forward a more comprehensive development of the Garston Docks. • Stonebridge Cross – 40 acre+ mixed use development. Following the withdrawal of the preferred developer, due to the effects of the credit crunch, a new masterplan is being prepared, in full consultation with the local community, to develop out the site and address the decline in other council assets in the vicinity. • Edge Lane • Inliverpool – an asset backed vehicle set up with the private sector (Inpartnership) to deliver sustainable, holistic regeneration through the redevelopment of unsustainable land and properties, levering in private finance (against the value of the Council’s assets) and recycling the resultant receipt following redevelopment to support agreed regeneration activities across the City. The Partnership is currently bringing forward a masterplan and outline planning application for the Boot estate The continued delivery of these projects is dependant on market conditions and options are being explored to mitigate the impact this will have on the successful delivery of the schemes. Aim 2 – Develop our Communities Green Spaces a longer term (25-years) investment plan is being developed to identify and address the history of under investment in the assets. The gap analysis to date forecasts that in excess of £70m is needed to address the decline in the city’s parks, open spaces and associated assets. Appendix 2 to MTFP CT0409 23
  24. 24. Key priorities include: • Continued restoration of the City’s heritage parks, notably Sefton and Stanley Park and improvements to Otterspool Promenade. • Exploring grant funding opportunities for Newsham Park, Anfield Cemetry and Springfield Park. This will almost certainly require some element of match funding from the Council, which is unlikely to be raised from traditional sources (i.e. capital receipts from the sale of surplus assets). • Addressing the decline in the hard infrastructure in the parks, cemeteries and smaller green spaces and the associated access problems this brings. Includes footways, driveways, boundary walls and structures, water bodies and courses, street lighting etc. • Reducing the high number of vacant buildings and structures in parks and cemeteries. The majority do not readily lend themselves to disposal and alternative measures are needed. • Upgrade of the cremators at Springfield Crematorium (at a cost of £0.7m) and miscellaneous works to Anfield crematorium. • Restoration of Croxteth Park, notably the Hall, which has been identified by English Heritage at being at risk. Options include using the dowry fund as a revenue source to bring about capital investment in the hall, supplemented by the planned disposal of a number of vacant buildings on the estate. • Planned £1.0m upgrade of play areas using Play Pathfinder grant. Housing Market Renewal since 2004 £130m+ of HMRI funding will have been invested in restructuring the housing market in Liverpool. A further tranche of funding is expected to be made available for 2009/2011, anticipated to be in the £141m. No financial gap is currently anticipated as the programme will be tailored to reflect the level of resources made available. Key priorities include: • Continued delivery of the HMRI programme, including the planned acquisition of 375 dwellings and the creation of 815 new homes (split between private and rented). Delivery however could be undermined by market and economic condition. • Potential acceleration of the housing programme in Anfield Breckfield through an asset backed vehicle with English Partnerships (now the Homes and Community Agency). Appendix 2 to MTFP CT0409 24
  25. 25. • Review of the concept plans for the four zones of opportunity to identify new/alternative housing development sites. This will include as assessment of council held assets in the areas to better join-up asset use and development opportunities. Sport & Recreation the Service is in the process of launching a new Sport and Recreation Strategy for Liverpool 2009-2013 which takes on board Sport England’s Framework for sport, PCT’s Healthy Weight Healthy Liverpool; and Liverpool Active City. This new Strategy has highlighted a number of key priorities which underpin the aspirations of the service for the next 5 years including: • Roll-out of a programme of sports centre refurbishment works to the ageing sports centre stock using revenue savings and existing repair/maintenance budgets. Planned capital schemes to enhance provision include an extension of the Park Road Gymnastics Centre with funding by the BGA into a National Centre of Excellence. • £1m refurbishment of the swimming pool changing facilities at Lifestyles Everton Park in partnership with the PCT and a £200,000 grant from the Sport England/Government Initiative ‘Free Swimming Modernisation Capital Pot’. • £1.2m refurbishment and extension of the current fitness suite at Lifestyles Ellergreen in partnership with the PCT. • Continued investment in the playing fields and refurbishment of changing pavilions as part of a review of the current playing field strategy; including £1.1m refurbishment of Heron Eccles Playing Fields with the aid of a £800,000 grant from the Football Foundation. The Strategy and future service provision will also be influenced by the health agenda for the city (in conjunction with the PCT and Liverpool First), the city’s ageing population (the implementation of a Free Swimming Programme for the over 60's and under 16's over the next three years will result in increased participation rates but also impact on service delivery due to the requirement for increased staffing levels at swimming pools, although each Authority will receive an annual revenue support contribution to off-set these costs) and the need for a stronger connection with the schools (thorough BSF, the extended school agenda) to ensure better access to leisure facilities. Libraries Whilst the library service has undertaken a refurbishment programme over the last ten years the vast majority of buildings are between 50 – 100 years old. In order to satisfy all of the different uses library buildings need to be as flexible as possible, some of which cannot be provided from the current assets. Key challenges include:- Appendix 2 to MTFP CT0409 25
  26. 26. • £49.0m upgrade of Central Library including the re-building of the Brown Library Extension and renovation of the historic fabric to the Picton Library. £44.9m is available as PFI credits and options are continued to be explored to finance the gap of £4.1m. • Following extensive consultation, pProposed new libraries arrangements at within West Derby Comprehensive School (as part of the BSF programme) (replacing existing provision at Lister Drive and Larkhill), Project Jennifer (replacing the existing library at Gt Homer Street) and Childwall School, in conjunction with the PCT (replacing Childwall Library). At present financing has only been confirmed for West Derby. Options are also being considered to co-locate Woolton Library. • £1.3m upgrade of the Toxteth Library as Community Learning and Information Hub funded by a £1.3m BLF award. How library provision will be developed and delivered in the future is likely to be influenced by a Government review of library provision nationally, which is scheduled to be completed in 2009. This will be reflected in future updates of the AMP. Youth Services the Council uses a network of accommodation in the public and voluntary sectors to deliver its youth service. New capital funding is available through the Youth Opportunity and Capital Funds, which is allocated by the young people that use the service. Whilst funding is being invested to improve a number of centres in 2009 the majority of the accommodation is in poor condition and sizeable investment is needed to make it fit for purpose. An accommodation strategy is being developed which will establish the level of funding needed and potential delivery solutions, details of which will be reported in the next iteration of the AMP Aim 3 – Empower our Residents Schools including Children’s Centres given the availability of capital funding through the sure start, building schools for the future (BSF) and primary capital programme (PCP) there is a unique opportunity to transform the quality and provision of the school estate. Key priorities are:- • successful delivery of wave 2 BSF schemes, which will see £168m of new investment (including Council funding of £8.5m) in respect of 6 secondary schools. Potential threats include the impact of the credit crunch on the sale of “surplus” schools (where the receipt is to be used to off-set prudent borrowing used to finance the Council’s contribution) and the future use of redundant school playing fields; Appendix 2 to MTFP CT0409 26
  27. 27. • securing a further £350m of capital funding through wave 6 of the BSF programme to complete the transformation of the remainder of the secondary school estate. Issues include finalising the selection and acquisition of new school sites to facilitate the co-location of schools; financing of the anticipated funding gap (to deliver necessary ancillary works) of £46m; disposal of surplus schools and redundant playing field provision (see comments above). Options to finance the funding gap include the use of prudent borrowing and capital receipts realised from the disposal of surplus schools as a consequence of the programme; • to secure Primary Capital Programme funding of £7.0m – £8.0m pa over the next 13 years from 2011/12. Potential issues are likely to include financing of additional ancillary works outside of the grant, the costs of which will not be known until the programme has been agreed; identification and approval of potential schools to co-locate and like the BSF programme the disposal of surplus schools and redundant playing field provision; • continued roll-out of a network of children’s centres across the city with a further two centres to serve Childwall, Church, Woolton and Mossley Hill, for which funding has been secured. There are no significant capital or asset management issues highlighted at present; . Supporting People – key priorities are:- The managed reduction of the hostel provision for homelessness people, rationalising unsustainable stock (three hostels, which were retained by the council) and continue the investment programme (£3.7m to date, with a further £3.0m planned) through Liverpool Mutual Homes in the remaining three hostels, as part of the stock transfer contract with them. Adult Social Care how the current portfolio of assets will be used and accessed in the future is being driven by various Government initiatives including the Personalisation Agenda where the emphasis is towards providing people with a cash sum in lieu of services, which gives them a choice of care provider. This is likely to result in further reduction in the demand and use of the Council’s premises. The impact of this will be report in future updates of the plan. Options are also been explored to transfer some of the retained tenanted residential accommodation to enable investment in the accommodation. Health Agenda the Council is exploring with the PCT the disposal/development of a number of Council owned sites to facilitate the development of a network of new medical health centres across the city. This includes the possible shared use or purchase of space to replace existing Council accommodation. Appendix 2 to MTFP CT0409 27
  28. 28. Cross-cutting themes Maintenance Backlog during the last five years there has been a steady reduction in the level of maintenance backlog in respect of the operational buildings (and schools) portfolio from £64.8m in 2003/4 down to £27.4m in 2007/08 through a mixture of targeted capital investment, pro-active planned cyclical maintenance and rationalisation of poor performing and under utilised assets. Further details in respect of this can be found under appendix C Notwithstanding that further work is need to reduce the maintenance backlog. The amount of the budget spent on reactive repairs and maintenance is disproportionate to that spent on cyclical and planned maintenance and the ratio needs to shift with greater emphasis on planned activities. In particular, adequate resources need to be made available to manage assets which have recently benefited from major capital investment. In the last three years capital funding of £1.5m has been made available to tackle maintenance backlog, while over the last 5 years £4m of capital and other funding has been made available to deal with DDA Compliance. Given the current pressures on capital receipts this is likely to be reduced in future years. Consequently alternative options are being looked at to provide other funding sources. This could include:- • re-alignment of existing repair & maintenance budgets to focus monies on areas of greatest need; • the creation of an building investment fund (financed as an invest to save initiative); • top slicing a percentage of all controllable property related budgets. As in previous years the Council will continue to challenge and rationalise surplus and under-utilised assets to reduce maintenance backlog. Disposal Programme in previous years the Council has used capital receipts to support capital investment in its assets, with in excess of £41.8m being realised in the last five years. Since January 2008 the impact of the credit crunch has started to have an affect on the disposal of surplus assets resulting in the capital receipts forecast (including the sale of former HRA assets) for 2008/09 being downgraded from £7.5m down to £5.25m. Based on recent national studies regarding the projected performance of the property markets a cautious view has been taken on the future level of “free” capital receipts (i.e. it exclude receipts to be reinvested back into specific initiatives such as BSF) which the Council could expect to rely upon as detailed below. 2009/10 £3.0m 2010/11 £3.0m Appendix 2 to MTFP CT0409 28
  29. 29. 2011/12 £3.0m This will have an impact on new projects which can be financed from capital receipts and investment is likely to be focused on existing approved commitments and key strategic initiatives which are levering in substantial capital grant such as BSF, HMR where additional funding from the Council is required. In addition, in order to maximise land values a number of disposals have been provisional “put on hold” and the sites land banked until market conditions improve. A number of operational assets are planned to be declared surplus over the next 12 months and consideration is being given to the potential demolition of the existing buildings and land banking of the sites to reduce costs, notably in relation to empty business rates, over the medium term. A business case is being developed for an invest to save scheme to finance a corporate demolition programme, in the event that a purchaser cannot be secured or an acceptable purchase price obtained. As part of this process the Council will also proactively look at and consider temporary use of these assets by the community providing the cost of managing and maintaining the asset can be borne by the community organisation(s). The planned introduction of new compulsory standards for “eco-home” is also expected to have a significant impact on the level of future capital receipts and these have been factored into key sales disposals from 2011 onwards, notably the BSF programme where the capital receipts from replaced schools is being used to support the cost of additional ancillary works outside of the BSF grant. Heritage the Council has the largest number of listed buildings and structures outside of London, many of which are in Council ownership. As a land owner the Council has a statutory responsibility to ensure they are adequately maintained. The adoption of the Council Cultural Strategy reinforces the roles these assets can play in supporting the continued renaissance/regeneration of the City. Key challenges in respect of the Council’s heritage asset will be:- • Conservation and where funding permits, restoration of heritage assets, especially those buildings identified as being at risk. Key iconic building include St. Georges Hall, Town Hall and Croxteth Hall. • Statues & Monuments – current budget provision only covers essential repair works and is insufficient to undertake a programme of refurbishment works to the council’s statues, many of which are listed. Office Accommodation (including Customer Contact) there have been a number of strategies around the provision of office accommodation and the customer contact agenda. These include: • City centre Office Accommodation Appendix 2 to MTFP CT0409 29
  30. 30. • Customer Contact – One Stop Shop Strategy • Customer Focus Centre – Support Office Strategy The aim has been to move out of poor quality accommodation and expensive leased accommodation and concentrate on improving the remaining stock of predominantly council owned buildings to provide a good quality working environment. This is reflected in the relatively low level of maintenance backlog. In order to ensure the accommodation meets the changing needs of the Council, its staff and customers it is being reviewed as part of the SIIP regarding Assets and Customers. Key areas to be reviewed to ensure an integrated approach in determine future office accommodation needs include: • Flexible working • Customer Contact • Storage & archiving arrangements • ICT • Workforce Plan • Staff travel plan • Standards for the best use of office accommodation • Duty holders / occupiers responsibilities • Neighbourhood devolution agenda A revised office accommodation strategy is due to be completed in March 2009 which will set out the parameters for the council’s standards for office use, which in turn will inform a review of the space with implementation throughout 2009/2010. As part of the next implementation phase consideration is being given to the re- use of Dyson Hall (a former young offender’s institution) as temporary office space to facilitate the release of Long Lane Depot, North House and Sefton Grange. Asset plan To plan ahead an indicative five year asset plan has been developed based on the SAMPs and the gap analysis, linking asset use and priorities back to the corporate aims and priorities – see appendix B. As indicated on the plan a number of the asset priorities are dependant on funding solutions, which has either yet to be identified or approved. Consequently the plan remains subject to change and a number of priorities are likely to be phased into future years (beyond the scope of the current plan) to ensure that the Council moves forward with a costed plan that is affordable, deliverable and achievable, which fully meets the aims and priorities of the Council and needs of the community. Appendix 2 to MTFP CT0409 30
  31. 31. STRATEGIC ACTIONS (09/10 – 11/12) • Full implementation and adoption of Tribal across the Council including web enabled access to asset data by elected members and the public – March 2010. • Continued voluntary registration of all the remaining Council’s assets with the Land Registry – 2010/11. • Finalise the updated accommodation strategy and complete the review of the operational accommodation (in line with the strategy and the agreed challenge methodology) – March 2010. • Instigate a 3-year review programme of all the Council’s asset – April 2009 to March 2011. • Commission a review of asset management planning (including capital prioritisation) by the 4Ps – Summer 2009. • Undertake an annual revision of the AMP as part of the council’s corporate business arrangements and budget setting process – annual, aligned to the timetable for the corporate service and financial planning process and MTFP. • Undertake and complete the Asset and Customer Programme review and associated projects, in particular the Asset Strategy and Building & Accommodation and implement any recommendations arising from the project – March 2009 onwards. • Agree a strategic framework (through Liverpool First) for engagement and consultation with the community on service delivery and asset use/availability – Summer 2009. • Establish an asset management forum of key public partners to explore on a regular basis the opportunities for shared and co-location of facilities, including the swapping of assets where appropriate – first meeting to take place in March 2009. • Revisit and secure formal adoption (by Member) of a Corporate Property Policy & Guidance Manual – March 2010. Appendix 2 to MTFP CT0409 31
  32. 32. GLOSSARY OF TERMS ABV - Asset Backed Vehicles AMG - Asset Management Group AMP - Asset Management Plan BACS - Bank Automated Clearing System BSF - Building Schools for the Future BU - Business Unit BVPI - Best Value Performance Indicator C & I Estate - Commercial and Investment Estate CIPFA - Chartered Institute of Public Finance & Accounting COPROP - Association of Chief Property Officers in Local Government CPA - Corporate Performance Agenda CPO - Corporate Property Officer CPP - Corporate Performance Plan CRG - Corporate Regeneration Group CFC - Customer Focus Centre DCLG - Department for the Communities and Local Government DDA - Disability Discrimination Act 1995 Defra - Department for Environment, Food & Rural Affairs FTE - Full Time Equivalent GIA - Gross Internal Area GIS - Geographical Information System GVA - Gross Value Added HCA - Homes & Communities Agency HMRI - Housing Market Renewal Initiative HRA - Housing Revenue Account ICT - Information and Communication Technology LCC - Liverpool City Council LDL - Liverpool Direct Limited LLDC - Liverpool Land and Development Company MTFP - Medium Term Financial Plan NaPPIM - National Property Performance Management Initiatives NWDA - North West Development Agency OPG - Operational property Group OSS - One Stop Shop PCT - Primary Care Trust PMU - Premises Management Unit PAMS - Property and Asset Management Services PFI - Private Finance Initiative PPI - Property Performance Indicator PPP - Public Private Partnership RSL - Registered Social Landlord RICS - Royal Institution of Chartered Surveyors RTB - Right to Buy SAMG - Strategic Asset Management Group SAMP - Service Asset Management Plans SIA - Strategic Investment Area SiiP - Strategic Innovation & Improvement Programme SPV - Special Purpose Vehicle TAMP - Transport Asset Management Plan UPRN - Unique Property Reference Number Appendix 2 to MTFP CT0409 32