The Chair reminded Commission Members that this meeting is not to take a second look at a decision made by Cabinet. It is rather to decide whether the decision taken is in accordance with our principles of decision making. In this case the challenge is that the decision taken has not been proportional to the desired outcome, is a presumption in favour of openness and there has been no consideration of alternatives.
Councillor Ed Gretton was invited to introduce the key points described in the call-in form;
The Head of Regeneration, commented that the clawback is a suspension and not a waiver. There is a mechanism in place that if the project breaks even the clawback will be repaid. We have a robust analysis that will be refreshed. Viability assessments are refreshed and will need to be refreshed annually for the duration of the project.
In response to questions from Members of the Commission, the Head of Future Merton and James Kinnersly from SQW explained;
The financial model used at that time was in line with government guidance and policy and GLA guidance and policy. Merton has no control over how Clarion finance but it is worth noting that that Industry standard for development finance would be 6-7%. 5% is competitive.
Stock transfer agreement had a number of controllable mechanisms
for decent homes standard. Amendments were not sought. Obligation
for delivery of decent homes either via refurbishment or estate
regenerations through new builds.
The Chair asked Members to consider the information provided in response to the call-in request and decide whether or not to refer back to Cabinet for reconsideration.
Cllr Nick McLean moved that the Commission refer the matter back to Cabinet due to the issues of proportionality and complexity. The matter only appeared at scrutiny a few days before Cabinet and it needs to be looked at again and reviewed. This was seconded by Cllr Paul Kohler.
Vote: Three Members voted in favour, six against with one abstention.
Therefore the matter will not be referred back to Cabinet and the decision shall take effect immediately.