Other public agencies will ‘wish they did what we did’ during period of low interest rates, says council’s regeneration lead
Barking and Dagenham’s wholly-owned regeneration agency has reduced its forecast for delivery for the coming years, documents presented to the council’s cabinet show.
On Monday, the local authority voted to adopt an addendum to the business plan for Be First, which a year ago announced a move away from its previous reliance on council funding and direct delivery.
The business plan and addendum themselves were withheld from publication, but council documents relating to them explained that “a business model that relies on Council investment in new build schemes is no longer viable due to the inability of the Council to continue to borrow at the pace that it has over recent years”.
“The plan therefore introduces a greater focus on working with private sector partners to fund new developments and a much stronger role for Be First in supporting the Council to extract best value from its own assets,” it said.
Speaking during a short discussion of the agenda item on Monday, Cameron Geddes, cabinet member for regeneration & economic development, said that the council and Be First had for years “exploited” very low interest rates, but that “those days are over for the foreseeable future”.
“I reckon in 5, 10, 15 years time, there are going to be very many public agencies that are going to look back and really wish they’d done what we did at the time,” he added.
With rates no longer so low, he said, Be First would need to “look towards getting partners” and said that there had been “an encouraging response” from these efforts so far.
Documents published ahead of the cabinet meeting showed that Be First’s anticipated delivery numbers for the period to 2030/31 had been scaled back from 4,550 to 4,156.
Council documents said this new figure was “grounded on a clear programme of sites and their capacities and whilst offering a slightly lower commitment it sets a more realistic baseline for performance management of the company.”
A spokesperson said that the adjustment did not reflect a reduction in “ambition or ability to deliver” but Be First’s “increased levels of confidence and specificity of sites” within its work programme.
The documents also show that a ‘red risk rating’ has been assigned to 51% of Be First’s revenues across the period.
“Be First will need to have management action if the revenues are not met,” it said. “The Council’s overall General Fund position moving forward means that no additional revenue support will be available.”
A spokesperson for Be First said that revenues relating to early stages of development “naturally attract a higher risk rating, although significant progress continues to be made with respect to securing Public-Private Investment Partnerships and ultimately achieving the objectives set out within the Strategic Plan”.
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