Shopping centre, crematorium, housing company – these are three commercial enterprises adopted by Wealden Council, and more are on the way.
The council is instilling a ‘commercial culture’ among its staff and members, and training them to ensure they have the skills and expertise to make a success of commercialisation.
Risks will be taken on informed decisions and exit strategies put in place to ensure the council can pull out of projects that may not deliver expected outcomes.
The council’s commercial strategy encourages “an appetite for calculated risk taking, and embracing the learning from initiatives that fail to achieve expected outcomes.”
The strategy is contained in a document which says: “Local authorities are historically risk averse, as they are responsible for taxpayers’ money and are democratically held to account for their actions.
“However, if we do nothing to increase our income, the services we provide for our residents will be unsustainable at current levels.”
A revenue support grant, given by the Government to Wealden, was £2.3 million in 2015/16. It reduced to £288,000 in 2016/17, and by 2020 will cease altogether. (At the same time Wealden grants to Uckfield Town Council are reducing. This year the council received £22,600. Next year it will receive £14,100.)
Wealden responded early to the threat to its finances by introducing a transformation programme which saved £13 million. The programme included consolidating its offices on one site in Hailsham, instead of being split on two sites in Hailsham and Crowborough.
As the grants cuts continue the council says that transferring funds from its reserves and passing on the entirety of the burden to the taxpayer is both ‘undesirable and unsustainable in the long term’.
It says more than a third of councils are now using entrepreneurial methods to raise funds in areas such as waste, leisure and tourism, IT/back office and housing.
The strategy document says: “Most authorities, including Wealden, conduct their commercial activity locally to provide community, environmental and economic benefits for the local population.”
But some operate outside their areas in order to generate income, such as Kent County Council’s commercial subsidiary which trades with customers in the Channel Islands, and local authorities in Warrington, Thurrock and Newham which invested in bonds in the Swindon Solar Park.
Wealden says two of its ventures – the crematorium and housing company – have found gaps in the market to meet previously unmet needs of residents.
“The crematorium will provide a service that hasn’t previously been available in the district, while the housing company will develop more affordable housing for first-time buyers and older people looking to downsize.”
The council adds: “Through adopting a more commercial approach, there is potential to generate additional disposable income to contribute to achieving the council’s ambition of delivering economic development and town centre regeneration in Wealden.”
The council has identified potential income-generating projects in its strategy. They include:
- Green energy, eg developing a solar farm
- Robin Hood-style energy project (assist local people with securing reduced energy tariffs
- Health infrastructure (access to good healthcare)
- Digital advertising
- Debt recovery service for East Sussex Councils
- Provision of public Wi-Fi and small cell deployment
- Building Control Company
The council says it will keep an eye out for new opportunities which may help bridge the funding gap and maintain its ‘high standard of service provision’.
Read more about Hailsham shopping centre which has been taken over by the council here: Wealden Council spends more than £12m on shopping centre.
There’s more about progress on building a crematorium in the district here: Work under way on crematorium for Wealden.
The council’s housing company is Sussex Weald Homes which aims develop more affordable housing for first-time buyers and older people looking to downsize.
It is planning to build 34 homes at a former depot site in Jarvis Brook, Crowborough by mid-2019 and is looking to acquire other sites across Wealden at Crowborough, Hailsham, Heathfield, and Lower Dicker.