CD008 - OPDC Subsidiaries Financial Management Services

1.1 As part of its Land Assembly Programme, OPDC has acquired c£200m of land 
assets, some purchased directly by OPDC and others acquired through purchasing 
the Special Purpose Vehicle (SPV) company which owned the asset. 

1.2 This has resulted in a more complex corporate structure for OPDC, which has 
added an administrative burden, increased risk of accounting error and increased 
risk of tax liability. 

1.3 Due to not having the skills and capacity in house to carry out the financial 
management of these entities, OPDC outsourced the management and financial 
accounting services for these SPVs to a third-party provider, Mercer & Hole, for the 
year which ended on 31 March 2025. 

1.4 Mercer & Hole have provided full year services for four SPVs, and have completed 
their work on time and on budget. In particular the audits, forming approximately 
50% of the expected spend, for the period ended 31 March 2025 have been 
successfully completed. We have established a bi-weekly call between OPDC and 
Mercer & Hole to ensure regular communication and early notification of any 
issues. 

1.5 In March and April 2025 OPDC acquired a further four SPVs. OPDC now intends 
to manage all eight SPVs under a single contract after running a competitive 
procurement exercise, in line with the Corporation’s Contracts and Funding Code 
and applicable procurement legislation. 

1.6For the financial period to 31 March 2025, OPDC spent £52,000 on the financial 
management for three property owning companies and one holding company. The 
additional two property owning companies and two holding companies acquired in 
March and April 2025 are expected to cost approximately £40,000, leading to a 
total annual cost of just under £100,000 for all SPVs. 

2.1 OPDC will outsource the following services: 

• Management Accounts – quarterly information for management to assess financial performance. 
• Financial Accounts – statutory requirement to prepare accounts to file at Companies House. 
• Corporation tax returns – statutory requirement to calculate and pay tax on profits earned. 
• VAT returns – statutory requirement to account for and pay VAT correctly. 
• Company secretarial – manage filings with Companies House. 
• Other ad hoc services as required 

2.2 OPDC currently does not have the internal resource to carry out these financial 
management services and having assessed options for addressing these it has 
been concluded that outsourcing will offer the most effective and best value for 
money. 

2.3 These services will be delivered over the next 5 years, on the basis of a 3-year 
initial contract with the option to extend for a further two years, if OPDC elects to 
exercise this option. 

2.4 The number of SPVs may increase or reduce over time, dependent on further land 
acquisitions and a proposed review of OPDC’s corporate structure to assess 
options for simplifying our asset ownership arrangements. Simplifying the 
corporate structure of OPDC should reduce administration costs (including on this 
procurement) and the internal management time dealing with these SPVs. 
 

3.1 The appointed provider will prepare and submit all the services listed in paragraph 
2.1 and as these are routine services for managing small companies, so we do not 
expect any issues in delivering them. 

3.2 Due to the wide range yet specific nature of the required services, it would not be 
cost effective to carry out these services in house. Professional service companies 
have a range of departments covering each individual service (accounts, VAT, 
corporation tax, company secretarial), so can access expertise at minimal cost, 
delivering value for money for OPDC. 

3.3 The costs associated with the financial management of our SPVs will be charged 
against any associated tax liabilities. 

4.1 This proposal is an important part of the effective stewardship of OPDC’s Land and 
Property assets and is required to meet the statutory obligations of OPDC and of 
its employees who are appointed as directors of the SPVs. 

4.2 The financial management of the SPVs will also simplify OPDC’s offer when 
working with developers in future years to regenerate the Old Oak area. OPDC will 
need to demonstrate that it has good financial management and control, which 
these services will help to provide. 

5.1 As part of the procurement exercise OPDC will agree clear timetables and 
deliverables for each of the services outlined in section 2.1. A monthly data share 
with the successful bidder will be established, and bi-weekly meetings will be held 
with the OPDC finance team to ensure regular communication and issues are 
raised in good time. 

5.2 The Project Lead will be the Senior Finance Business Partner and the Senior 
Responsible Officer will be the Head of Finance. Further review will take place by 
the directors of the SPVs (currently the Chief Finance Officer and Executive 
Director - Development). 

5.3 The appointed consultant’s performance will be assessed by whether the 
management and statutory deadlines are met for each SPV, in addition to 
responsiveness to ad hoc queries. At the end of the first three years, OPDC will 
decide whether to extend the contract for a further year(s). 

6.1 This work will reduce OPDC’s financial risk by ensuring each entity has strong 
financial controls in place, and accounts and tax returns are prepared and 
reviewed on a regular basis. 

6.2 This work will reduce the risk for the directors of each SPV as they will have fewer 
statutory responsibilities if the number of SPVs is reduced. 

6.3 Costs will be managed by clearly agreeing an annual fee for service set out above.

7.1 Under Section 149 of the Equality Act 2010, as a public authority, OPDC must 
have ‘due regard’ to the need to eliminate unlawful discrimination, harassment and 
victimisation as well as to the need to advance equality of opportunity and foster 
good relations between people who share a protected characteristic and those who 
do not.

7.2  The protected characteristics and groups are: age, disability, gender reassignment, pregnancy and maternity, race, gender, religion or belief, sexual orientation and marriage/ civil partnership status. Fulfilling this duty involves having due regard to: the need to remove or minimise any disadvantage suffered by those who share a protected characteristic or one that is connected to that characteristic; taking steps to meet the different needs of such people; and encouraging them to participate in public life or in any other activity where their participation is disproportionately low. Compliance with the Equality Act may involve treating people with a protected characteristic more favourably than those without the characteristic. The duty must be exercised with an open mind and at the time a Decision is taken in the exercise of the OPDC’s functions.

8.1  Strong financial management of the SPVs is integral to long-term investment 
considerations as we prepare to engage the market for partners to bring forward 
the Old Oak scheme. This will act as one of many steps that enables us to 
effectively ascertain our capacity to deliver inclusive and sustainable development. 
Social value commitments will be considered during the procurement process. 

9.1  There are no other considerations that need to be considered in the taking of this 
decision. 

10.1 No one involved in the preparation or clearance of this Form, or its substantive 
proposal, has any conflict of interest. 

11.1 Will not affect Corporate Operations bottom line budget as the costs that come in 
will be apportioned to their respective SPVs. These costs have been included in 
the asset management budget for future years. 

12.1 The foregoing sections of this report indicate that the decision requested of the 
Chief Executive Officer concern the exercise of the Authority’s general powers; 
falling within the Authority’s statutory powers to do such things considered to 
further or which are facilitative of, conducive or incidental to the promotion of 
economic development and wealth creation in Greater London; and in formulating 
the proposals in respect of which a decision is sought officers have complied with 
the Authority’s related statutory duties to: 

• pay due regard to the principle that there should be equality of opportunity for all people; 
• consider how the proposals will promote the improvement of health of persons, health inequalities between persons and to contribute towards the achievement of sustainable development in the United Kingdom; and 
• consult with appropriate bodies. 

12.2  In taking the decisions requested, the Chief Executive Officer must have due regard to the Public Sector Equality Duty; namely the need to eliminate discrimination, harassment, victimisation and any other conduct prohibited by the Equality Act 2010, and to advance equality of opportunity between persons who share a relevant protected characteristic ( age; disability; gender reassignment; marriage and civil partnership; pregnancy and maternity; race; religion or belief; sex; sexual orientation) and persons who do not share it and foster good relations between persons who share a relevant protected characteristic and persons who do not share it (section 149 of the Equality Act 2010). To this end, the Chief Executive Officer should have particular regard to section 7 (above) of this report. 

12.3 All procurements of works, services and supplies required for the project must be 
procured in accordance with the Authority’s Contracts and Funding Code (the “Code”) and, where the value exceeds £150,000, in accordance with the Procurement Act 2023. Furthermore, the officers must liaise with Transport for London’s procurement and supply chain team, which will determine the detail of the procurement strategy to be adopted in accordance with the Code and the Procurement Act 2023. Officers must ensure that appropriate contractual documentation be put in place and executed by chosen service provider/supplier and the Authority before the commencement of the attendant services.