DD1371 Mayor’s Regeneration Fund – Extension of funding period 2015/16

Type of decision: 
Director's decision
Code: 
DD1371
Date signed: 
30 September 2015
Decision by: 
Fiona Fletcher-Smith, Executive Director of Development, Enterprise and Environment

Executive summary

Formal approval is required for the continuation of projects funded by the Mayor’s Regeneration Fund (MRF) and London Enterprise Fund (LEF) into the 2015/16 financial year and further re-profiling into 2016/17 of funding associated with Gateway to Peckham: This follows approval in principle by IPB and corporate approval for the carry forward of programme budget.

In all cases with the exception of one, the continuation of projects is in accordance with original project scope where approval provides for an extension of the delivery into 2015/16, from the original approval of 2014/15. The exception is the Gateway to Peckham Project which seeks approval for further re-profiling beyond 2015/16 into 2016/17.

Approval is therefore sought for the execution of 15 variation agreements (refer to appendix 1) to ensure that Grant Agreements be aligned with the proposed project continuations. This is a request for budgetary re-profiling and is not a request for additional funding.

All other MRF / LEF projects continue to deliver within the relevant timescales stipulated within approvals.

Decision

That the Executive Director – Development, Enterprise & Environment approves:

1)    The extension of funding period into 2015/16 for the stated MRF / LEF projects in appendix 1 with an aggregate value of £15,220,474.14 capital and £1,120,779.08 revenue, with £2,468,847.00 capital of this continuing into 2016/17.

2)    The provision of fifteen variation Grant Agreements (please refer to appendix 1) to reflect the continuation of projects.

Part 1: Non-confidential facts and advice

Introduction and background

1.1    £70m funding was made available via the Mayor’s Regeneration Programme following unprecedented levels of public disorder in several locations across London in August 2011.

1.2    Work was undertaken to prioritise the Boroughs most in need of support following analysis to identify those areas worst affected by the riots and which had the highest potential for sustained growth from investment.

1.3    Under MD895, the Mayor approved the funding streams for post- riot interventions, the proposed governance arrangements and delegated decision making on detailed allocation of programme budget to the then Director of Development and Environment. MD1092 approved a revised funding profile for the programme enabling delivery up until the end of the 2016/17 financial year.

In September 2013, IPB was presented with a paper that forewarned of the likely slippage in delivery     of the MRF programmes initially intended to complete at the end of the 2013/14 financial year.      The Board acknowledged that MD1092 allows the Executive Director Development, Enterprise &     Environment to determine what constitutes significant variation with regards re-profiling decisions.     Appropriate action plans and budget carry forwards subject to the GLA’s annual budget setting     process were approved. 

1.4    Some MRF / LEF projects have Grant Agreements which ended in March 2015; these projects are the subject of this decision.

1.5    Gateway to Peckham (Peckham Rye Station) – Due to project re-scoping, formal approval is now required for the extension into 2016-17. Funding required year by year is now £2,686,158 in 2015-16 and £2,468,847 in 2016-17. The project will create a centre piece for the Peckham Regeneration programme and will see the creation of a new square that will provide an improved setting to highlight the high quality heritage asset that is the station building and provide better access to meet the high usage demands of the station which has seen a significant rise in users; a result of the arrival of London Overground.

1.6    Rigorous project and programme management controls have been used to monitor projects where a period of potential continued delivery was identified. In all cases, decisions to extend project timescales where warranted have been based on an assessment of impact on the quality of outputs and outcomes and of deliverability. Requests for 15 MRF / LEF project extensions where approvals expired at end 2014/15 were put to the Regeneration Programme Board in March 2015. The Board approved the requests in principle subject to the GLA’s formal budget setting process.

Objectives and expected outcomes

2.1    Approval is now sought to enter into re-profiled Grant Agreements, which will include robust and deliverable project plans which correspond to the extended delivery timeframes. Equally, revised Grant Agreements will include new output and funding profiles and milestones. This process will ensure that the delivery of projects continues in accordance with the proposal for which funding was originally awarded and that a high quality of output and outcomes are delivered.

2.2    Budget re-profiling for other MRF / LEF projects has been subject to the GLA’s formal budget setting process but continue to deliver within the lifetime of existing approvals.

Equality comments

3.1     All GLA Grant Agreements stipulate that, in the delivery of MRF / LEF funds, the delivery partner must adhere to the duties set out in the Equality Act.

3.2     A majority of projects include elements of physical works to the public realm in town centres. Through the GLAs design dialogue process with delivery partners, inclusive design principles are adhered to, ensuring the delivery of better public facilities. 

Other considerations

a)    Key risks and issues
Financial: There is a possibility that the projects will underspend and the full fund will not get disbursed to the London boroughs.  This will be mitigated by revised, well-defined project schedules articulating clear, timely and achievable milestones.

Outputs:  There is a risk that the some of the projects fail to deliver the outputs and outcomes they have signed up to.  This has been mitigated by the production of a guidance paper on economic uplift and a toolkit for delivery partners to apply.   This guidance and toolkit has been designed alongside colleagues in finance, governance and GLA Economics and disseminated to boroughs.  Effective monthly monitoring with each borough is identifying early on if projects are not going to deliver, and agree changes to the project or funding as relevant to maintain value for money.  The GLA have also commissioned external consultants to provide ongoing support to delivery partners in developing their self-evaluation templates and to plug any gaps they may have in their baselines data.

KPIs: Delivery partners fail to secure or realise committed match funding.  Funding agreements have required certification by the borough s.151 officer that match funding is committed via schedule 9 of the grant agreement.  The GLA have been seeking assurances from s151 officers as part of each quarterly grant claim return that match funds have been spent as outlined in the project milestones.  This will continue and the re-profiling of agreements will only be signed off once delivery partners have re-profiled any match expenditure to align with the re-profile of GLA monies.

b)    Links to Mayoral strategies and priorities

London’s town centres, including many of its high streets, are a key spatial priority of the London Plan, providing access to a range of services and enabling all parts of London to contribute to London’s economic success. The continued delivery of the OLF will support and help deliver the aspirations of the London Plan and the Mayor’s Economic Development Strategy.

c)    Impact assessments and consultations

Requests for extension have been rigorous assessed and monitored by officers in the Regeneration Unit. The extension requests have been presented to and approved by the Regeneration Programme Board.

 

Financial comments

5.1    Approval is sought for the continued delivery into 2015/16 of fifteen Mayor’s Regeneration Fund / London Enterprise Fund projects, with one continuing into 2016/17; the funding of which will be contained within the existing Regeneration funds.

 

Planned delivery approach and next steps

Activity

Timeline

Execution of re-profiled grant agreements

September 2015

Processing of Q1 2014/15 claims

September 2015

Monitoring of project progress

Ongoing

Project self-evaluation activity

Upon individual project completion

Appendices and supporting papers

Appendix 1 - List of variation agreements (included with signed decison form)