Property Context
Report 2009
Hertfordshire Property
01438 737400
www.hertsdirect.org
Fundamental
aim of the
county council
Corporate
Property Vision
& Corporate
Property
Objectives
Property
Performance
Report
Property Plan
The Corporate
Plan
Property
Business
Context
Report
Other plans
& factors
(this document)
Property
Programmes
Capital - the property part.
Property Planned Maintenance.
Energy & Water Conservation.
Corporate Review.
Disposals.
he following will be available on connect under Property /What we do / Property Work / Asset Planning:
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The Property Programmes - except for the Disposals Programme which is commercially confidential.
The Property Performance Report.
The Property Business Context Report.
The Property Plan.
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Contents
CONTENTS ......................................................................................................................................................................................... 2
CONTEXT 1 - DELIVERING VALUE FOR MONEY ............................................................................................................................ 3
CONTEXT 2 - THE WAY WE WORK .................................................................................................................................................. 4
CONTEXT 3 - RESOURCES ............................................................................................................................................................... 5
CONTEXT 4 - FUNDING FOR SCHOOL BUILDINGS ........................................................................................................................ 6
CONTEXT 5 - DEMOGRAPHIC CHANGE .......................................................................................................................................... 7
CONTEXT 6 – CLIMATE CHANGE AND CARBON REDUCTION ..................................................................................................... 8
CONTEXT 7 - FIRE SAFETY AND SPRINKLERS ............................................................................................................................. 9
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Context 1 - Delivering Value for Money
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We need to ensure that our property is appropriate to meet the needs of service delivery.
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We need to ensure that our property decisions are well founded & effectively implemented.
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We need to ensure that our property services are economic, efficient and effective.
Implications
A. Expectation of continuous change - with consequences for in-house staff and the users and providers of property services.
B. Need to develop a culture of performance, business improvement and reduction of bureaucracy rather than just adhoc or
opportunistic change.
C. Need to take maximum advantage of partnership working to improve value for money eg: BSF
Recent and current actions
1. Framework for construction contracts over £150k covering all of East of England through SmarteEast partnership with Essex
and Suffolk County Councils
2. New integrated asset management system for all services out to retender for 2009/12
3. Partnering performance based property services contracts extended to 2012 for consultants.
Items for the Property Plan
A. Place more property services activity with the contracted providers with the aim of further efficiencies
B. Implement, using risk analysis, whole life appraisal for projects to achieve sustainable investment
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Context 2 - The Way We Work
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Through The Way We Work Project we are improving access to our services and creating more seamless customer-focussed
services through new technology (the customer call centre, Herts Direct and SAP enterprise wide management information) and
by other new ways of working.
Implications
A. Matching office and service delivery accommodation to the new ways we work.
B. Raising capital from the disposal of inappropriate property to fund changes to services and property.
Recent and current actions
1. Implementation of the office rationalisation project: 51 sites to 3 with a 20% reduction in NIA floor space. Phase 1 completed at
Apsley, Phase 2, Stevenage Robertson and Farnham completed 2008 and County hall completed January 2009. Sales of old
sites slowed in recession.
2. Activity based property review in settlements – e.g. schools assets in communities from BSF
3. Pathfinder community asset reviews – planned for North Herts, others in consideration
Items for the Property Plan
A. Trends and opportunities for further outsourcing if cost effective.
B. Additional opportunities to rationalise the property portfolio whilst working with pathfinder projects
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Context 3 - Resources
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The recession and the ‘credit crunch ‘
HCC capital investment is supported by capital receipts that are reducing
Government has plans in 2009/2010 to introduce a Community Infrastructure Levy which would reduce the benefit of the
Planning Obligations S106 monies.
Efficiency target = 3% cashable
Community asset transfers – Quirk report as implemented by DCLG
New CAA audit inspection regime
Implications
A. The need to rebuild to a substantial level of receipts. Reduced to £15 million or less average [from £42 million average] over next
3 years. This includes the assets released as part of the office scheme. Likelihood is that council disposals will go slower and at
lower values.
B. The switch to largely unsupported borrowing means a rising impact on affordability of capital schemes
C. Impact of transfer of community assets - low at present
D. Financial situation 'credit crunch', could lead to increased demand on council services and may mean increased unforeseen
demand for accommodation
E. New Key Line of Enquiry (KLOE) for best use of assets from a community use aspect
Recent and current actions
1. All our property partnership consultancy contracts and the SmarteEast Partnership have efficiency targets and incentives built in
which are being achieved. Price inflation is expected to reduce to 0% in 2009. Some tenders for works that start and finish in
2009 are showing reductions in the order of 5%.
2. Other procurement affecting property costs for 2009 include
 replacement of the maintenance contracts for December 2009
 energy provision for September 2009 with reduced prospects for increases at around 50%
Items for the Property Plan
A. Affordability of schemes requiring capital to be further challenged – look for non capital intensive solutions.
B. Review the target for average capital receipts in the light of the recession.
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Context 4 - Funding for school buildings
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The ‘Building Schools for the Future’ [BSF] initiative aims to replace or renew all secondary schools. The council has been
approved for funds under the scheme. These will be available from 2009 in annual programmes of £140 million or so based on
detailed business cases. The first area is Stevenage.
The national Primary Capital Programme was launched in March 2006 with the aim to rebuild, remodel or refurbish 50% of all
primary schools. It is a 15 year programme with £7 billion funding. The council was awarded pathfinder status for up to £6
million in 2007/08.
Extended services programme and Children’s Centres
Implications
A. Central government expect local authorities and schools to plan their investment over three years.
B. Implementation for secondary schools to be through a nationally prescribed LEP specialist joint venture company model. During
2009.
Recent and current actions
1. The business case for the Stevenage area is with government for approval and procurement of the LEP during 2009.
Items for the Property Plan
A. Finding the best way to maximise central government funds in to the ageing council school stock most of which is system built
and over 40 years old.
B. Implement BSF and PCP
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Context 5 - Demographic change
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Interim forecasts show that the overall population will rise from 1.077m in 2009 to 1.114m by 2021, and 1.118m by 2031, an
increase roughly equivalent to a district population the size of Welwyn-Hatfield by 2031.
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The forecasts for the Hertfordshire population overall indicate the following changes in certain key age groups between 2009
and 2031:
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School age (5- 18) 178500 (16.6% of the population) to 183000 (15.5% of the population) ( a change of -1.1 %)
50 to 74 age range 281500 (26.2%.) to 341000 (28.8%.) (+2.6%.)
over 75s
84000 ( 7.8%.) to 104500 (8.8%) ( +1%)
over 90s
9500 (0.88%) to 12000 (1.0%) (+0.12%)
Implications
A. The population is aging and so more resources will be needed for the over 50s in the medium term, and big implications for
the over 75s in the longer term. This will affect the type and distribution of services required to support them. This may have
an impact on our property needs.
Recent and current actions
1. The movement from extended care to extra care in the community for elderly and people with learning difficulties.
2. Examples are summarised in the Services Property Priorities section of the property performance plan 2009
Items for the Property Plan
A. Are the priorities from service change adequately included in the Services Property Priorities and reflected in the Property Plan
2009?
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Context 6 – Climate Change and Carbon Reduction
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New emphasis in the Corporate Plan 2009
Target of 25% CO2 reduction by 2014 most of which is emitted from property
New government department for climate change – Dept for Energy and Climate Change [DECC}
New Carbon trading scheme from 2011
New waste to heat PFI proposal over next 4 years
New National Performance Indicator
Implications
A.
B.
C.
D.
Mitigation works required across the portfolio to meet local and government targets. This includes schools.
Carbon trading effect is not yet known
Adaptation to the inevitable effects of global warming ie more potential for extreme weather and floods
Annual reporting of emissions under NI198
Recent and current actions
1. Climate Change Board set up and Deputy leader is the champion for carbon reduction
2. Switch over to smart digital metering through the council’s Optimal contract has enabled savings and reductions of energy
consumption through better on line management, though take up is slower than expected.
3. Display energy certificates point to energy inefficient buildings / operations and are used to prioritise investment plans
4. Howe Dell primary school showcases and trials different building and energy saving techniques.
5. Matched funding for projects that reduce emissions has been made to Salix [Carbon trust]. An additional £1 million p.a.
investment that pays back and becomes a revolving fund may be available in 2009/10.
Items for the Property Plan
A.
B.
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25% reduction in CO2 emissions for 2014
Next steps to achieve more than 25%?
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Context 7 - Fire Safety and sprinklers
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DCSF national guidance in BB 100 about fire safety assessments and sprinklers. Sprinklers are preferred for new build schools
according to the Minister of State for Education.
Recent fire loss of Hillmead primary school in December 2008
Implications
A. Council has a practice of installing sprinklers into new buildings, however acquired, and significant refurbishments
since 2003. Exceptions to this approach are to be authorised by the County Property Officer.
B. All projects requiring building regulation approval must meet stringent checks to ensure means of escape
C. The council ensures an appropriate fire safety risk assessment and maintains fire management plans for all of its
property where it is the responsible party, similar actions apply in schools.
D. Sprinkler systems may cost 5% of total cost on new build and considerably more on refurbishments. Implications for
the BSF programme.
Recent and current actions
1. Assessment of the cost / benefit of sprinkler installation is required on all new build and significant refurbishments.
Government have published a method for carrying this out.
2. Further research on applicable standards particularly plastic based pipe systems is underway
Items for the Property Plan
A. Revisit the guidance in the light of recent advice on schools and report on revised policies and best practice to the policy and
resources panel to set out the council’s policy
B. Report on the standards to be applied and the applicability of plastic pipe as an alternative to steel in certain situations
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