Contact: Christine Buckett, ext 7313 and Nicky Pendleton Partnership Manager (South East) 01329 824121

1 Summary

1.1 The purpose of the report is to explain the background to the LIFT Project (Local Improvement Finance Trust) and the current position, and to obtain delegated authority to enter into agreements to enable financial close on the LIFT project by negotiating and finalising documents, and completing the transaction.

1.2 Due to the requirements of the financial institutions involved in the LIFT project this report is set out in a format based on LIFT standard documentation which has been agreed by all participating authorities. In particular the recommendation takes a more detailed and prescriptive form than normal.

2 BACKGROUND

In November 2002 the Executive Member for Social Care received a report on the Local Improvement Finance Trust (LIFT) that was being developed for the East Hampshire and Fareham and Gosport Primary Care Trusts. At that time it was agreed to support LIFT on the basis of a level 2 Commitment without exclusivity. This meant that the council was willing in principle to sign up to the LIFT partnership on that basis through the Strategic Partnering Agreement.

It was recognised that the LIFT programme could assist in supporting the county council priorities of Maximising Life Opportunities and Improving Services.

Since that decision the LIFT partnership has progressed effectively to develop the first phase of a programme of health and social care capital projects. These include a childrens centre in Havant, a community hospital in Havant, and primary care centres in Cowplain and Rowner.

2.1 The Council's representative on the LIFT Project Board has participated in the decision to select the preferred partner for the HM Government NHS LIFT scheme to establish a long term partnership with the East Hampshire Primary Care Trust, Fareham & Gosport Primary Care Trust, the Winchester City Council, Fareham Borough Council, Gosport Borough Council, Havant Borough Council and East Hampshire District Council (together "the Other Participants"), and a joint venture company formed for the Project ("LIFTCo") by Community Solutions for Primary Care Limited.

2.2 LIFTCo may provide and/or procure partnering services and new and improved facilities and accommodation to the Council and/or the Other Participants if and to the extent requested by the Council and the Other Participants and others involved in providing health and social care in the area within the County of Hampshire, Winchester City Council, East Hampshire District Council, and the Boroughs of, Fareham, Gosport and Havant ("the project")

3 The Strategic Partnering Agreement and other documents

3.1 The Strategic Partnering Agreement(referred to henceforth as the "Transaction Document") sets out the contractual relationship between the participating authorities and LIFTCo. The Transaction Document provides a framework within which LIFTCo would provide partnering services to the Council should it be requested to do so. The Council should note that entering into the Transaction Document does not oblige the Council to employ LIFTCo to provide any partnering services. Should the Council at any future time require LIFTCo to provide any partnering services, such a decision would be subject to the normal procurement requirements of the Council and to the Council entering into further agreements.

3.2 The latest version of the Transaction Document has been reviewed and agreed by officers who are recommending that the Council can now approve it in its current form. However negotiations will continue through to financial close on the final wording of the Transaction Document and delegated authority is required to enable officers to agree changes.

3.3 Cabinet should note the position in relation to other agreements, deeds, notices, forms, letters or other documents ("the Additional Documents") which might require signature on behalf of the Council in order for the Project to reach completion but which have not yet been drafted.

4 Powers to enter into the Project and transaction documents

4.1 The Council has general powers specified in Section 2 of the Local Government Act 2000 to promote the economic, social and environmental well being of its area;

4.2 Section 1 of the Local Government (Contracts) Act 1997 empowers the Council to enter into contracts for the provision or making available of services and/assets (such as the Strategic Partnering Agreement) with other persons for the purposes of the discharge of its functions imposed or conferred upon it by statutory provisions such as those referred to in the foregoing paragraphs;

4.3 Section 111 of the Local Government Act 1972 gives the Council the power to do anything calculated to facilitate, or that is conducive or incidental to the discharge of any of its functions;

4.4 The Council has an obligation to carry out its functions effectively, efficiently and economically;

4.5 The Council has an obligation to comply with its statutory duties.

4.6 Officers have concluded (having considered, inter alia, the type and nature of the Council's own funding arrangements) that:

4.6.1 entering into the Transaction Document will facilitate the Council in discharging its functions, in particular by providing an opportunity to:

o promote the economic, social and environmental well being of its area; and

o carry out its functions effectively, efficiently and economically;

and that:

4.6.2 it is within the powers and in the best interests of the Council to enter into:

o the proposed Project;

o the Transaction Document (on the terms currently set out in the Transaction Document produced to the Executive Member; subject to such amendments as may be approved in accordance with the recommendation below); and

o such Additional Documents as to be negotiated and agreed by the authorised officers of the Council for the time being (subject to such amendments as may be approved in accordance with the recommendation below).

4.7 The Council's Constitution requires that any contract entered into on the Council's behalf in the performance of an Executive function, must be signed by the Head of Corporate and Legal Services, or any other person authorised by the Head of Corporate and Legal Services; or such contracts must be made under the Common Seal of the Council and witnessed by the Head of Corporate and Legal Services (or any other person specifically authorised to sign on his or her behalf). Any contract over a value of £75,000 which is not under seal must be signed by the Head of Corporate and Legal Services (or any other person authorised by the Head of Corporate and Legal Services) and one other person also authorised to do so by the Head of Corporate and Legal Services. As to the extent of liability of the Council under the Transaction Document or any other Additional Documents will be less than £10,000, the head of Corporate and Legal Services has confirmed that the Transaction Document or any other Additional Documents may be signed by one authorised officer.

5 RECOMMENDATIONS

5.1 That the terms of the transactions contemplated by the Transaction Document are approved in accordance with the Council's Constitution and the Additional Documents and any ancillary or related documents to which the Council is expressed to be a party are resolved to be approved under paragraph 4 above and in accordance with the Council's Constitution and that all such documents (with such amendments as may be made and agreed and approved by the action of execution in accordance with these resolutions) and all such ancillary or related documents be executed, delivered and performed on behalf of the Council;

5.2 That authority be given to one of the Chief Executive, the Head of Corporate and Legal Services, the Head of the Legal Practice, the Property and Litigation Manager (Legal Practice) and Senior Solicitor (Legal Practice) to approve sign and/or dispatch and/or deliver the Transaction Document, the Additional Documents and all other documents and/or notices to be approved, signed and/or dispatched or delivered by the Council under/or in connection with the documents listed above and, by the act of so doing, to agree and approve any amendments made to such document;

5.3 That the Head of Corporate and Legal Services be authorised to certify the names and signatures of the authorised signatories set out in paragraph 5.1.2 above.

5.4 That the Director of Social Services has delegated authority to approve decisions made on behalf of the County Council at the Strategic Partnering Board.

Section 100 D - Local Government Act 1972 - Background Documents

The following documents disclose facts or matters on which this report, or an important part of it, is based and has been relied upon to a material extent in the preparation of this report.

NB the list excludes:

1. Published works

2. Documents which disclose exempt or confidential information as defined in the Act