The Executive Director (Development) has submitted a report to seek a budget to allow the City Council to lend OxWED up to £750,000 to support continuing work on the Oxpens project and in particular preparing (and subject to LLP Member approval and planning permission) implementing the Delivery Strategy for the Oxpens development.

Cabinet is recommended to:

1.       Recommend to Council that it includes £750,000 in its capital budget to allow the City Council to loan these funds to OXWED to continue work on the Oxpens project in accordance with the LLP Members agreement, and in particular preparation and (if planning permission is granted) implementation of the Delivery Strategy; and

2.       Delegate authority to the Head of Financial Services / S151 Officer in consultation with the Deputy Leader (Statutory) – Finance and Asset Management to agree terms and draw down the up to £750,000 loan to OxWED.

The Executive Director (Development) had submitted a report to seek a budget to allow the City Council to lend OxWED up to £750,000 to support continuing work on the Oxpens project, and in particular preparing (and subject to LLP Member approval and planning permission) implementing the Delivery Strategy for the Oxpens development.

Councillor Ed Turner, Cabinet Member for Finance and Asset Management, clarified that OxWED was jointly financed by the Council and its partner, Nuffield College.  The Council lent money to OxWED for a return which would be repaid from the development.  The money was being lent in stages rather than all at once, and Cabinet was therefore asked to consider recommending that Council make provision within its capital budget of £750,000 to finance a loan to OxWED towards the delivery of the development.  A proposal for a further £3.1m to be added to the capital programme from 2023/24 to cover the delivery of future enabling works and additional land assembly work was included in the budget: this would be the subject of a separate report to Cabinet later in the year.

Councillor Turner cautioned that failure to approve the budget provision for the loan would result either in an unbalanced partnership arrangement with its partner Nuffield College, or a need for the site to be delivered in a very different way. 

In response to a point that the economic climate had changed significantly since OxWED was established in 2016, and a question as to whether the business case remained viable, it was noted that the planning application retained flexibility for a variety of different uses and delivery timescales.  The mix of uses on the site which would have been most profitable in 2016 was not the same as it was today, nor the same as it would be in two years’ time.  The production of the delivery strategy would provide the most up to date information as to whether the business case remained sound, and would provide the shareholder with options in relation to the various risks and rewards of the project.

Cabinet resolved to:

1.       Recommend to Council that it includes £750,000 in its capital budget to allow the City Council to loan these funds to OXWED to continue work on the Oxpens project in accordance with the LLP Members agreement, and in particular preparation and (if planning permission is granted) implementation of the Delivery Strategy; and

2.       Delegate authority to the Head of Financial Services / S151 Officer in consultation with the Deputy Leader (Statutory) – Finance and Asset Management to agree terms and draw down the up to £750,000 loan to OxWED.