This item includes exempt information pursuant to Paragraph 3 of Part 1 of Schedule 12A of the Local Government Act 1972. It will be necessary for the Panel to pass a resolution to exclude the press and public from the meeting during consideration of this item (as set out at agenda item 4).

The Shareholder and Joint Venture Group, at its meeting on 02 September 2024, will consider a report from Oxford Direct Services (ODS) relating to ODS Group Performance.

Simon Howick, Managing Director (ODS) has been invited to present the report and answer questions from the perspective of ODS.

Cllr Nigel Chapman, Cabinet Member for Citizen Focused Services and Council Companies, Emma Jackman, Head of Law and Governance and Nigel Kennedy, Head of Financial Services have been invited to present the report and answer questions from the perspective of the Council as Shareholder.

The Panel is asked to consider the report and agree any recommendations.

Simon Howick, Managing Director (ODS) introduced the report, which provided an end of year summary for the trading period 2023/24, including the expected timeframes for any declaration of dividend and an outline of progress on growing the commercial business (ODSTL).

In response to questions, the Panel was advised that:

·       The reality of running a commercial business required a degree of certainty in order to make budget assumptions, which did not necessarily always align smoothly with the Council’s processes to meet the requirement to get best value for its work programmes.

·       ODS was experiencing some challenges in relation to gaining certainty from the Council in relation to allocation of full-year budgets and work programmes.

·       The Council was in the process of moving towards a more proactive, planned approach to its various work programmes involving ODS, rather than the more reactive approach which was currently employed. However, this would take some time and would impact ODS business modelling during the transition period.

·       A meeting was due to take place in September 2024 between Council and ODS representatives to discuss any required changes to the approach to green space management, including grass cutting.

·       The Medium Term Financial Plan (MTFP) included savings targets related to the services provided by ODS; these targets were required to be achieved in order for the MTFP to be balanced. A strategic review of services provided by ODS was currently underway and its conclusions would be reported in due course.

·       Council work programme slippage was usually as a result of factors outside of the Council’s control.

·       There was work ongoing through the strategic review of services provided by ODS and the ODS Clienting & Commissioning Review which would seek to address some of the issues set out in the report.

·       As a ‘Teckal’ company, a minimum of 80% of ODS’ work was required to be undertaken for the Council; ODS could only undertake a maximum of 20% non-Council work. ODSTL was a commercial company (i.e. not a ‘Teckal’ company) and so different rules applied.

·       The Managing Director (ODS) would provide written responses to the questions which the Chair had sent in advance; these would be shared with the Panel for information.

The Panel agreed to recommend that:

1.    The Council improves forecasting of its quarterly financial reports and the evolving Medium Term Financial Plan, to include regular quarterly modelling and risk analysis related to the impact of changed spending profiles of the Council’s General Fund and Housing Revenue Account (General Fund and Capital) on the services provided by all wholly-owned Council companies – and their revenues and ability to pay dividends to the Council.

2.    The Shareholder and Joint Venture Group requests a fuller update from ODS setting out the key risks relating to ODS’ solvency and profitability, including best estimate numbers and timescales to enable the full scale of the problem to be understood relative to the savings targets – and shares this update with the Panel once available.

Simon Howick, Managing Director (ODS) and Paul Concannon, Chief Operating Officer (ODS) left the meeting and did not return.