Cabinet 27 July 2004
REPORT TO CABINET MEMBER FOR EMPLOYMENT, SKILLS AND
SUBJECT CAPITAL FUNDING FOR THE EMPLOYMENT INITIATIVE
KEY DECISION YES – 314/ESL
REPORT OF LEARNING AND SKILLS MANAGER
CONTACT ROBERT JOLLEY : (01256) 844844 ext 2652 or (01256) 845652 or
email firstname.lastname@example.org or
PAUL CURRAN : (01256) 844844 ext 2752 or (01256) 845752 or
1. Purpose of Report
1.1 The purpose of this report is to seek a Cabinet decision to request the Council to
provide capital funding to enable the one-stop-shop project to proceed.
1.2 This report accords with the Council‟s Budget and Policy Framework Priority Four:-
“To improve opportunities in learning and skills to support individual development,
community organisations and local businesses.”
2. Background Information
2.1 The Borough of Basingstoke and Deane has one of the highest economic activity and
employment rates in the UK. Sustained growth, however, in a number of key sectors
means that local companies have had difficulties finding a good supply of suitably skilled
people within a tight labour market with low unemployment. The creation of Festival
Place shopping centre in October 2002 (which needed about 2,500 people to fill the
created job vacancies) meant that Basingstoke needed a new employment and skills
solution – no one agency could tackle this problem alone.
2.2 The Employment Initiative is a multi-agency body designed to provide a sustainable
solution to the recruitment and retention issues facing the Borough. The Employment
Initiative (EI) was established to work with businesses and the community to find
innovative ways of delivering high quality skills and training for jobs. The Initiative is
targeted at both employed and unemployed people.
2.3 The EI is strategically directed by a management team which includes senior
representatives from the following organisations:
Basingstoke and Deane Borough Council
Basingstoke College of Technology
Queen Mary‟s College
Eli Lilly and Company
Virtuous Resourcing (private sector recruitment consultants)
Skillsmart (a government sponsored body to promote the retail sector)
Local Learning and Skills Council for Hampshire and the Isle of Wight (LLSC)
Local Strategic Partnership
2.4 EI projects include:-
a) An outreach programme – helping to encourage members of the „hidden
workforce‟ within the community to come forward supported by a programme of
encouragement and training.
b) A retail Employer Learning Hub (ELH) - development of a customised training
c) A training, employment and advice shop or „one-stop-shop‟ in the centre of town.
2.5 BCOT, the principal training provider within the Employment Initiative, already reaches
outlying areas with Learndirect programmes operating in Chineham and Tadley. The
one-stop-shop will be promoted in both town and rural areas throughout the Borough and
could be expanded to provide overall services in the future. The one-stop-shop can be a
bridge into employment for these harder to reach members of the community.
2.6 It is the one-stop-shop which will be the principal delivery vehicle for the EI. As such, it
is critically important to the success of the EI that the shop is set up as soon as possible.
The one-stop-shop will, initially, focus attention upon the retail sector, although it is
envisaged that the programme will later be rolled out to other sectors. A copy of the one-
stop-shop business plan is appended to this report and is available in Member's Group
2.7 Elements of the one-stop-shop business model are:-
a) the service will be free to clients (individuals seeking a job and/or training);
b) the shop will be strategically positioned in a high profile, town centre location to
ensure that there is high visibility to shopping centre visitors;
c) the main sources of income in year one will be through the provision of
government funded Learndirect training and business specific training courses.
After year one, additional income will flow from the on-site recruitment service
(Virtuous Resourcing) who will be charging employers a modest fee to recruit and
train new staff;
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d) Jobcentreplus will represented within the one-stop-shop providing support advice
and assistance to visitors as an outpost from it‟s Winchester Road offices. The one-
stop-shop will provide internet access to Jobcentreplus registered vacancies and
ready communications to Jobcentreplus officers. It will also provide a brokerage
and signposting service to all other employment and training related services from
various providers within the Borough; and
e) the service will operate for a minimum of five years.
2.8 The one-stop-shop addresses an immediate need within Basingstoke to provide
employers with staff and a centre for training. Potential employees have access to
training and an expanded range of facilities over those currently available through the
BCOT Market Square training centre. The option of a „virtual centre‟ providing access
on-line only, cannot adequately assist those seeking employment advice or support with
IT training courses. The initial findings for the option of incorporating the one-stop-shop
within the proposed „Discovery Centre‟ indicate that the capital cost of conversion may
be prohibitively high and that the opening of the facility is at least two years away. The
shop approach creates a dedicated facility with a welcoming and inclusive atmosphere
where links can be developed with both employers and staff right in the heart of the
2 .9 By facilitating the creation of the one-stop-shop the Council is directly contributing to
the environmental wellbeing of Basingstoke and Deane, taking measures to further
enhance community and commercial prosperity.
3. Current Situation
3.1 Following a successful partner workshop on the 1st April 2004, the Employment
Initiative partners collectively agreed to drive forward the opening of the one-stop-shop
in the town centre. Since that date, the business plan has been finalised and this has been
submitted to Grosvenor for their approval. As owners of Festival Place, Grosvenor is a
key partner because they can provide the premises and some revenue funding. It is
anticipated that the Grosvenor shopping centre investments committee will approve the
one-stop-shop business plan in August 2004.
3.2 The Business Plan uses, as illustration, premises at Kensington House, Festival Place.
The capital and leasing costs are estimated accordingly. It is clear however, that different
sites, within Festival Place or the town centre, offer a better match to the intended service
offering. The EI partnership is seeking suitable premises either within Festival Place or
within easy reach of it. The capital and revenue costs stated are, in any event, the
maximum levels based upon current information.
3.3 A consultant project manager has been appointed for a limited period to help progress the
EI and achieve the delivery of the one-stop-shop whilst there is no Employment Initiative
Project Director in place. The project manager maintains a summary project Gantt chart
for the purpose of informing the partners of progress and deadlines. This is updated
weekly as the project progresses.
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3.4 Partners are currently working upon the assumption that Basingstoke College of
Technology (BCOT) will take the lease on behalf of the EI. A legal agreement is to be
drafted between BCOT and the other partners before the lease can be negotiated and
assigned. It is anticipated that the negotiations will take place between Grosvenor (as the
landlord) and BCOT (as the potential tenant), on behalf of the Employment Initiative.
3.5 The annual revenue expenditure for the one-stop-shop is detailed in the Business Plan
(See Appendix Two, held in the Members‟ Group rooms). The majority of this
expenditure will be covered by revenue income provided by training courses undertaken
by BCOT with the balance being made up of contributions from the private sector
partners (Grosvenor and Virtuous Resourcing). Virtuous Resourcing will not, in the first
instance, be in a position to contribute much but as their business starts to develop, the
contribution is expected to increase. The specific details of the agreement between the
Employment Initiative partners and Virtuous Resourcing still needs to be worked out.
3.6 The total capital expenditure required for the one-stop-shop is estimated to be £150,000.
The capital funding will pay for the design of the shop, first and second shop fit works,
the glazing, the furniture, lighting, IT infrastructure and all other up front expenditure to
enable the shop to be physically created. Approaches have been made to South East
England Development Agency (SEEDA) and the Hampshire and IOW Learning and
Skills Council for capital funding support but, following strategic reviews, they are not in
a position to provide such funding, concentrating instead on relatively modest revenue
support for training initiatives.
3.7 The business plan shows a capital funding requirement of £150,000, which is considered
a ceiling figure. The capital cost of conversion and the revenue costs of operation will be
determined by the chosen location of the one-stop-shop. A key concern is over the timing
of the capital funding. The business plan forecasts opening the shop during February
2005, but is potentially affected by several risk factors. Works should be undertaken
during the autumn and winter of 2004/2005. Without capital funding however, work
3.8 The Capital Appraisal report for the one-stop-shop includes a Risk Register which
examines the major concerns on the project and lists the mitigating action to be taken.
This is examined further in section 5 below.
4.0 Options and Implications
4.1 Following a rigorous analysis by officers of all available capital funding opportunities, it
has emerged that, given the tight timescales involved, that only the Council has the
capital resources to fund the one-stop-shop. There are two possible routes for capital
Corporate Capital Appraisal process or
S.106 money for town centre projects;
4.2 Corporate capital appraisal process: The one-stop-shop has already been assessed by
the corporate capital appraisal process at the end of 2003. At that time there was only a
partially completed business plan and the project could not be judged on its merits.
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There is now a full business plan in place and it is now much clearer that this project is a
corporate priority. It is, therefore, likely that if the appraisal was undertaken now that it
would score much better. A new version of the capital appraisal is contained in Appendix
One which is available in the Member‟s Group rooms. This year‟s capital appraisal
process does not start until the end of July „04, deadline for submissions is in September
„04 and moderation taking place after that. Cabinet will not be making choices until
November „04 and Council will be making a decision in February 2005. The timing,
therefore, does not work for this project. However, if Members do judge that this project
is a high priority then resources could be made available outside of the capital appraisal
framework, with a direct bid to Council.
4.3 Section 106 money for town centre projects: The Council is currently working on a
corporate approach to dealing with this. Officers have met on this matter and believe that
using S.106 contributions for the one-stop-shop is likely to be inappropriate as there is no
direct planning link between residential developments and the one-stop-shop. Leisure
Services already have a range of projects in the pipeline which have stronger planning
links with the developments.
5. Risk Assessment
5.1 The main risks associated with the project relate to the continued funding of Learndirect
courses from central government. This is the main component of forecast revenue stream
for the one-stop-shop. BCOT is the most successful supplier of Learndirect training in
Hampshire and closely tracks strategic developments in this area. It is officers
understanding that BCOT does not anticipate any disruption to funding over the initial
five years of operation. In the event that government training grant structures change,
BCOT will adapt it‟s service offering to maintain one-stop-shop revenues. BDBC will
not be responsible for making good any shortfall on operating revenues experienced by
5.2 The present business plan is considered a worst-case scenario in that it illustrates a one-
stop-shop located in a prime Festival Place location with high leasing value. The
Employment Initiative partnership will continue to develop the business plan as other
potential premises are evaluated. External capital funding requests have been rejected
although the recently proposed award of „Centre Of Vocational Excellence (COVE) for
Retail‟ to BCOT potentially contains a component sum which could be channeled to the
one-stop-shop, as this closely supports the aims of the COVE initiative.
5.3 The risk register addresses the one-stop-shop specific issues. The Risk Register is
included in the Capital Appraisal analysis which is contained in Appendix One of this
report, available in the Member‟s Group rooms.
6. Environmental and Sustainability Considerations
6.1 The one-stop-shop will provide an important service to local people and businesses,
providing them with access to excellent training and employment opportunities. As such
it will directly impact on the skills shortage problems of the Borough.
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6.2 The one-stop-shop will be self sustaining in operation and, by serving the local employer
community, will help sustain the excellent economic performance of the Borough and the
well being of it‟s community.
6.3 The Major Consultation with Business in 2000 showed that finding a good supply of
suitably skilled people was the biggest barrier to success for large businesses and the
second biggest barrier for small and medium enterprises. The one-stop-shop will address
this problem and make a significant contribution to it‟s solution.
7. Financial Implications
7.1 There are no revenue budget implications for the Council as the Business Plan identifies
that the running cost will be met from income. The revenue costs of the one-stop-shop
are estimated at £266,000 (increasing by inflation each year) and it is anticipated
£254,000 of this will be recovered by income provided by in-house training undertaken
by BCOT and the balance provided by private sector partners, including Grosvenor.
7.2 The estimated one-off capital setup cost of the one-stop-shop is £150,000. The Business
Plan identifies partner contributions as a possible source of capital funding. However, to
meet the timescales identified in the report, a bid for capital funding of £150,000 from
the Council‟s Revenue Reserve for Capital Purposes – New Priorities, is required.
7.3 Following assessment using the Council‟s capital appraisal process and prioritisation
process, full Council approval to release funds for the scheme is required.
8. Legal and Personnel Implications
8.1 There are no legal implications at the present time.
8.2 However, in due course, there may well be a need to enter into legal documentation to
secure the Borough Council‟s position as regards the one-stop-shop and the Employment
9.1 It is recommended that the Cabinet recommends the Council to:-
Note the progress being made to deliver a one-stop-shop for training, employment
and advice within the town centre, for the benefit of the whole community within the
Support the creation of the Employment Initiative One-Stop-Shop.
Consider the risk register and capital appraisal documents prepared in support of this
request and agree to release £150,000 from the Revenue Reserve for Capital Purposes
– Capital Priorities, to enable the one-stop-shop to be created subject to satisfactory
legal agreements that negate liability for any revenue income shortfalls.
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APPENDICES Appendix One Capital Appraisal and Risk Register
Appendix Two :Business Plan (Version 2)
Both appendices are available in the Member‟s Group
BACKGROUND None declared
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