Transcript

Good morning. Welcome to this extraordinary meeting. I'm Councillor Tim Harrison, Chairman of the Committee. My Vice Chairman and Councillor Paul Wood has sent apologies for today and Councillor Wittings in this standing in as his representative. To my right is Mr. Watson, Democratic Officer. Welcome and warm wishes to all committee members, cabinet members and officers. Please do ensure your mobiles are switched off until it returns to silent mode. I've not been notified of a fire alarm practice but should the alarm sound can you please all make the way to the exit and make your way outside to the green at the front on St Peter's Hill. If you wish to ask a question or make a comment, can it please request that you indicate by raising your hand? May I remind you that this meeting will be recorded and can also be watched as a live stream or later via the SKDC webcast. Do we have any apologies for absence? Thank you, Chairman. We've received apologies for absence from Councillor Shorwick. Councillor Baxter and Councillor Cleaver also submit their apologies for absence. As you've mentioned, Councillor Wood has submitted his apologies and Councillor Wittings have been appointed. This is his substitute for this meeting. Thank you. Thank you for that. Do we have any declarations of interest? Any members of any interested clear, please remember you can declare it during the meeting should it become apparent at that time. Okay, and moving swiftly on to the only item today, Leisure SK Ltd Board of Directors. I'll go over to Cabinet member Paul Stokes to lead on this, please. Thank you, Chairman. I think the report is quite clear and detailed, but I'll just give a short introduction in terms of where the Leader and the Cabinet are going on this report. The committee will be aware that Leisure SK have and are facing challenges to keep their contract viable. A big challenge is that currently they are very short on the board, something to be fair, which has been going on for a few years, one way or another. Currently we have two board members, one officer and one external. Given that we have little interest overall from members and possibly not the full skill sets from some people, the Leader and the Cabinet have identified people willing and able to assist on the board. Given the circumstances that Leisure SK are in, I think it would be wrong of us not to add to that board. We're asking people to put it together operationally without having a strength on the board. We believe that we have to help the current board. It's very, very unfair on the two members who are the board members, in my opinion, that they are having to stand the load and the responsibility for the company. I appreciate their concerns and advice regarding Cabinet members and the monitoring officer, Mr Watt, will be able to respond to those questions. Thank you. Thank you very much, Councillor Stokes. Mr Watt, do you have anything to add to that? Thanks, Chairman. I just wanted to highlight that in the report we do include the legal comments which do make a strong recommendation that Cabinet members or statutory officers should not normally be appointed as directors of Councillor and companies. That's advice that I've received and I'm obliged to provide you with that advice. But in the report it does say, unless there is significant justification for doing so. In speaking to the Leader of the Council and having discussions with Cabinet, the situation in relation to the company, the fact that we've struggled on a couple of occasions to appoint to the board and the fact that it is underrepresented at the moment, I think there's strong justification for making the appointments that are recommended to you today. So it's on that caveat that that advice is within the report, Chairman. Thank you. Thank you. So just to clarify, legally, they can do it, but it's actual government best practice advice that they don't normally, unless a special reason. So if you can all bear that in mind when you're considering the applicants, please. Okay, so we have three applicants, Councillor Philip Knowles, Councillor Patsy Ellis and Mr Paul Sutton. I don't know whether or not we've had time yet to meet Mr Sutton. I personally have met him. I have a good chat with him. He brings a wealth of knowledge. He has served as a Section 151 officer as far as I'm aware and been on numerous companies. So that'll be a great addition to the board, I think. Councillor Knowles, as we all know, and Councillor Ellis, both people are very prepared to ask questions and chase things up as we're well aware. So moving on, I think firstly, I'd like to see if anybody wants to discuss or speak about Councillor Knowles. Councillor Morgan. It's my understanding that Councillor Knowles has previous experience as a director of his own company and therefore would appear to have the appropriate skill sets required and experience for that role. Councillor Woolley. Thank you, Chairman. Following on from that point, and this is no reflection on Councillors, characters whatsoever, but the evidence as far as the direct ships are concerned or previous experience that qualifies the Councillors for these positions is quite a comprehensive paragraph about the officer concerned, but not about either Councillor. So I wonder if Graham could probably just explain a little further, the background and the experience that those Councillors, what qualifies those Councillors for these particular roles? Yeah, firstly, we'll just deal with, firstly, Councillor Knowles, if that's okay, we do want at a time if that's okay with you, and Mr. Watts, can you come back on that? Thanks, Chairman. I've not got any specific details regarding Councillor Knowles' background, the discussion with the Leader and Cabinet, they've put him forward because they believe he's got the experience and credentials that are going to add value to the board of the committee, and obviously being a Cabinet Member of Governance as well, there's experience there in that respect, but I don't have anything further unless any other members have got anything to share, Chairman. Thank you. Councillor WOLLEY. Thank you, Chairman. If I may come back, why then has the comment been made that both have experience of managing finances? If we haven't got the evidence to show for it, I think the evidence to show for it is that it's well known that Councillor Knowles was a director of his own company, a transport company, going in any further than that, I can't tell you, but the fact that he was a director of his own company does give you the insight that he's got that experience. Councillor Morgan. Sorry. Thank you, Mr. Oates, for reminding us actually that Councillor Knowles is also the Cabinet League for Governance and Audit. I have to say I'm not comfortable because of that specific role of his own Cabinet, with him being involved in this organisation bearing in mind in the past that this committee has looked at the performance of this organisation, so it'd be like policing yourself. I don't know if that's been taken into account. I hate to have to say that, but I'm not comfortable with that. Thank you, Councillor Morgan. Mr. Watson. Just to make it clear, so Councillor Knowles does have the Cabinet of Corporate Governance, but he's not necessarily responsible for this committee. This committee has its own statutory obligations in respect to the constitution and actually the company would be scrutinised by the relevant over-inscrutiny committee. The role of this committee is solely to make appointments to the board. The scrutiny of the company falls under the remit of the relevant over-inscrutiny committee. Thank you for that clarification. Councillor SIVAN. Thank you. Without being facetious, if we talk about Councillor Knowles's, sorry, Transport Company, was it successful? In other words, has he got a good track record? On that, Mr. Councillor Knowles is not here. I can't answer, but I will open that to anybody else that knows Councillor Knowles better than I do. If we can just hold on to that, Mr. Stevens, I've got other hands up around here, so I'll come back. But Councillor Whittington first. Yes, thank you, Mr. Chairman. I have to say, I've reservations about any of the Cabinet members serving on leisure SK. I'm very mindful of the paragraph 2.2, and I know that we've also had an opinion to the extent that the Leader, Deputy Leader and Morning Officer think that the justification exception has been reached or achieved. But I have concerns around that, I must say. It refers to the fact that both Cabinet members of its exit business, as you find, is in the corporate environment, and I'm not doubting that they have an effect. I know that they both have. I'm just wondering how wide the net has been cast. As it's just been looked at on Members of the Administration Group, I certainly know of members of the Coalition, Opposition Group, who have experienced managing finances in the corporate environment. I've been Director of my own company. I've had 38 years experience managing finances in a variety of corporate environments. So a lot of people have this experience, but I'm just wondering how wide. This is not casting aspersions on any of the candidates, but I'm just wondering how wide the net has been cast. I do say I have real concerns that, you know, why has it been? It's really unfortunate, actually, that the Leader and Deputy Leader of the Council aren't here today to answer those questions. So we can examine their thought processes, which I think actually is, and without understanding fully the thought process of objecting Leader and Deputy Leader, I can't support this today because I need to understand why these were the two choices. Thank you. Yeah, thanks for that, Councillor Whittington. But just to make you aware, Councillor Giel, as Leader of the Coalition, was offered a position on this, and he declined to take it up. And as far as I'm aware, the net has been cast out twice, trying to find members that wanted to get on this board. I know I received an email asking about it on two occasions now, and as far as I can remember, that was said to all Councillors. Mr Watts. I just wanted to give some reassurance as well that there may well be conflicts of interest that arise. They will be managed. So, for example, if there was ever a decision that was taken at cabinets relating that had an impact on the company, a direct impact on the company, the expectation would be that the members would have to declare an interest and they wouldn't be able to take part in discussions at that meeting of cabinets. So, where those conflicts arise, they will be managed, and that will be the same with the officer that's appointed as well. We would ensure that those conflicts of interest were managed if they arose. And, of course, that could be an interest that arises in their role on the company as well, because they'll be something in the articles of association regarding any conflicts they may have from that perspective. That would all be managed in accordance with the relevant codes of conduct or practice that are in place. I just wanted to give you that assurance as well, Chairman. Thank you for that. Councillor Fellows, I'm aware that you've had the hand up. I'm going to come back to you. I've got committee members that want to speak first if that's OK. Councillor Laid. Thanks, Chair. My question is that when there was previous people that were interested on going on this board, they actually had to give us a paragraph about what they've done, and what supported them. We don't appear to have had that from either of these cabinet members, and no disrespect to either of them. I don't know them personally. I don't know what they've done. I have no idea. But, you know, why did we do it like that previously, and why haven't we asked for them to give us a paragraph about what their details are to support them going on this board, please? Thank you, Councillor. I kind of agree with that. It's a shame. I mean, we do have Councillor Fellows here who can put her case forward. It's a shame that Councillor Knolls isn't here, or didn't put something in forward, particularly in light of the questions from Councillor Woolie and Councillor Stephen's and Councillor Whittington. But I will have no control over that. Councillor Morgan. Having obviously declared I have sat on the board and was one of the people who had to put forward an explanation as to why I felt qualified, the issue wasn't about skills of the board members leading to a stepping down. The issue was to do with the structure of the way that the board is run in relation to our roles as members and relationship with the Council. It was not to do with the skillsets of those. I'm just because we've had three members who have come forward and all experienced the same issues that you basically want to are a member of the board, your role becomes extremely limited. It's not just about finance being a director of the company, also looking at the strategic approach it's taking and what we found was you had a limited impact at the time, certainly when I was on the board, we were only a minority membership of the board. It mainly comprised officers and the non-exec director and we found that you would make recommendations and they just weren't mentioned and you had no ability to push that forward. There were issues with the structure and how it's run. I have discussed this separately with the non-executive director and in fact also Councillor Stokes as well. I raised concerns about that. One of the points that came up was previously under the previous administration. We actually had a company's committee to which Leisure SK along with other companies at the time the Council held were accountable and reported back to. We don't have that now. I think that is an important gap. In a way it doesn't, almost doesn't matter who is on the board, how well skilled they are but you were going to have a same issue. A mom member as we know who we appointed, I'm sure what mom is saying, Councillor CUNNINGTON joined the board and he only attended one or two meetings before very quickly realising that what I'm saying now applied and therefore he could make very little difference and then step down. I do think that I have advised the cabinet members concerned to consider the structure and I feel we're going round in the same circle that we're trying to address through board members and it might be, this is a short term interim cover in which case I would accept that but if this is just a continuation of the same actually I'm not happy with that at all. So I would appreciate actually if Councillor Stokes perhaps could fill us in a bit. Thank you, Councillor McLACHLAN. I'm going to go first to Mr Watz. I was just going to make the point. I mean we've got the chairman of the relevant every institution committee in attendance. The company's committee is no more but I can, if you look at the agendas for that committee over the last 12 months, the leisure SK Ltd is a regular item that is under consideration by that committee. So although the company's committee is no longer in our structure, the responsibility has moved to the overall institution committee and they are taking that particular role very seriously and holding that company to account. I can't necessarily comment on the performance of the board or individual members and how they contributed previously. I think it's fair to say that Cabinet have looked at this particular issue seriously over the last few months. I don't want to steal Councillor Stokes's thunder but they've obviously looked at the board as it currently stands. They accept that it's underrepresented and they want to ensure that there are people on that board that can move things forward. I'll defer to Councillor Stokes because I don't want to see all your thunder Councillor Stokes. Thank you. Councillor Stokes? Thanks Chair. Yeah, just to correct one point, Councillor Morgan. Councillor CUNNINGTON actually never attended any of the board meetings now. He was appointed but subsequently he got work in the Midlands that would have made it difficult for him to actually attend so he pulled out on the basis he couldn't throw everything at it. I agree, I've actually attended two board meetings now. Strictly speaking, I shouldn't be attending board meetings but it was agreed that the scrutiny committee and as part of our rectification process that I would attend and certainly I agree with what you say and the structure was a little bit not dynamic. I think that we've subsequently had a change of chair and I'm very impressed with the way the current chairmen has led things but I do feel and I think this is very much a short-term solution. I think it would be wrong of us not to do it if I'm honest. I appreciate the comments in terms of references. We are obviously looking at all the methods of running our leisure centres going forward. So I see this as a short-term solution for certainly, shall we say at the moment, for six months then we see where we go but I feel that the board of Leisure Skate as they stand desperately need this help. They need the help, the advice, the commitment which I know the two cabinet members would do. I would absolutely love to be on that board but I can't, a Norcoma leader or deputy. So in terms of the comments from Councillor Whittington, the direction of the leader and deputy leader and myself is very much to make sure that for whatever reason the people who are striving operation they feel supported by that board and I think the strength of the board right now is just not strong enough. Thank you Councillor Stokes I'm now going to go to Councillor Fellows. Hello Paul welcome to my committee nice to have you here. Thank you Chair and thank you for allowing me to speak. As Councillor, no if someone said Councillor Stokes said, no Graham sorry I get my head together. I am here as Chair of the Leisure and Culture Ascutney Committee and issues concerning this board have been coming up and up and up and I want to be totally in support of what Councillor Stokes was saying and Councillor Morgan, we, I actually feel that that board needs support, it needs it six months ago, it certainly needs it at present. Leisure across our area is going to be a major issue in the coming years and we have to make sure that what we accomplish, what we arrive at is something that gives us leisure guaranteed across SKDC going forwards. Originally I put my hand up to give information about Councillor Knowles, obviously he's a personal friend and I was just going to give factual information about him which I'm happy to do Chair at some point but at this point if I could just underline as I see in my role as Chair of that Scutney Committee the total need for the board to have support, to have intelligent contributions and I think that that is so urgent it needed to be done six months ago. As far as Councillor Knowles is concerned and again it is your decision colleagues obviously. Councillor Knowles never had his own company, transport company, he actually worked for a major transport company in Spaulding, that's where he moved down from Lancashire to do, he did that then transpired to a bigger company. I know that he had a place on the board of some sort of and again I apologise for this but you'll understand that I'm in no way financially sensible at all. He had a seat on the board for a major insurance company working out of the Liver Building in Liverpool and he sat there for a number of years, he was Chair of Finance on Born Town Council and also worked with Born United Charities but again I'm reminded of what Councillor Morgan was saying, I don't actually think these posts are necessarily financially determined. I as Chair of Culture and Leisure would like to see this board supported by some Councillors who have the ability, the knowledge, the expertise to help them move forwards. Thank you for that, Councillor Fellows. I agree, I would love that as well but we have cast a net out twice for Councillors to step forward and as was spoken, Councillor Collison was one that stepped forward but then unfortunately had to step down because of the change in job situation. So we are where we are at the moment so I would ask everyone to bear in mind. So specifically on this one we're considering Councillor Noles. So you've heard that he has experience of directorship, you will all have your own experiences of Councillor Noles and your own personal thoughts as to his abilities to bring something to the board of Leisure SK. My personal thoughts are that he is very capable, he is incessant on his efforts to get to the bottom of things and proper organisation of everything. So I have no qualms about voting for Councillor Noles but you have to take into consideration what else has been discussed here that sadly we don't have any information from Councillor Noles himself to consider. You also have to take into account the consideration of the advice of government on cabinet members becoming directors but as Mr Watson said, there is extenuating circumstances that allow for that and at this case I think we'll all agree we are in those extenuating circumstances. There is no doubt the two directors at the moment are in dire need of support and help. We all know the state of play at the moment and it's in all our interests that we get Leisure SK back on track and the only way we're going to do that is by getting more people on the board so I actually consider that as well. So would I get a proposal to propose that Councillor Noles is put forward to it for the board please. Councillor Morgan, thank you. Can I get a seconder for that please? Councillor Laid, thank you. Sorry, you want to speak? Sorry, Councillor Laid, sorry. I will second it but I just want to clarify that we talked about it being for a temporary time. I don't believe there's anything in here about it being for a temporary time so do we need to clarify that it is on a temporary basis until we get a level footing or is it on a permanent basis please? Sorry. I'll defer to Mr What's for that. I mean ultimately it's the committee that is responsible for appointing directors to the board and if you wish to appoints on a basis of it being a temporary arrangement then you need to agree a term that you think's appropriate but it's in your gift really in terms of how you appoint to the board. Councillor Morgan, do you want to alter your proposal? I'd like to thank Councillor Lee for that intervention based on my earlier comments so I would suggest that we approve the Board of Councillors picking up Councillor Stokes comments for six months in the first instance and then subject to reviewing if that's acceptable. Okay so to be clear we're talking solely about Councillor Noles at the minute and you propose that we putting forward as cabinet members, as directed at for a period of six months to then be reassessed is that correct? That's correct. Councillor Layton are you happy to second that proposal? Thank you. Okay so we have a proposal on the table can we take a vote on that please or those in favour? That's for in favour please or those against? One against and an abstention Councillor Holy thank you. So Councillor Noles is duly put on to the board thank you. We'll move on next to Councillor Ellis and Councillor Ellis is actually here so I will ask if Councillor Ellis would like to give a short speech about herself please to everybody. Thank you Chair for the opportunity. I have been in business all my life, all my work and career which goes back quite some time now. I have held previous company directorships, my strengths are getting stuffed on, it's and my specialty is a generalist kind of overseeing of companies although I do work primarily in finance for most of them. I'm really good at what I do. I do get stuffed on and I feel there is never an option for me so and I'd like to get under the hood of Measure SK, see what's happening, see if I can bring my strengths, my expertise to help it function adequately. And that's it, any I'm happy to answer any questions. Thank you Councillor Ellis, does any of the committee have a question for Councillor Ellis? Go first to Councillor Morgan. And thank you for that. We appreciate that Councillor Noles is expertise is probably around finance as well. So and as I mentioned earlier obviously being on the board is more than about that. So what's your understanding of what would your aims be as a director regarding the Measure SK such an important part of what Council does and obviously something that we're committed to delivering Measure Services, what would what's your view of regarding the ledger side of this as opposed to the financial delivery of the company? Councillor Ellis do you want to come back on that? Yeah sure. As I say in my previous positions I've had a generalist view, I've been general manager, operations director. So I have an interest in marketing, in staff retention and everything that goes towards making a company successful. So I would view it holistically but obviously the primary thing at the moment is to get the finances right. We can't get the finances right unless we get the whole ledger exercise working effectively and we have an excellent offering to the public and people of SKDC. Thank you for that Councillor Ellis. Councillor Stevens I think you've had your hand up. That's right thank you. Councillor Ellis could you very kindly give us an example of your not an example. Describe the most successful company you were a director of and what that company did and what your exact role was please. It's hard to choose every company I work with because I work with companies not for them. They've all been successful. Currently I'm working for a company who designed and delivered exhibition stands which is very interesting. Previously I've worked with a company that they were distributors of hydraulic equipment, filtration equipment, water monitoring, so basically engineering quite niche and delivered growth in every single one of these companies. Thank you. So moving on there's just a council. Sorry Council will you add your hand up. Thank you. Again the following is no reflection on the character of the Councillor but there are a couple of things that apply to both Councillors and indeed Councillor Ellis around something that Mr Watts said that there could be instances where there is a conflict of interest and then following on as something that Councillor Stokes said around this only being a temporary measure. At the moment Leisure SK is poorer if it has two directors and it has two directors so I'm wondering why for the sake of keeping things clear I completely accept that putting somebody else on the board gives a little bit of breathing space to the other two but why we can't just look at Paul Sutton rather than including the two cabinet members who may end up anyway having to pull out will we know better off will we because we will still only be core at? Thank you. Thank you Councillor. We'll just come back on that. I think if we did that we would never get anything done because somebody may pull out or might drop out or anything like that. I think we're all of the agreement that the workload is far too much for two people to do there alone and as I've stated two or three times throughout this meeting we have cast the net far and wide asking for people to stand up. These people have stood up to be counted. They're willing to give their time up, they're willing to put the effort in so I think we need to speak personally on Councillor Ellis. I've worked very closely with Councillor Ellis and I think she would personally think she would be a very valuable addition to the board and the more people we have on the board the better view and better opinions or the more opinions we're going to get on how to take it forward. So I think going through with a bare minimum of two because it's core it would be a very bad step for us indeed. Moving on there's Councillor Lay and Councillor Whittington that haven't said anything or asked anything of Councillor Ellis through whatever you want to, Councillor Whittington. As I say, if this is casting out aspersions against Councillors Ellis at all, I come back to my fundamental principle that I can't support cabinet members being directors. I don't think what I've heard, I mean I'm really strongly minded and particularly concerned about potential conflicts of interest. That's just from a peer governance point of view. Thank you. Thank you, Councillor Whittington. I recognise your concerns as the government best practice guidelines sort of say try not to do that but there is a provision put there and we do have the assurance of Dem services that any issues of conflicts of interest would be very, very carefully monitored. Councillor Lay, did you have any questions for Councillor Ellis? No, okay. So moving on then, I'd like to propose Councillor Ellis to be on the board. Do I get a seconder for that, please? Councillor Morgan, you're a seconder. We've got to propose on a seconder. Could we take a vote on Councillor Ellis, please? Just to clarify, that would also be for six months as a Councillor Noss. If I may ask you, I should propose that we do the same as we did for Councillor Noss and it's for six months period. Yeah, I agree to that and as Mr Watts just pointed out to me, I didn't actually say that in the proposal. So it will be for an initial six month period. I personally think that should apply to all three members, but we'll discuss that when we come on to the third one. For the reason being, as it gives us time to see how this is progressing and we need to make big moves on this as going forward. Councillor SEVEN's, we've got a proposal and we were taking a vote. Is it something about this? Sorry to interject, but the fact that Councillor shorted an excellent candidate, do you think the Councillor with you, that's made a really good point about cabinet members? So, when I vote against this, it's for that reason. I want to make that clear. Yeah, sure. That's totally recognised and thanks for pointing that out. So we've got a proposal and a seconder for a six month period for Councillor Ellis to be on to the Board of Leisure SK. Can I take a vote? All those four, please? All those against? Two? And all those abstaining? Three. So I'll get the casting vote on that and I'll go with the vote that I voted initially, I'm afraid. So Councillor Ellis is duly put on to the Board. Thank you. But it is noted, Councillor Whittington's and Councillor Stephen's objections and the reasons for those objections. So if you can put that, make sure that's in. Thank you. Right. So then we move on to the Mr Sutton. I don't know whether any of you have had a chance to meet Mr Sutton yet. I have. I know Councillor Lay has. I think Councillor Stokes might have it on. I'm not sure. But maybe I can go to Mr Whilst to speak a little bit about Mr Sutton. There is a little bit in your minute. So do you have a read of that as well while Mr Whilst speaks? Yeah, thank you, Mr Chairman. It's probably just helpful to set the context of this individual, because clearly it's very new to the authority. There is a pen portrait in the report, as you've said, which gives a little bit of context. The reason this individuals join the authority is due to the temporary arrangement of the current Deputy 151 stepping into the Director of Housing role. That's a temporary arrangement. So it was asked of me to put a back fill arrangement in place whilst that role isn't taken by Alison Hall Wright, which is what I've done. So this individual and coincidentally sits with the timelines that have been discussed previously. He's here for six months on this temporary arrangement. And at that point that'll be reviewed and a way forward will be agreed at that particular juncture. So he's only here for a six month period, so that does align with previous comments. In terms of him as as an individual, I went to the interim market and the benchmark and the expectations were set very high as to what kind of individual would be the right level of competency and qualification experience that would sit within the organisation. And this individual came forward with a wealth of experience working in the interim market for over 20 years. So he just brings a lot of experience from other authorities, has worked in authorities where the company model is also present. So he's very aware of that demarcation between a company and a council and how they should interact and the governance around boats. So he came very knowledgeable in that space and indeed my top five to do items. This was number one. So this was the first conversation he and I had when he joined us last week. This was way before we'd even considered putting him on the board as a recommendation. So he was already alive to the challenges of Leisure SDK, also very aware of the financial pressures it's operated in, which I will keep saying is sector driven issue as well as some of the local governance difficulties, this particular companies have, but it is echoed across the sector. So it is worth making that point. I think as well we're all very aware that the skills already of the board revealed that financial property and analysis and forensic appraisals were something that was missing. And that came to light as we know back in January when there was an urgent request for more money going into the company and the council hadn't been cited on that. So from an officer perspective looking in we're very well quickly alerted to the fact that the financial integrity of the company was not a priority for the board at that particular point. Hence why we had this acceleration of a request. So Paul from my perspective sits very well as a complement to the board as it is currently in the recommendations we've made today and hopefully we'll plug that gap and ensure that under the new chair fight the financial analysis and forensic not only looking back on spend but being very aware of the other short to medium term challenges and the actions they're taking to mitigate them will be at the forefront of those board discussions and meetings and outcomes going forward and that's really why as officers and with cabinet we've recommended this individual be put forward. Thank you. Thank you for that Mr. Wells. So I'd just like to add to that I mean Mr. Wells is obviously our section 151 officer we put his trust in him with a lot of things and so my trust is definitely with him on the character of Mr Sutton and Mr Sutton's abilities. Mr. Wells definitely has a better insight into Mr Sutton obviously having interviewed him and given him the job. I had the pleasure of meeting Mr Sutton having about an hour within the other day very impressed with my limited knowledge of his skills. I was very impressed at how he put himself forward. So I personally can see no issues with this but I'll go to the committee and see if anybody has any questions to put forward. Councillor Stevens. And it's made sound an odd comment but this chap's a professional, if you look a professional director and this is an important position. Would he be paid and would he be paid a commercial rate? Good question actually how will that work Mr. Wells because I know he's we we actually employ him on a day rate at the moment I feel. So what will happen with the work that he does for the committee? Will that be like a pro bono or will we be paying him? Will that come under his wage as a as a on a day rate? I mean any officers that are employed and paid for by the council that sit on that board there is no remuneration for being on that board so in line with the other officers who are on the board there is no financial transaction between the council and the board so basically the council picks the cost up and puts him on the board free of charge because they're not paid rolls. Thank you. Thank you for that explanation. Councillor Whittington. Thanks Mr. Chairman. Apart from Councillors Alice and Knowles who are the other can you just remind us Richard who the other two directors are? Thank you. Yes in 2.2, Councillor Whittington. Councillor Morgan. Yes, thank you. I just want to clarify quite an important point picking up the reference to lack of forensic examination of the figures. When I was director, a director of the board, actually I called for an emergency meeting of the board in response to seeing the figures. The issue that I had was that the chair of the board subsequently failed to actually call that meeting so consequently there was no meeting of the board prior to the presentation to the cabinet. I just like to put that on record. So I just want to make that clear that it was not that there was no, this was the issue I was saying about the structure of the board putting that aside. What I'm concerned about is that we've got three, now I'm more concerned actually having had a proper explanation about the role of Mr Sutton. We've basically got three board members who it feels so purpose almost is to forensically examine the finances. I really understand why. I'm also very aware that some of those financial issues are actually are external factors that affect the company and therefore are really interested to see how I manage those. However, my worry is, and I think council fellows might have some sympathy with this concern. As I said at the beginning, this is not just about the roles, not just about finance, it's also about having a care for the delivery of our leisure amenities, and ensuring that we are providing a good service to all of our community. What's worrying me here is the impact I see and now and in balance regarding what the focus will be. And I do not want to appoint a board to leisureous K that is only minded really to look at the finance, the financial aspect of it. That's already a function actually of our other existing non-executive director, David Monkhouse. And I also do think it's quite interesting that given we've had all the board member changes, given the comment just made, we have persisted in retaining that non-exec director who actually has been consistently a member of the board for several years. So arguably has been a consistent member overseeing all of the issues that we now have, but it's remained the fact of fate. But it's on the board still. I don't understand the logic of that. I have to admit. So I'm going to abstain on this vote regarding Mr. Sun for those reasons, not a reflection of him by any means. It's just the fact that I feel that the balance of the board, it is wrong. If you look at any company, your board will be made up of different people or different skill sets that they all come together. And we appear to have at least three new people, no doubt strong in a particular area. And I feel we're lacking the knowledge and skills around leisure. Again, thanks for that, Councillor Morgan. But coming back on that, I think we know Councillor Noles and Councillor Alice well enough to know that we, as Councillors, will be able to approach any of those with any issues we've got as we see any developments in issues with the leisure side of it as opposed to the finance side of it. And they will take that upon our behalf. And also, Debbie Roberts is not so much on the finance side of it, more overseeing both sides of it, I would have thought, in her position. So I'm pretty much satisfied that we've got, as even as spread as we could possibly get with five members. Sorry. Yeah, just to clarify, operational matters are actually dealt with by the management team within the board. If we have an issue regarding the delivery of services, actually what we're tended to do was in fact refer to Councillor Stokes, who's the cabinet lead, rather than actually the directors of leisure SK, just to clarify that. Yeah, okay. So on that point, I'll stand corrected on that, but we would go, we would make our point of view known to those Councillors on the board, whether that be directly through casual conversation or through Councillor Stokes. I totally agree on that. If I can just interrupt and come to Mr Wiles, I think he wanted to come back on that. I mean, I'm very mindful we're in a public setting, so I don't want to go into any kind of commercial debate, but I think it's beyond any doubt that the financial integrity and stability of the company has been the primary concern of this Council for some time. The fact that we had to pump quarter million pounds into that company in January, having only been made aware of that issue in, I think it was referenced in a November report to the Culture OSC, but that meeting was deferred on that item. So within 12 weeks of the final end of the year was only when this Council was formally alerted to it. I think it's beyond any doubt that the financial forensic analysis of the company has not been at the primary forefront of any of the board meetings, and I don't think that's subject to a debate. I think that's factual. The reason, and from my perspective, I don't think the company has yet provided a level of assurance that it's now financially stable, having just had that particular issue brought to the attention of the Council. So for me, I think it is one of the primary focuses needed of the board, and I recognise the skills and qualities that the Councillors will bring to it, but Paul Sutton will bring that financial forensic insight that I personally believe has been lacking and continues to be lacking on that board until the disappointment is made. Thank you. Thank you, Mr Waz. I totally agree on Mr Sutton's abilities. Council we're into. Thanks, Mr Chairman. I got no problems with as many people on the board with financial expertise as possible, because we know the finances of the Azure SKO on to the great position. In fact, historically, we must have pumped well over a million pounds into Azure SK over previous years. Not just in this administration, I'll be fair in the previous administration as well. We had to pump a large amount in there to keep it afloat. I suspect that the problem that we've actually got is we're operating a model that doesn't work. The model is fundamentally wrong, and I see nothing in here. In 2.2, we talk about operational and financial performance. I've seen nothing in here around strategy. I've seen nothing in here about the future direction. We seem as if we're firefighting with this company at the moment. I'm not being critical of any of the directors or any people who work there. Fundamentally, they're operating a model that's wrong. So, at some point, I think the only long-term solution is to fundamentally change the model. Now, whether that's -- and particularly, it doesn't particularly bother me what that model is, but I think there's got to be a better model than we've got here. So, I'm perfectly happy having Mr Sutton there with his level of financial experience. This is a question, so just a general comment. I think the model's wrong and we need to change it. Ultimately, I'm not going to debate what that's going to look like, but I think it has to change. But, in terms of -- and when perhaps Richard can give a bit of bad information, in terms of Debbie, David Monkhouse, and Mr Sutton, Paul Sutton, have any of them in their experience managed -- you say that Mr Sutton managed other council companies. Has he got experience of running a council leisure company? Because, if he has, I think that would be a valuable experience as well, or Mr Monkhouse has. I'm just wondering just a bit of clarity around that, thanks. But, I've got no problems with voting for Mr Sutton, because I think we need more people with an actual experience on that. Thank you. Thank you, Councillor Woodington. I agree, we are fighting fires and things do need to change, but that's a whole point of why we're here today to try and put more people on the board to facilitate us with those changes. I'm going to move on now to Councillor LAY. Thanks, Chair. One of my questions was going to be that the non-executive director, I understand, is from a leisure background, I believe. So, he has quite an in-depth knowledge. That's correct, as far as I'm aware. So, I think he's best placed, possibly. I can't say personally, I don't know him. But, from what I gather, he is a person that does quite a lot in the leisure industry. Also, that Paul is transformational. He's got a lot of knowledge about transformational, which is probably what we would need, and there isn't anybody else on that board that seems to have that experience. I don't disagree with Councillor Wittington in saying that we probably need to look at the structure and the strategy of what this is going forward and how it's going to look, because obviously it's a big job. There's a lot of in-depth financial matters that need to be looked into before they can take it any further forward. So, from my perspective, I definitely would support Paul being on this board. Thanks for that, Councillor LAY. Councillor Stokes, did you have something to come back? Yeah, just so I could add to that, I'm totally in tune with Mr. Wiles on this particular appointment. David Munkhouse, the non-exec director, and I'm not giving it any way, I was very disappointed that in terms of his leisure background, he hadn't stepped forward previously, I'll be honest, and I've told him that, and Councillor Knowles has said that in this chamber, but having spoken to him, he is usually committed to the project. He is a leisure expert, he is an expert in terms of quest management and inspection, he has run leisure centres, he advises numerous leisure contractors, and from his point of view, he has acknowledged that maybe he's been distracted by the finance element as well, and that he needs to focus on his particular strengths, and that's what I think we're doing today, we're giving him that opportunity. My personal feelings are, that going back to the previous conversation with Councillor Woolley, the non-exec director, if he walked away, then we do lose our leisure experts, but the current situation with two of them is putting quite a lot of strain on them, and I also feel that our chairman, we are safeguarding health and well-being by not leaving everything to us, he's got another job at this council that is quite taxing, and I just feel that the support is so crucial, but David Monkhouse, I've now got confidence that he's rolled his leisure up, and he's going to use the experience he's got. Thank you, Councillor Stokes, and I agree from what you've told me about that situation, and that having these extra people on the board will free him up to do his expertise. Councillor Morgan. Yeah, thank you, thank you. But based on the new information regarding the leisure experience of Mr Sutton, and I acknowledge his financial experience will, of course, be useful. Fact, technically, he's the only formally officially qualified person in that area that I'm aware of, then I would support him, I would support him. Sorry, Charmaine, just to clarify there, I think the leisure experience that Councillor Stokes was referring to was a non-executive member. No, it was Councillor Lee, I think, unless she was referred to, unless I misunderstood Mr Sutton. No, no, no. So I kind of just clarify, we're in a public meeting and Paul might have to be watching, so I don't want him to be misrepresented. Paul is not a leisure industry expert. The current Ned is a leisure industry expert. What Paul can do, Paul can read a cash flow, Paul can read a project plan, Paul can read budgets. That's the skills he's bringing to this board. Thank you. Yeah, thank you. That was one of us trying to say, Councillor Morgan, I thought you'd miss it. I do indeed. But what we're saying, though, is we've got two people, one with the leisure expertise, who will be supported by the person of the financial expertise, but by our members. So they're balanced. There is a balance. So, Councillor Lai, can you just do you, Mark? So, there is a balance in there. So, I'm happy to propose, then, that we have Mr Sutton for, again, for six months. Okay, so I've got that proposal for Mr Sutton, who's on a temporary contract anyway, so six months of casting Noah Spurgeon's on his abilities. Before I go for a second, or Councillor Stevens, you've got a... Yeah, these are questions I should have asked really from the beginning. I don't feel anyone has the, oh, I don't have any sense of the scale of this business and the scale of the problem, and having furious leaves shuffled through Google, and goodness, there's what. There's absolutely nothing to be fun. Do we have a simple... Can anyone tell me, is there something called a CEO? Who is the chief executive? Who takes the active decisions? Because you have a board, you should have someone reporting to you, namely the chief executive. Who is that? What's his background? Is he paid properly, and is any incentive to do a good job or does really amble along? Because it has been a pretty consistent shambles for what I can see. And in a sense, I think we're sort of addressing the overview before addressing the way this can operate well is by having a CEO in a structure. This council, when it operates well, it's because it has a good CEO who we hold a feet to the far of that CEO. That's how things should operate. This is an oversight body just as this committee is an oversight body, but I want to say who we are overseeing, and effectively why this thing has been such a shambles. Right, well, as far as I see it, and I'll stand to be corrected by Mr Wiles, this is a company, an SKDC company. We have the chairman, which is Debbie, and her job will be ultimately to report to our CEO, I'm sure, but I'll stand to be corrected by Mr Wiles. Yeah, I mean, I'm presumably happy for this debate, because it's outside the remit of the report. We're looking at appointments to the board, but as a general observation. The governance structure is clear, it's in the articles of association that have been approved by the council anyway. They have a chairman of the board, the chairman is referencing this document, so that's clear. That chairman, the role of the council, those affected the shareholders, bringing that board to account. The chairman presents reports and presents information to the council. Can you tell me my cough, please? I don't believe this paper is suggesting the current governance arrangement is not fit for purpose. I think the report is strengthening the current arrangement, and by putting more board members on that, the interface between the company and the council, I believe is working appropriately. Thank you for that, Mr Wiles, and I agree with you on that. We're not actually here to discuss that, but it was just looking for a bit of clarification for council statements from the question. Council statements, you want to come back? Really, because in a sense, this whole debate is rather sort of has no purpose, because if we don't, if a legislature is key, it doesn't have a commercial structure, it's a quasi-commercial body, obviously. Namely, a CEO who we can, we as the as the overseeing directors, it's effectively what we are, can examine and review, say, why has this not happened or well done? It has happened, whatever the question is, but if we can't put someone in the seat and examine him, it's always going to be wishy, washy, and gosh, what are the same, £243,000 being lost again, or whatever the figure is? Yeah, sorry, sorry, Council said we're going to have to interview you, because we're not actually here to discuss that today. Well, that would have to, I'm happy for you, too, to bring that up at another time. Well, today, we're purely here to discuss the pointies, that's so, excuse me. I recognise your point, Councillor Stevenson, it's noted, thank you. So I've had a proposal, can I get a second to please? So I've got a Councillor Alice to second this one, happy for Councillor Alice to vote on this, because it's not her appointment. So I've had a proposal and a seconder for a six-month appointment do, can we take a vote on that, please, before I lose my voice completely? Five-four, what can I have a vote against, please, and any abstentions? Two abstentions, thank you. So that is Julie Elector, it's Julie Elector to the Board as well. So, ultimately, that's all our business today, thank you everyone for attending. I declare this meeting closed at 1105, thank you very much.