Decision details

10.1

The Executive Director, Place submitted a report in relation to the Sheffield Digital Business Incubator Project.

10.2

RESOLVED: That Cabinet agrees:-

(a)

to accept the grant offer of £3.5 million;

(b)

to accept Sheffield City Council becoming the Accountable Body for the grant on behalf of a third party who will deliver the project and payment of grant aid to the third party delivering the project; and

(c)

to delegate authority to the Executive Director, Place in consultation with the Cabinet Member for Business, Skills and Development and the Director of Finance to instruct the Director of Legal and Governance to finalise terms and complete all the necessary documentation to give effect to the proposals set out in this report.

10.3

Reasons for Decision

10.3.1

The underlying benefit of this proposal is to enable up to £3.5m of funding from Central Government to be invested in the City Centre to bring forward business incubation space for companies in the digital industries sector. Successful delivery of this space will support jobs growth and wealth creation in Sheffield and the wider City Region and as well as the ‘Tech Nation’ concept being promoted by Government. This is one of three Digital Business Incubators being supported by Government in the North, the others being in Manchester and Leeds.

10.3.2

It is expected that this funding will be used to secure and refurbish a property in the City Centre with the current option having been identified as Sheffield ‘Maker Hub’ – the renovation of Castle House (former Co-op) in Castlegate. This investment will add to the vibrancy and reinvigoration of the Castlegate area and wider City Centre and has economic benefits in terms of making the city an exciting place to locate and attract talented staff for businesses in the creative and digital industries which is a key growth area for the City Region.

10.3.3

The funding Government Department (DCMS) has assessed proposals from the promoters of this project in Sheffield and allocated £3.5m but is not in a position to invest directly into the project. SCC has been requested to act as an intermediary in the form of the Accountable Body for the funding and will not only receive the capital funding but will undertake appropriate detailed assessment to ensure the project delivers the most positive outcomes for the city and the technology sector. With Accountable Body status the Council will ensure the delivery body is fit for purpose and delivers the project and associated outputs in a legally compliant manner via a Funding Agreement.

10.4

Alternatives Considered and Rejected

10.4.1

Without SCC being in a position to act as Accountable Body for the capital funding it is understood that DCMS would not make the £3.5m grant funding available for investment in Sheffield. This would lead to the project not proceeding resulting in a missed opportunity to create the facility and stimulate the Sheffield economy.

10.4.2

The Council could look to use the £3.5m grant funding to deliver the facility itself through the Capital Programme rather than act as Accountable Body and enter into a Funding Agreement with a third party. Whilst this remains an option it is not preferred given it would make SCC wholly responsible for the financial delivery of the project and outcomes based on a business case that was developed by another party.

10.5

Any Interest Declared or Dispensation Granted

None

10.6

Reason for Exemption if Public/Press Excluded During Consideration

None

10.7

Respective Director Responsible for Implementation

Simon Green, Executive Director, Place

10.8

Relevant Scrutiny and Policy Development Committee If Decision Called In

Economic and Environmental Wellbeing Scrutiny and Policy Development Committee