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Issue - decisions

Discretionary Support for Inward Investment

20/02/2020 - Discretionary Support For Inward Investment

9.1

The Executive Director, Place, submitted a report seeking support for the provision of financial encouragement for inward investment into Sheffield in return for social and economic benefits and, specifically, seeking approval to (a) a delegated arrangement to provide support for inward investment developments where such support demonstrates value for money and brings tangible benefits to the City and (b) the provision of a grant of £500,000 to secure an inward investment in to the Lower Don Valley that will generate over 1,500 jobs, and up to a £309,500 contribution towards a grant that will create 90 jobs at Parkwood Springs.

 

 

9.2

RESOLVED: That Cabinet:-

 

 

 

(a) endorses, in principle, the approach to encourage inward investment where such an investment can demonstrate value for money and social and economic benefits for the City;

 

 

 

(b) to the extent not covered by existing delegations, delegates authority to the Executive Director of Place, in consultation with the Cabinet Member for Business, Skills and Development, the Cabinet Member for Finance, Resources and Governance, and the Director of Finance and Commercial Services, to make specific decisions on providing support for inward investment proposals that meet the following conditions:-

 

  • The proposed financial support is for genuine inward investment activity that will be new to the City.
  • A value for money assessment, including the social and economic benefits, is included as part of the consultation with the nominated Cabinet Members;

 

 

 

(c) approves a £500,000 inward investment grant to Clipper Logistics Plc in respect to their investment at Shepcote Lane; and

 

 

 

(d) approves a contribution of up to £309,500 to Skyline Luge Sheffield in respect to a grant of £619,000 being provided by the Sheffield City Region Combined Authority (SCRCA) for their investment at Parkwood Springs.

 

 

9.3

Reasons for Decision

 

 

9.3.1

Inward Investment has the opportunity to bring significant social and economic benefits to the City. In order to help attract and secure inward investment the Council has the ability to provide grant funding either through a direct grant to the investor or through a contribution to a grant provided by the Sheffield City Region Combined Authority Business Investment Fund where that is required. The benefits of supporting inward investment in this manner can include job creation, improved wages, bespoke travel arrangements, training programmes and the development of local supply chains with existing local businesses.

 

 

9.3.2

In order to ensure the Council has the ability to act quickly and in confidence with potential inward investors, it is proposed that delegated arrangements are established to enable grants to be provided where a value for money case can justify the investment.

 

 

9.3.3

In order to secure a £20m investment at Shepcote Lane that has now created over 1,500 jobs, approval from the Council is sought to confirm the provision of £500,000 to the investor. In addition, up to £309,500 is required to support a £619,000 grant from the SCRCA towards an investment at Parkwood Springs that has the potential to create 90 jobs and create a new major leisure attraction in the City.

 

 

9.4

Alternatives Considered and Rejected

 

 

9.4.1

Being able to respond quickly, efficiently and with confidence to an inward investment enquiry is considered important to securing the investment together with the social and economic benefits that would result. Retaining existing approval arrangements is an option, however it is considered that the delegated arrangements outlined in the report would provide certainty to negotiations with inward investors which in turn would increase the likelihood of securing such an investment in Sheffield.

 

 

9.4.2

No threshold for the size of grant to be agreed under the delegation has been identified. It is considered that an assessment of affordability alongside the economic and social benefits resulting from the investment will form part of the assessment process prior to consideration by the Members and Officer with delegated authority.

 

 

9.4.3

With regard to the Skyline Luge grant, the SCR funding will not be provided without the contribution from SCC. The overall grant will look to secure the Skyline investment in Sheffield rather than a number of other sites they are considering in the UK and across Europe.

 

 

9.4.4

In respect to the Clipper grant, the risk of not providing the grant would be significant reputational damage having indicated the funding would be forthcoming. The occupier, Pretty Little Thing, has delivered against the expectations associated with the grant offer and delivered significant benefits to the local community.

 

 

9.5

Any Interest Declared or Dispensation Granted

 

 

 

None

 

 

9.6

Reason for Exemption if Public/Press Excluded During Consideration

 

 

 

None

 

 

9.7

Respective Director Responsible for Implementation

 

 

 

Laraine Manley, Executive Director, Place

 

 

9.8

Relevant Scrutiny and Policy Development Committee If Decision Called In

 

 

 

Economic and Environmental Wellbeing