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Publication - Guidance

Community Empowerment (Scotland) Act 2015: asset transfer guidance for community transfer bodies

Published: 10 Nov 2016
Part of:
Communities and third sector
ISBN:
9781786525932

Guidance for community bodies on the statutory asset transfer scheme.

101 page PDF

812.2kB

101 page PDF

812.2kB

Contents
Community Empowerment (Scotland) Act 2015: asset transfer guidance for community transfer bodies
13. Assessment of asset transfer requests

101 page PDF

812.2kB

13. Assessment of asset transfer requests

Introduction

13.1. When the price offered in an asset transfer request is less than the market value of the property, the relevant authority will need to consider whether the proposed benefits to be delivered by the community transfer body justify the proposed discount (which will be accounted for as a "gift"). This will be based solely on the analysis of the information included in the request. The benefits of the request should be proportionate to the value of the asset and the level of discount, with an appropriate level of information to support the application. Any decision to transfer an asset must represent good use of public resources.

13.2. This chapter is included to inform community transfer bodies of how relevant authorities may approach the assessment of requests.

Criteria for Assessing Requests

13.3. A way to demonstrate resources are being put to good use is to demonstrate Best Value [3] . Best Value is the requirement to make arrangements to secure continuous improvement in performance whilst maintaining an appropriate balance between effectiveness and economy. It also requires due regard to equal opportunities requirements, and to contribute to the achievement of sustainable development.

13.4. There are seven Best Value themes (see the table below) and public bodies across Scotland have a duty to secure Best Value for public money and can sell, or lease, at less than market value where there are wider public benefits to be gained from a transaction. In making a case for the transfer of an asset, the Best Value themes will be evident, to a greater or lesser extent, in the community transfer body and the related benefits that will accrue in pursuing positive outcomes for a more prosperous and fairer Scotland. The matters which the relevant authority must consider include the following types of benefit:

  • Economic development
  • Regeneration
  • Public health
  • Social wellbeing
  • Environmental wellbeing
  • Reducing inequalities of outcome from socio-economic disadvantage
  • Any other benefits that might arise through the alternative use of the asset.

13.5. Asset transfer at less than market value is justified when these additional benefits empower communities and align with local and national priorities to enable the delivery of Best Value across the public sector as a whole. Such benefits are likely to align with one or more of the Scottish Government's National Outcomes [4] , which all Scottish public authorities are required to have regard to in carrying out their functions (under Part 1 of the Act). They may also contribute to the relevant authority's policy objectives or local priorities determined through Community Planning, but the value of benefits should be judged on a broad basis, not only in relation to the particular authority to which the request is made.

Considering the Request

13.6. The information provided in the asset transfer request should demonstrate that the project has clear objectives, including the projected outcomes and impacts sought by the community transfer body alongside any associated dependencies, constraints and risks identified. The benefits of the request should be proportionate to the value of the asset and the level of discount sought.

13.7. Each one of the seven Best Value themes should be explored with the evidence provided used to evaluate the strength of the case being made, including the sustainability of the proposal in the longer-term (see table below). The request must also include the benefits that will be delivered as part of the proposal (see paragraph 13.3) which can come in a variety of forms:

Benefit

Example

Assessment

Financial

Reduction in public sector costs or enhancement of provision due to the proposal.

e.g. the costs associated with volunteers' time or where intervention can reduce pressure on municipal services through the people that can be reached, such as alleviating alcohol/drug/ smoking dependency.

Outcomes - quantitative

Contribution towards local or national priorities e.g. improved standards of healthcare; contribution towards alleviating homelessness; supporting local employment etc.

e.g. the increase in local engagement in physical activity for a particular group or groups; the reduction in numbers of homeless through intervention/advocacy; the hours of vocational training provided to help develop skills that are in demand.

Outcomes - qualitative

Improved community cohesion; enhanced local services etc.

e.g. the improvement in local wellbeing from reducing anti-social behaviour; the increase in participation from a marginalised group or groups, such as providing online access or financial independence.

13.8. In reviewing each request the following matters, though not exhaustive, should be considered:

a) Value to relevant authority in existing use

  • feasibility and cost of relocation of services elsewhere
  • potential revenue savings arising from transfer

b) Value for alternative use/redevelopment

c) Value for proposed and other community purposes

d) Level of community benefits

  • extent of community served
  • Nature of benefits to be delivered
  • links to relevant authority's corporate priorities and outcomes
  • community need/demand for the services

e) Likelihood that benefits will be delivered over a 5-year period

  • strength of organisation
  • sustainability of business plan/project
  • sources and level of funding support

f) Impact of project failure

  • to surrounding local environment
  • to reputation of the parties
  • to the service users/relevant authority's objectives

13.9. The request will then be assessed in terms of the evidence provided:

Evidence

Overview

Very strong

Governance and financial arrangements are strong and sustainable. Best Value characteristics are evidenced and contained throughout the overall approach. Related projected benefits are very robust and demonstrate value for money: suitability, effectiveness, prudence, quality, value and the avoidance of error and other waste.

Strong

Governance and financial arrangements are sound and sustainable. Best Value characteristics are in evidence in the proposal. Related projected benefits are demonstrated well and represent value for money.

Moderate

Governance and financial arrangements are in place and acceptable. Best Value characteristics have been considered as part of the proposal. Related projected benefits are acceptable and could lead to value for money.

Weak

Governance and financial arrangements are weak. Best Value characteristics are not well demonstrated in the proposal. Related projected benefits are not based on roust information and demonstrates questionable value for money.

Poor

Governance and financial arrangements are poor. There is little evidence of Best Value characteristics in the proposal. Related projected benefits are ill defined and/or unrealistic and do not demonstrate value for money.

13.10. The strength of the proposals will then be considered against the financial implications of any decision both for short-term budget planning and long-term asset strategies. This will include the consideration of the current use of the asset and any consequent implications that could arise from the transfer of the asset. A larger discount will require a stronger case to be made with an appropriate level of benefits demonstrated effectively.

Asset Transfer Request Recommendation

13.11. Following a detailed review and assessment of the information provided in an asset transfer request, a recommendation can then be made on the strength of the case to the relevant accountable officer. It may be appropriate for a relevant authority to consider weighting the various matters in its consideration of an asset transfer request in order for it to reach a clear judgement.

13.12. Depending on the nature of a request, expert opinion may need to be sought to assess effectively the financial implications, the Best Value considerations and/or the proposed benefits.

13.13. The community transfer body needs to provide a proportionate request that demonstrates clear benefits with the appropriate level of information to support the application - commensurate to the value of the asset and the level of discount.

13.14. Any asset transfer request should be assessed alongside any other proposals for the related asset to enable a Best Value judgement to be made. This will be a judgment that takes into account the financial implications alongside the wider benefits that will accrue in pursuing local or national priorities to deliver improved outcomes for Scotland.

Best Value Theme

Summary

Information Required

  • Vision and Leadership

An organisation will have in place a clear vision and plan for what it will do to contribute to the delivery of improved outcomes for Scotland. This may be linked to one or more local or national priorities e.g. the Scottish Government's National Outcomes.

A clear plan for achieving the intended outcomes, ideally showing links to local or national priorities. Members of the community transfer body would also show that they have the relevant skills and experience to deliver the intended objectives.

  • Effective Partnerships

An organisation will show how it, and its partnerships, provides a collaborative approach to the challenges that communities face.

The detail of any partnerships in place to help ensure successful delivery of the intended benefits. Community support is vital and can be shown through a variety of metrics such as surveys, consultations or ballots.

  • Governance and Accountability

An organisation will be able to demonstrate structures, policies and leadership behaviours that support the application of good standards of governance and accountability.

An outline to illustrate that the appropriate structures and policies are in place to help ensure success in the longer-term.

  • Use of Resources

An organisation will show how its effective management of all resources (including staff, assets, and information) is contributing to the delivery of specific outcomes, highlighted in the national outcomes.

Explain how the body's current and future resources will be used as part of a medium to long term plan (5-10 years). This could include the numbers of employees or volunteers and the maintenance of any asset. This could also include the funding requirements of the group and the sources of funding already in place.

  • Performance Management

An organisation will ensure that robust arrangements are in place to monitor the achievement of its desired outcomes as well as any reporting arrangements.

Outline the way in which a community transfer body will be able to monitor the achievement of its objectives, whether that be recording volunteers time or the amount of benefit achieved as part of the overarching vision. To demonstrate openness and transparency it will be important to report performance to the community.

  • Sustainability

An organisation will demonstrate an effective use of resources in the short-term and an informed prioritisation of the use of resources in the longer-term in order to contribute to sustainable development. The goal of Sustainable Development is to enable all people throughout the world to satisfy their basic needs and enjoy a better quality of life without compromising the quality of life of future generations.

There are five broad principles of sustainability:

  • promoting good governance;
  • living within environmental limits;
  • achieving a sustainable economy;
  • ensuring a stronger healthier society; and
  • using sound science responsibly.

A community transfer body could demonstrate how its future funding or self-financing arrangements are to be achieved. Any proposal could also include any positive impact on the natural environment.

  • Equality

An organisation will demonstrate that consideration of equality issues is embedded in its vision and strategic direction and throughout all of its work.

The community transfer body should establish that the different groups within the community have had their different needs taken into account. Any request should include where a proposal may be reducing inequalities of outcome from socio-economic disadvantage.


Contact

Email: Jean Waddie

Phone: 0300 244 4000 – Central Enquiry Unit

The Scottish Government
St Andrew's House
Regent Road
Edinburgh
EH1 3DG