Agenda Item No. 8(i)







C3088     Cardiff Capital Region – City Deal Proposal (L) (Scrutiny Committee - Corporate Resources) –


Cabinet was updated on the progress made since the report of 27 July, 2015 which provided an outline of the concept of City Deals and that summarised the work undertaken up to that point on a potential City Deal.


At the time of the earlier report in July 2015, the 10 South East Wales local authorities were still at the initial stages of negotiating a Cardiff Capital Region City Deal with the UK and Welsh Governments.  Since the report in July a considerable amount of work had been undertaken in relation to working towards a City Deal and the 10 local authorities were now at a critical point as the signing of a high level agreement was imminent.  This agreement would take the form of a 'Heads of Terms' that outlined the proposed structure of the City Deal in terms of governance, the scale of funds and areas of intervention.  The City Deal document would provide the foundation for more detailed work on a final programme of investment and mechanisms for delivery.


Since the Autumn of 2015, officers, with the assistance of advisors, (who had worked on previous City Deals) had been preparing a City Deal document.  The document was being used as a basis for challenge sessions to be held with the UK Government and with the Welsh Government.  Discussions would include setting out a strategic statement, the governance structure that would be at the core of any Deal to ensure that each constituent authority was committed to its delivery, the elements that made up the finance that was required as well as a series of interventions and themes for addressing across the region. These interventions and themes included improving connectivity, innovation, skills, regeneration and Business support.


The potential value of a City Deal stood at £1.28b over a 20 year period, with UK Government and Welsh Government contributing £580m each and the 10 local authorities contributing £120m.  The report clarified that at this stage there was a non-financial commitment from the 10 South East Wales local authorities whilst progress and discussing the terms of the Deal were ongoing.


In order that the case could be made for a City Deal in an effective manner, it was agreed by the ten local authority leaders that a Core Team of up to 6 individuals be established.  The core team included the three council leaders from RCT, Cardiff and Monmouthshire alongside 3 representatives from the Business and Higher Education sectors.


If the challenge sessions proved successful and the principles of a Deal accepted, it was likely that a formal announcement could be made as early as March of this year, with the formal signing of the City Deal document referred to in paragraph 10 of the report, taking place quickly thereafter.  If a Deal agreement was reached then additional work would be necessary to allow the working up of further detail. In signing the City Deal document, the Council would be committing to work with the other authorities, the Welsh and UK Governments to finalise detailed elements relating to the City Deal. Discussions would include matters related to project prioritisation, programming and how contributions to the City Deal would be made between the 10 authorities.  Consideration of all these matters would be brought to Council in due course.


The report noted that in the event an agreement was reached it would set out what financial contributions were from Welsh Government, UK Government and the ten local authorities on an "in principle" basis.  It would commit the constituent authorities to explore ways of delivering the principles as set out in a Heads of Terms document with the need to work up more detailed proposals, policies and projects. It would represent a signing, in principle, of a City Deal.  Recommendation 2 of the report sought endorsement for the Leader to sign this commitment, but only on the basis that it did not commit the constituent authority financially.  It merely committed the Vale of Glamorgan as one of the constituent authorities to explore further the ways of delivering the principles and objectives.  Only once each constituent authority was in full agreement to the specific proposals being put forward and was content to sign up to a more detailed proposal would it become binding.  This could take between 6 and 18 months.


At the meeting, the Managing Director stated that this issue was very flexible and constantly changing. He highlighted paragraph 8 of the report that “it was agreed by the ten local authority Leaders that a Core Team of up to 6 individuals be established. The core team includes the three council Leaders from RCT, Cardiff and Monmouthshire alongside 3 representatives from the Business and Higher Education sectors. Briefing sessions with the core team are currently taking place ahead of challenge sessions that at the time of writing are imminent”. He noted that this Core Team approach had already changed to now only Council Leaders holding separate challenge sessions with the UK and Welsh Governments; progress could be quick after those meetings. He concluded by stating that an “in principle” document was required for the process, however this was not financially or legally binding, and only when all relevant authorities had signed “in principle” documents, would Full Council approval be needed to formally progress the matter.


This was a matter for Executive decision


Cabinet, having considered the report and all the issues and implications contained therein




(1)       …………….


(2)       …………….


(3)       …………….


(4)       …………….


(5)       T H A T the report be referred to Council on 2 March, 2016 for information purposes, with the Leader providing a verbal update on any progressed matters.


Reasons for decisions


(1)       …………….


(2)       …………….


(3)       …………….


(4)       …………….


(5)       To update all members.



Report to Cabinet