Agenda item

This report presents the 2022/23 Financial Statements for the Council owned company Environment SK Ltd.

Councillor Paul Wood clarified that he was currently a Director of EnvironmentSK  Ltd and as the report was in his name, he would leave the Council Chamber if  required to. 

The Deputy Monitoring Officer informed Members that the report was for noting so there was no need for him to leave. 

Environment SK Ltd completed their 2022/23 final accounts ahead of the statutory deadline of 31 December 2023 and in accordance with the terms of reference the financial statements were presented to the Environment Overview and Scrutiny Committee. 

There was no requirement for the company accounts to be audited as the company qualified for an audit exemption as the annual turnover was below £10.2m and the value of assets was below £5.1 million. 

On 7 February 2023 Cabinet made the decision that the grounds maintenance service should transfer back to the Council in 2023/24 and approved the dissolution of the Council’s wholly owned companies EnvironmentSK Ltd and EnvironmentSK  Commercial Services Ltd. 

The company ceased trading on 31 March 2023 so this will therefore be the final set of financial statements that will be presented to this committee for 
EnvironmentSK Ltd. 

An independent valuation of the vehicles and equipment was completed on behalf of the company which resulted in the company receiving a capital receipt from the Council of £378k.  The company subsequentlypaid the capital receipt to the 

Council which enabled the outstanding loan to be reduced to a net balance of £132k at 31 March 2023.  

During discussion Members raised the following points: 

•      Some Parish Councils had not received any billing from EnvironmentSK Ltd for some considerable time for works carried out in their area.  Why was this? 

•      Were there any debts outstanding? 

•      How was the transfer process?  

The Assistant Director for Culture, Leisure andPlace informed the Committee that from April 2023 the service had been insourcedand therefore provided by a Council department.  This had slightly delayed the billing process, but bills had now been received by the Parish Councils.   

The Officer continued that there had been a full staff consultation on the changes to employment contracts.  Integrating two teams was not without difficulty but any issues were being worked through. 

The Head of Service for Revenues, Benefits, Customer and Community confirmed there was an outstanding loan balance of £132,000 which the Council would write off once the company had been dissolved. 

The Deputy Leader of the Council considered that EnvironmentSK Ltd was not particularly successful.  The original specification had required radical development and improvements had been made based on abetter understanding of grounds maintenance. 

Councillor Wood informed Members that two companies were originally set up, one of which took on a lot of commercial activities.  That company had not traded for the year 2022 – 2023 which was why there was no data on commercial services within the report.  The service was considered to be greatly improved by returning in-
house. 

It was AGREED that the Environment Overview and Scrutiny Committee noted the 2022/23 financial Statements for Environment SK Ltd.