#CATJRF: Opportunity for creating permissive rules for Northern Ireland?

Whilst I’m being single-minded about this, one of the issues identified by Maurice Kinkead is why are civil servants so cautious about handing over assets?

Now bear in mind that Treasury rules don’t directly apply to the NICS, but these HMT guidelines from 2008 go some way to explain why in England and Scotland the main players in transferring assets to communities are at council level, rather than ministerial departments (those that may also reflect a difference in value and scale of the assets themselves):

2.4 Determine the social value of asset disposal by:

• assessing the asset’s current market value, including any premium arising from risk diversity, and net off the transaction costs associated with a sale.

To do this, it is necessary to ensure – before invitations to potential bidders – that:

– an efficient market exists for this kind of asset and that the market is functioning efficiently and is of a sufficient size to absorb a sale without distortion.

– the asset sale will be executed in such a way as to capture best pricing.

– the transaction costs are proportionate.

– the asset sale (including any structuring of the asset) takes account of a market-consistent assessment of risk and is structured and designed in such a way as to promote the best possible efficient pricing, avoiding information asymmetry or other factors which may disadvantage buyers.

– possible efficiency gains or losses that may be expected to arise from disposal to the private sector are taken into account.

• assessing possible efficiency gains or losses that may be expected from disposal, including the effectiveness of any competitive or regulatory regime that is likely to follow from asset disposal.
• assessing any other social cost and benefits that may arise due to disposal.

These are a complex set of commercial and best value considerations that may have the effect of discouraging civil servants to take positive decisions around these issues. However, Northern Ireland has options to put this is on the work bench and consider just what kind of options it wants, as opposed to those formed in Whitehall.

It’s something I think can be usefully raised in discussion at tomorrow’s seminar at the Farsett Community Centre.

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  • cynic2

    “why are civil servants so cautious about handing over assets?”

    Perhaps because, in Northern Ireland, the Civil Service:

    1 is 20 years behind the curve in the rest of the UK
    2 isnt very competent
    3 shifts all the responsibility to Ministers who are weak and fearful