Agenda item
Capital Programme 2024/2025 to 2026/2027
Report attached.
Minutes:
Members considered a report of Councillor Peter Britcliffe, Deputy Leader of the Council and Portfolio Holder for Resources, informing the Cabinet of the proposed Capital Programme for 2024/25 - 2026/27.
Councillor Steven Smithson commented that he was pleased to support the Programme, which included numerous projects, such as the refurbishment of Oswaldtwistle Civic Theatre and Rhyddings Park Play Area, as well as works at Jackhouse Nature Reserve and King George V Playing Fields pavilion and pitches. Councillors Younis welcomed the overall investment in Hyndburn and thanked those involved in developing the projects. Councillor Pratt was particularly keen to support the King George V development, which could facilitate a move there by Accrington Amateur Football Club, thereby freeing up their Livingstone Road ground for potential sale to Accrington Stanley FC.
The Chair expressed his delight at the proposed Capital Programme and was pleased that the ambition to reopen the Civic Theatre had received cross-party support at the recent Council meeting.
Approval of the report was not considered to be a key decision.
Reasons for Decision
The report and its main Appendix set out the Council’s Capital Programme for 2024/25, including forecast slippage on schemes from 2023/24 and the additions of new schemes to the Council’s Capital Programme for 2024/25.
The significant level of investment in previous years had only been possible by the Council obtaining external financial support, as well as the Council’s own effective financial management over recent years, which had allowed it to have the funds necessary to finance these major projects when other funding had become available.
The new additions to the Capital Programme for 2024/25 had reduced to £4.404m, compared to £8.374m in 2023/24. External funding of £2.543m had been secured towards the cost of these new capital schemes.
The additions to the Programme in 2024/25 would bring the total approved capital programme to £36.104m, including forecast slippage of the unspent Programme from 2023/24 of £31.700m, which could be seen in Appendix 1 of the main report. The forecast slippage from the 2023/24 programme included £10.885m for the Leisure Estate Investment Programme and £17.116m for the Levelling Up Programme, which were projects that were expected to be ongoing for the next 1-2 years.
The Council intended to continue its strong policies of financial management and to look only to borrow what it needed to fund these major investment projects. The Council would continue to rely on securing external sources of funding, using capital receipts, making revenue contributions to capital projects and would use unspent monies to fund its programme. It would also apply a rigorous approach to selecting projects by examining all proposals against its corporate objectives and only selecting the most pressing and deserving projects to fund. This was in accordance with Council policy.
The Revenue implications to finance the Capital Programme continued to be a key element in the affordability issues on the Revenue Budget this year. The Programme contained a limited amount of risk this year. The level of risk remained elevated compared to previous years due to the size of programme. However, to further reduce the risk the Council had supplemented its own project management and cost control capacity by the appointment of experienced professionals in both disciplines for its two largest projects. The Council’s overall resources and management systems were believed to be sufficiently robust to effectively monitor these risks and ensure appropriate action was taken if they should materialise.
The Council would continue with its strategy to reduce its level of debt wherever possible by restricting borrowing and repaying debt and would continue to work extensively with external funders to bring forward realistic plans for Capital investment in the area.
A detailed report on the Capital Programme was provided as an Appendix to the covering report, which set out information on the following:
- Summary of the major additions to the Capital Programme;
- Improving the management of Capital Investments;
- Conclusion;
- Appendix 1 - Capital Programme 2024/25 (Summary);
- Appendix 2 - Capital Programme 2024/25 (Detailed); and
- Appendix 3 - Capital Programme 2024/25 (New Additions).
Alternative options considered and the reasons for rejection
A wider programme of funding had not been considered due to the Council’s policy commitment to limiting capital expenditure to affordable levels and seeking to repay debt.
Resolved - That Cabinet recommends to Council:
(1) To approve the Capital Programme for 2024/25 including new scheme additions of £4,404,015 with a net cost to the Council of £1,861,000 as set out in Appendix 3 of the Appendix to the covering report.
(2) To approve the funding of the programme by the use of newly anticipated direct external grants totalling £2,543,015 with the remaining funding of £1,861,000 to come from the Council’s resources.
(3) To note the expected new scheme additions for 2025/26 and 2026/27.
(4) That delegated authority is given to the Executive Director (Resources), in consultation with the Portfolio Holder for Resources to flex the programme in accordance with the available funding, provided this does not require any additional borrowing.
(5) That the individual projects with the Capital Programme require the written authorisation of the Executive Director (Resources) following consultation with the Portfolio Holder for Resources before commencing and incurring expenditure and that Service Managers provide the Executive Director of Resources with written details of estimated costs of schemes with full justification of the need and benefits from undertaking the capital investments before approval is provided and that approval to commence is delegated to the Executive Director (Resources), in consultation with the Portfolio Holder for Resources. That where he deems it appropriate, the Executive Director (Resources) be given authority to release funding in stages to ensure effective financial control can be maintained and the project risk managed.
(6) That in-year underspends are not made available to fund new projects during the year
Supporting documents: