Agenda item

The report informs the Committee of the proposed capital programme for 2025/26-2027/28.

Recommended                     -   That consideration be given to the report.

The Portfolio Holder for Resources, Councillor Alexander, submitted a report relating to the Council’s Capital Programme 2025/26 – 2027/28. 

The report sets out the Council’s capital programme for 2025/26 including forecast slippage on schemes from 2024/25 and the additions of new schemes to the Council’s Capital Programme for 2025/26.  The significant level of investment in previous years has only been possible by the Council obtaining external financial support, as well as the Council’s own effective financial management over recent years which has allowed it to have the funds necessary to finance these major projects when other funding has become available.  The new additions to the capital programme have reduced to £2.476m compared to £4.404m in 2024/25.  External funding of £1.538m has been confirmed towards the cost of the new capital schemes, Disabled Facilities Grant and UK Shared Prosperity Funding with a further £0.052m funding to be secured. 

The additions to the programme in 2025/26 will bring the total approved capital programme to £26.054m, including forecast slippage of the unspent programme from 2024/25 of £23.578m, which can be seen in Appendix 1 of the report.  The forecast slippage from the 2024/25 programme includes £4.555m for the Leisure Estate Investment Programme and £16.789m for the Levelling Up Programme.  The capital budgets for the Levelling Up Programme are based on the latest forecast of costs and are still subject to change.

The funding of the 2025/26 capital programme is based on the realisation of additional capital receipts during the year.  The programme assumes £3.092m of expenditure will be funded from capital receipts, of which £0.595m relates to the King George V Pavilion and pitches scheme which is contingent on funding from the disposal of land.  £1.147m in available receipts is forecast to be brought forward at the beginning of the year, leaving a target of £1.350m of new receipts which are required, which if not realised will need to be replaced by funding from earmarked reserves.

The capital programme currently excludes the proposed Huncoat Garden Village scheme which will be wholly funded from the Home England Brownfield Infrastructure and Land Fund grant of £29.898m.  When the funding agreement is approved, the capital and revenue costs of the scheme and associated funding will be submitted for inclusion in the Council’s revenue and capital budgets.

The expected new schemes for 2026/27 and 2027/28 (totalling £2.4m) are detailed in Appendix 3 of the report.  This is for information only as funding will need to be identified for these schemes before they are put forward for approval into the programme in future years.

The Council intends to continue its strong policies of financial management and look only to borrow what it needs to fund these major investment projects.  It will continue to rely on securing external sources of funding, using capital receipts, making revenue contributions to capital projects will use unspent monies to fund its programme.

The Revenue implications to finance the Capital Programme continue to be a key element in the affordability issues on the Revenue Budget this year.  The level of risk remains increased compared to previous years but the Council’s overall resources and management systems are believed to be sufficiently robust to effectively monitor these risks and take appropriate action, should it be required.

The Council will continue with its strategy to reduce debt wherever possible.

Members submitted a further question in advance of the meeting, in respect of further funding to support the cost of improvements to Oswaldtwistle Civic Theatre. 

The Committee was informed that the Council had allocated £267,000 in the Capital programme from 2024/25 to conduct works to the Theatre.  Additional costs would need to be found from external sources until a decision had been taken about the future use of the building.

Comments and questions were raised on the following issues by Members of the Committee, at the meeting, followed by responses from the Cabinet Portfolio Holders and the Executive Director, Resources:

-       Disabled facility grants

-       Parks and open spaces

-       Accrington Town Hall

-       Replacement of Christmas lights

-       Improvements to War Memorials

-       Clarification on the cost of free parking in the borough, to the Council

A member of the public submitted a further question, in respect of the Council’s capital strategy report.  The question and a response is set out below:

Recommendations 2.5 and 2.6 in the Capital Strategy report gives the Executive Director of Resources and the Leader of the Council, delegated powers to restructure cost centres and manage the movement of reserves.  What processes are in place to get approval from the Scrutiny Committee and the Full Council when changes to cost centres and reserves are being proposed?

Response:  The meeting was informed that no additional approvals would be required as the recommendations in the budget reports to Full Council included authority being delegated to the Executive Director of Resources, in consultation with the Cabinet Portfolio Holder for Resources, to release funding where deemed appropriate. 

Cabinet made the following recommendations to Council:

(1)   To approve the Capital Programme for 2025/26 including new scheme additions of £2,476,406 with a net cost to the Council of £886,000 as set out in Appendix 3 of the report.

(2)   To approve the funding of the programme by the use of newly anticipated direct external grants totalling £1,590,206 with the remaining funding of £886,000 to come from the Council’s resources.

(3)   To note the expected new scheme additions for 2026/27 and 2027/28.

(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 and Council Operations 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.

Resolved                               -   That the contents of the report be noted and supported.