Agenda item

Report attached.

Members considered a report of Councillor Vanessa Alexander, Portfolio Holder for Resources and Council Operations, setting out the proposed capital programme for 2026/27 – 2028/29.

Councillor Alexander introduced this report, highlighting key figures for new additions to the programme, slippage from previous years and the total cost of the Capital Programme in 2026/27 of £38.5m.  She also outlined some key projects including the following:

• War Memorial Restoration;
• Maden Street Clock Tower Lighting;
• Christmas Decorations;
• Huncoat Garden Village Scheme;
• ICT Projects;
• Levelling Up Projects;
• Sport Facilities;
• Operational Buildings;
• Parks and Play Areas; and
• Pride in Place Projects

Councillor Clare Pritchard spoke about the importance of Disabled Facilities Grant (DFG) projects and gave an example of a recent case in which she had been involved where a resident’s quality of life had been enhanced.  She placed on record her thanks to Sarah Whittaker, Regeneration Manager, for her assistance.  Councillor Fisher was also pleased to see this grant being utilised, but noted that, unfortunately, adaptations did take some time to implement.

Councillor Zak Khan made some comments and asked a number of questions, as follows:

• He was pleased to note that a large number of Pride in Place schemes had been proposed.  He asked what consultations had taken place about the schemes to be supported and what schemes had been rejected.
• Who had determined the Community Projects and Neighbourhood Projects identified?
• Did the IT Projects identified include provision for livestreaming meetings?  Response: As reported previously, this scheme had not been agreed on the grounds of value for money.  However, it was understood that one councillor had offered to undertake livestreaming using their own portable equipment.
• The support for Mercer Hall and Accrington Stanley Community Trust (ASCT) was noted.  He asked if there would be a formal agreement with ASCT about the schemes to be funded.  -  Response: ASCT were due to make an announcement on this subject shortly.
• He was pleased to note the investment in the Brookside Restoration Project.  In respect of investment in Parks and Open Spaces.  Would the funding be spread across many parks, or focused on a small number of schemes?  -  Response: Support for parks and open spaces was a priority and the intention was to spread the funding evenly across the Borough, in so far as this was possible.  One park in Accrington and one park in Rishton were due to be refurbished.
• Who determined allocations from the Cabinet Action Fund?

Councillor Dad responded that for programmed schemes all Cabinet members were involved in the decisions.  Discussions had taken place with stakeholders, including the Neighbourhoods Board.  Ward councillors had also spoken to individuals representing local communities.  Councillor Whitehead added that for some Neighbourhood Improvement Projects the funding had not yet been allocated.  There would be some small areas that required capital investment to make a difference, but no monies had yet been earmarked for specific schemes

Approval of the report was not deemed a key decision.

Reasons for Decision

The report set out the Council’s Capital Programme for 2026/27, including forecast slippage on schemes from 2025/26 and the additions of new schemes to the Council’s Capital Programme for 2026/27.

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 2026/27 had increased to £7.860m (including £1.020 leasing costs), compared to £2.476m in 2025/26.  External funding of £3.20m had been confirmed towards the cost of these new capital schemes (Disabled Facilities Grant, Extended Producer Responsibility Grant (EPR) and Pride In Place Impact Grant) with a further £0.03m funding to be secured.

The additions to the programme in 2026/27 would bring the total approved capital programme to £38.565m, including forecast slippage of the unspent programme from 2025/26 of £30.706m, which could be seen in Appendix 1 of the detailed report at Appendix A.  The forecast slippage from the 2025/26 programme included £22.366m (£3.815m slippage to 2027/28) for Huncoat Garden Village, £0.40m for the Leisure Estate Investment Programme and £6.251m for the Levelling Up Programme.  The capital budgets for the Levelling Up Programme were based on the latest forecast of costs however as these were not tendered figures, they were still subject to change and should there be any changes to the current forecast, these would be reported during the year.

It was important to note that the Council funding of the 2026/27 Capital Programme was based on using Council reserves and potential capital receipts.  There would be a continued emphasis relating to the realisation of additional capital receipts during the year.  The programme assumes £3.010m of expenditure would be funded from capital reserves, and £0.6m from unfunded receipts.  Any new receipts received would replace the funding required from these reserves.

The small number of expected new schemes for 2027/28 and 2028/29 (totalling £1.910m) were detailed in Appendix 3 of the report.  This was for information only, as funding would need to be identified for these schemes before they were put forward for approval into the programme in future years, alongside any Local Government Reorganisation (LGR) consequences.

The Council intended to continue its strong policies of financial management and look only to borrow what it needed to fund 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 increased compared to previous years due to the size of the overall 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 Appendix A 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 2026/27 (Summary);
• Appendix 2 - Capital Programme 2026/27 (Detailed);
• Appendix 3 - Capital Programme 2026/27 (New Additions); and
• Appendix 4 – Capital Programme 226/27 – Pride in Place

Alternative Options Considered and Reasons for Rejection

A wider programme of funding/borrowing 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 the Council:

(1)    To approve the Capital Programme for 2026/27 including new scheme additions of £7,860,041 with a net cost to the Council of £3,609,970 as set out in Appendix 3 of Appendix A to the report.

(2)    To approve the funding of the programme by the use of newly awarded direct external grants totalling £3,229,909, lease vehicle borrowing costs £1,020,165 and the remaining funding of £3,609,970 to come from the Council’s resources.

(3)    To note the expected new scheme additions for 2027/28 onwards set out in Appendix 1 of Appendix A to the report.

(4)    To give delegated authority to the Executive Director (Resources), following consultation with the Portfolio Holder for Resources and Council Operations to flex the programme in accordance with the available funding, provided this does not require any additional borrowing.

(5)    To agree that the individual projects within the Capital Programme will 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 must provide the Executive Director (Resources) with written details of estimated project costs and a full justification of the need for and benefits from undertaking the capital expenditure before such approval is provided; and that the ability to approve commencement of capital projects is delegated to the Executive Director (Resources); in consultation with the Portfolio Holder for Resources and Council Operations and that the Executive Director (Resources) is given delegated authority to release capital funding in stages if deemed appropriate to ensure effective financial control and risk management.

(6)    To agree that in-year underspends will not be made available to fund new projects during the year.