Agenda item

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Officers presented the Capital Estimates report which revised the 2022/2023 projections for spending on the capital programme, set out an estimate of capital resources available for 2022-2027, detailed new capital bids to be included in the programme and outlined provisional figures for capital expenditure for the period 2022-2027.

The Chair thanked officers for their report and invited questions and comments, as summarised below.

Some questions had been submitted in advance as follows:

It was suggested that the reserves be held at the current figures as they were under threat.  The expenditure per annum may be overstated as the forecast had been reduced from £69m to £35m.  It was reported that reserves would be on hold pending evaluation to support the budget proposals set out in the financial plan.

More information was requested on the Capital Financing Requirement against the backdrop of costs escalating over time and a potential funding gap that would need covering.  It was reported that there was an increase in unsupported borrowing requirement built into the financial plan based on the current programme and projections.  Projects would undergo reassessment  and financial implication would be determined through the decision making channels.  A breakdown of the financing requirement could be seen at section 4.7.1 of the financial plan.

With regard to what assets would exist against unsupported borrowing, it was reported that these funding streams supported a number of projects in the capital programme, the detail for which would be provided in a separate table to follow.

A question was asked on what the predicted deficits of the major housing projects were.  This was covered earlier in the meeting.

In response to a question on what the options for disposal of assets, it was confirmed that there was currently no strategy in place  to deal with the disposal of assets and no proposals in the financial plan for such  other than the housing development.

Following a question on the cost of de carbonisation, it was explained that this was being looked at and would be responded to when the information was available.

A question was asked on where the underwriting of the Guildhall and Parkway deficit.  The funding of the Capital programme was set out in section 7 of the Capital programme report, although the detail of funding against each capital project would follow.

In response to a question on the cost of operational schemes attention was drawn to Appendix 2 of the Capital Programme report which listed each project.

In response to a question of how the leisure refurbishment was funded, it was explained that it was through various schemes -  capital receipts, unsupported borrowing, grants and reserves.  The detail of the funding against each project would follow.

A question was raised on whether risk assessments had been carried out on various strategies.  It was noted that emerging pressures continued to be updated and reflected in the corporate risk register and project registers. There was a mix of costs the either had or had not been included in service lines depending on delivery stages.  Also, a number of projects would be included as part of the cost management and income generation plan  to be developed during the year  to be incorporated into the Medium Term Financial Plan to address the budget gap in 2026/27.

Councillor Morley raised the issue of projected spend on capital projects, it was acknowledged that this was something he had previously raised and was taken on board with the continuing challenge of getting up to date figures.

Under standing order 34 Councillor Kemp asked where the £3m deficit for the Guildhall was shown in the budget, to which it was explained that at the moment it was shown as unsupported borrowing waiting to see if more funding would be gained from other sources.

Councillor Sampson asked of the situation with the future budget shortfall for year 4 was comparable with other authorities and what was being put in place to manage it.  In response it was explained that work would be ongoing to address it looking at investment opportunities for revenue, cost management , service expenditure and efficiencies.

It was noted that many other authorities were in the same situation and some were drawing down on reserves if they could or raising fees and charges.

The S151 Officer reported that since the reports were published for this meeting some changes had taken place with the Cabinet papers where formatting had taken place, in particular the content in some of the appendices had been re-ordered into alphabetic order.  Also, some amendments were required to the Capital Programme report where a table would be provided to show the changes.

The meeting did not exclude the press and public but ensured debate was kept in the public domain. 

On being put to the vote there were 4 abstentions.

RESOLVED: That the Joint Panel support the recommendations to Cabinet as set out below:

It is recommended that:

1) Cabinet recommends to Council the amendments to capital schemes and resources for the 2022-2027 capital programme as detailed in the report.

2) Cabinet recommends to Council that new capital bids are to be funded from available capital resources and included in the capital programme 2022-2027 as detailed in the report.