Agenda item

Decision:

Subject to Council approving the budget on 9 February 2022:

1.     That the following schemes be removed from the capital programme:

a)    SMC Ph 3 - £5.895 million, keeping £150,000 on the provisional programme.  The £5.895 million will move onto the capital vision

b)    Stoke Park masterplan enabling costs – PL56(p) - £500,000 – will move to the vision and come back with an updated business case

c)     Sports Pavilions replace water heaters (PL58(p)) £154,000 – will come back with a further bid if required

2.     That the new bids, as shown in Appendix 2 to the report submitted to the Executive be included in the provisional capital programmes.

3.     That £10.124 million for Foxburrows scheme be transferred from the HRA provisional programme to the HRA approved programme.

4.     That the affordability limit for schemes to be funded by borrowing be agreed as set out in paragraph 4.31 of the report and in Appendix 1 thereto.

5.     That the remit of the Strategic property fund budget be widened to allow estate redevelopments to be funded from the budget.

The Executive made the following recommendations to Council (9 February 2022):

1.     That the General Fund and HRA capital estimates, as shown in Appendices 3 to 12 to the report be approved, as amended to include the bids approved by the Executive at its meeting on 25 January 2022.

2.     That the Minimum Revenue Provision policy, referred to in section 5 of the report, be approved.

3.     That the capital and investment strategy be approved, specifically the investment strategy and Prudential Indicators contained within the report and Appendix 1.

4.     That the updated flexible use of capital receipts policy at Appendix 17 be approved.

Reasons:

1.     To enable the Council to approve the capital and investment strategy for 2022-23 to 2026-27

2.     To enable the Council, at its budget meeting on 9 February 2022, to approve the funding required for the new capital schemes proposed

Other options considered and rejected by the Executive:

None.

Details of any conflict of interest declared by the Leader or lead councillors and any dispensation granted:

None.

The capital and investment strategy gave an overview of how capital expenditure, capital financing and treasury management activity contributed to the provision of local public services.  The strategy also detailed how associated risks were managed and the implications for future sustainability. Decisions made presently and during the period of the strategy on capital and treasury management would have financial consequences for the Council for many years into the future.

The Executive considered a report which included details of the capital programme, new bids or mandates submitted for approval; plus the requirements of the Prudential Code and the investment strategy covering treasury management investments, service investments and commercial investments.  The report also covered the requirements of the Treasury Management Code and the prevailing Department for Levelling Up, Housing and Communities (DLUHC) Statutory Guidance.

The Lead Councillor for Resources introduced the report.

Capital and the treasury were heavily interlinked. The strategy included non?commercial and investment information as required by the government and the Chartered Institute of Public Finance and Accountancy (CIPFA). The report included the General Fund and the Housing Revenue Account (HRA) capital programmes. The revised CIPFA prudential and treasury codes had been published in December and the changes would be incorporated in the 2023-24 report. The Government had announced an extension to the use of flexible capital receipts policy and the Executive was asked to approve this for use against the Council’s transformation programmes. There were new bids to the General Fund of £16.6 million over the five-year period increasing the Council’s underlying need to borrow to £316 million. The affordability calculation had been updated for the year showing the net cost of the non-income generating schemes and the availability of in year resources to fund borrowing costs. There were risk indicators throughout the report and appendices as were prudential indicators.

The HRA capital programme was anticipating a £24.5 million spend on renovation and repairs of the Council’s housing stock due to changes in legislation and to catch up following delays during the past two years caused by the pandemic. A number of other smaller schemes were progressing whilst some needed additional budget. Those schemes could be moved from the provisional budget to be delivered.  The investment budget stood at £1.2 million for 2022-23 and interest paid was £5.74 million, £5 million of which was in the HRA.

The Joint Executive Advisory Board (JEAB) had been invited to consider this report at its meeting held on 10 January 2022 and the comments arising were set out in the Supplementary Information Sheet. Councillor Ruth Brothwell chaired the JEAB meeting and was in remote attendance. Councillor Brothwell confirmed that the JEAB review of the report had been thorough and had nothing further to add.

At its meeting held on 20 January 2022, the Corporate Governance and Standards Committee had considered the Capital and Investment Strategy and had endorsed the recommendations to the Executive and Council (as set out in the Executive report), and the comments arising during the debate were set out in the Supplementary Information Sheet.

The Executive,

RESOLVED:

Subject to Council approving the budget on 9 February 2022:

(1)    That the following schemes be removed from the capital programme:

a)    SMC Ph 3: £5.895 million keeping £150,000 on the provisional programme. The £5.895 million will move onto the capital vision

b)    Stoke Park masterplan enabling costs: PL56(p) £500,000 will move to the vision and come back with an updated business case

c)    Sports Pavilions replacement water heaters: PL58(p) £154,000 will come back with a further bid if required

(2)  That the new bids as shown in Appendix 2 to the report submitted to the Executive be included in the provisional capital programmes.

(3)  That £10.124 million for Foxburrows scheme be transferred from the HRA provisional programme to the HRA approved programme.

(4)  That the affordability limit for schemes to be funded by borrowing be agreed as set out in paragraph 4.31 of the report and in Appendix 1 thereto.

(5)   That the remit of the Strategic property fund budget be widened to allow estate redevelopments to be funded from the budget.

The Executive also made the following recommendations to Council (9 February 2022):

(1)  That the General Fund and HRA capital estimates, as shown in Appendices 3 to 12 to the report be approved as amended to include the bids approved by the Executive at its meeting on 25 January 2022.

(2)  That the Minimum Revenue Provision policy referred to in section 5 of the report, be approved.

(3)  That the capital and investment strategy be approved, specifically the investment strategy and Prudential Indicators contained within the report and Appendix 1.

(4)  That the updated flexible use of capital receipts policy at Appendix 17 be approved.

Reasons:

To enable the Council, at its budget meeting on 9 February 2022, to approve the capital and investment strategy for 2022-23 to 2026-27, and to approve the funding required for the new capital schemes proposed