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Agenda Item No. 7(a)

 

 

THE VALE OF GLAMORGAN COUNCIL

 

COUNCIL MEETING:  5th DECEMBER, 2012.

 

REFERENCE FROM CABINET: 19th NOVEMBER, 2012.

 

C1910          INITIAL CAPITAL PROGRAMME PROPOSALS 2013/14 (L) (SCRUTINY - CORPORATE RESOURCES) -

 

Approval for the revised capital programme for 2012/13 and the initial capital proposals for 2013/14 was sought so that they could be submitted to Scrutiny Committee’s for consultation.

 

The following information was provided with regard to the 2013/14 Capital Programme.

 

Director of Housing and Visible Services:

  • Sub-standard bridges - an allocation of £250K was included in the 2012/13 Capital Programme, along with further allocations each year thereafter, currently to 2016/17, to cover safety issues with the Authority's various sub-standard bridges. Officers had advised that there was no call on this year's allocation but that it would be needed as part of the Council's 86% contribution to Network Rail's proposed safety works to Ewenny bridge, anticipated during 2013/14, which could reach £1M. As there was only £500K in the 2013/14 budget currently, the slippage of this year's £250K into 2013/14 would bring the budget to £750K so a further £250K was required from the 2014/15 budget. It was requested that Cabinet and Council approve the re-profiling of this budget to reflect the need for £1M for Ewenny Bridge in 2013/14.
  • B4265 Toucan Crossing - earlier this year, the Authority received the sum of £100,000 from the Ministry of Defence (MoD) for the construction of a new crossing over the B4265 to assist pedestrians and cyclists travelling between Boverton and West Gate, St Athan. The works were required under the terms of condition 18 of planning permission2002/01244/CROWN for the new DARA integrated maintenance facility. The works were now complete but, in addition to the funding received from the MoD, a further £40K was required to complete the works. It was proposed that this be funded from the existing allocation for Highway Safety Schemes. As such, it was requested that Cabinet approve the inclusion of a £140K budget for the toucan crossing into the current capital programme, funded from £100K (as a result of the payment received by MoD to meet their obligations under the terms of the planning permission) and a £40K virement from the Highway Safety Schemes capital budget.
  • An application for residential development at Andrew House, Llantwit Major was granted planning permission subject to a s106 agreement which required payment of £10,792 to improve sustainable transport facilities serving the development. It was proposed to use this contribution to establish a traffic calming scheme (speed cushions) on Durell Street to slow traffic and increase road safety for pedestrians and cyclists on a key route into the town centre. As such, it was requested that the sum be included in the current capital programme.

Director of Development Services

  • Pont y Werin Cycleway - WG had recently awarded an increase in their existing Regional Transport Consortia Grant allocation of £25K in order to fund the completion of the Dingle Road element of the scheme which was already receiving grant funding for 2012/13. As detailed design was completed a more accurate forecast cost was identified and WG informed. It was requested that the existing Pont y Werin Improvement budget be increased to reflect this additional funding.
  • A48 Bus Stop Improvements – Welsh Government (WG) had offered an additional grant of £25K to augment the current allocation of £25K on bus stop improvements along the A48 which had already been spent in full.  It was requested that the existing budget be increased to reflect this additional funding.
  • Railway Walk, Penarth - WG had also offered the Authority the sum of £15K pre-delivery funding to complete the detailed design stage of this cycleway scheme. It was requested that the existing budget be increased to reflect this additional funding.
  • Highways Making Better Use Study: Barry Docks Roundabout A4050 / A4231 - WG had offered a grant of £10K towards a study into possibilities of improving the roundabout at the junction of Port Road and the Barry Docks Link Road. Officers within our Highways Division would be preparing the study. Cabinet were requested to include a budget of £10,000 in the current capital programme.
  • Greenlinks Minibus - under delegated authority, the Managing Director had approved the inclusion of a £42K budget in this year's capital programme to fund the purchase of a second minibus for the Authority's community transport initiative. The funding for the vehicle would come from an £18K South East Wales Transport Alliance (SEWTA) grant, a £16K allocation from the Authority's Local Transport Services Grant form the Welsh Government as well as a contribution from revenue budgets of £8K. This budget was included in Appendix A.
  • St Paul’s Church - Cabinet on February 29th 2012, (minute no. C1646), approved the inclusion of a £250K budget for remedial works at St Pauls Church, Penarth, in order to secure the building to allow occupation of the former St. Paul's Church in Penarth by Penarth Gymnastics Club and Penarth Boxing Club. The building had been closed since early 2011 when its condition was deemed dangerous. Since the budget approval however, it had become evident that £250K might not cover all works required to the building, increasing the budgetary requirement for the project. Funding for the works was to be taken from the s106 monies received for the Penarth Heights development. The scheme had been put on hold, pending further consultation with local residents and it was now highly unlikely that any expenditure could be achieved this year. As such, it was requested that the £250K budget be slipped forward into 2013/14 while the situation was being reviewed.  Members would be informed of the outcome of the consultation exercise.
  • Disabled Facility Grants - expenditure had been behind profile all year on this grants budget. Though numbers of grants in the system had not fallen noticeably, the average cost of each grant had reduced from previous years and some high value cancellations had been received. These factors combined to reduce the anticipated final spend on grants by some £200K and, as such, it was requested that the budget be reduced to £1M in order to reflect the maximum expenditure that could be achieved on this budget.
  • Coronation Street Green Space Improvements - the Authority had recently accepted funding of up to £31,400 for improvements to the open space at Coronation Street, Barry. The funding was awarded from the Welsh Government's 'Tranquil, Greener and Cleaner Places Grant' and works had to be completed and claimed in full by the end of this financial year or funding would be lost. The works would be project managed by the Council’s Landscape Section and include additional seating, repainting railings and re-surfacing paths, new tree planting and native perennial and wildflower planting as well as additional path illumination to address safety concerns and new bollards along the boundary of the upper section with Coronation Street to avoid unauthorised vehicular access.

Cabinet had previously agreed that further information would be provided where schemes had a value of over £500K and showed a variance of 20% or more between actual spend and the profile. The following schemes met this criteria:-

  • Penarth Pier Pavilion - the capital budget represented the Council's contribution to this Penarth Arts and Crafts (PACL) led scheme. PACL recently had to complete a further tender review to ensure their spending was within profile for their various grant funders and this meant they could not let the works contract until 21st September, 2012, a full month behind profile. The budget profile would be amended to reflect this delay but at this stage a full spend was still anticipated by year-end.  
  • Barry Island Footbridge - works were now on site on this replacement footbridge scheme and were proceeding well. There was an initial delay caused by the steel work sub-contractor but this had now been resolved and the profile would be amended to reflect this but it is anticipated that a full spend on this part-Department for Transport grant funded scheme would still be achieved well before the end of the financial year.
  • Dyffryn Gardens Refurbishment and National Trust Contribution - both of these budgets were originally planned as September expenditure, to coincide with the anticipated transfer to the National Trust. Delays in this process had been incurred due to finalising the transfer agreement. A full spend of both budgets was nevertheless expected as it was now planned that the transfer would take place in January 2013.
  • Leisure Centres Refurbishment - it was originally anticipated that refurbishment works would commence during August and a profiled spend of £661K was originally anticipated by the end of September., however, the Parkwood Partnership arrangement was not finalised until 1st August, several months behind the original profile. Though works had now commenced, the profile would be reviewed to reflect the August agreement date. At this stage a full spend was still anticipated by the end of March but Members would be informed should this no longer be possible.

The Welsh Government announced the provisional 2013/14 General Capital Funding, on 16th October 2012. The 2013/14 capital settlement represented a 10% cut in funding over the previous year's allocation.

 

Should the Westminster Government commence a further Spending Review in 2014/15, it was likely that further austerity measures could be introduced between 2015/16 and 2017/18 which could bring about further cuts which were significant in nature. As such, a 10% cut each year from 2015/16 to 2017/18 had also been assumed in Appendix B. As part of a Budget Review, covering the period 2013/14 to 2017/18, the Council would have to look to mitigate the deteriorating situation in so far as it was able by reappraising all schemes and looking to progress only those that were deemed to be a key corporate priority, whilst also seeking to gain assurance that such schemes were delivered on time and within budget.

 

Cabinet, on 13th February, 2008 approved that the Director of Resources, (formerly Finance, ICT and Property), in consultation with the Cabinet Member responsible for Finance, be given delegated authority to transfer supported borrowing between General Fund and the Housing Capital budgets as appropriate. The Authority requested a transfer of £280,000 for 2013/14 and this sum had also been assumed each year to 2017/18.

 

The Major Repairs Allowance (MRA), which was the grant that provided capital funding to the Housing Revenue Account (HRA), for 2013/14 had not yet been announced by the Welsh Government.  Accordingly, Cabinet would be advised once the announcement was made. An assumption had been made in that the grant would continue at the current allocation of £2.8 million in 2013/14. 

 

In addition to funding from the Welsh Government, the Council would finance part of the capital programme from its own resources, e.g. capital receipts and reserves.  

 

Appendix B to the report outlined the proposed 2013/14 Capital Programme. The table below detailed the General Capital Funding and internal resources required to fund the proposed schemes.

 

 

 

Analysis of Net Funding Required for the Indicative 2013/14 Capital Programme

GENERAL FUND

£’000

£’000

Welsh Government Resources 

 

 

Supported Borrowing

3,180

 

General Capital Grant

2,106

 

 

 

5,286

Council Resources

 

 

Capital Receipts

5,120

 

Reserves/Leasing

3,417

 

 

 

8,522

Net Capital Resources

 

13,823

 

 

 

HOUSING REVENUE ACCOUNT

£’000

£’000

Housing Reserves   

13,402

 

Housing Capital Receipts

392

 

Supported Borrowing

280

 

 

 

 

Net Capital Resources

 

14,074

 

The indicative 2013/14 Capital Programme shown in Appendix B included allocations already approved by Council.

 

With regard to Capital Bids for 2013 / 14 an extremely high number of bids were received. As bids were evaluated by the Corporate Asset Management Group (CAMG), it was necessary to reduce the numbers of bids actually discussed by the Group in order to allow meaningful discussion for each bid. Departments were requested to rank their own bids in order of importance before submission and a maximum of the highest 20 bids from each Department were forwarded to the CAMG for evaluation.

 

The Budget Working Group had prioritised bids based upon the recommendations of the CAMG. The method of prioritisation used was as follows;

 

A

Health and Safety Legislation

B

Other Legislation / Statutory requirement

Ci

Economic Sense

Cii

Corporate Plan

Ciii

Sufficiency

D

Condition / Suitability

 

E

Welsh Government objectives

F

Low Priority

 

The evaluation of the bids by the CAMG resulted in a high number of priority A and B bids, Consequently, the bids would be further reviewed by the Budget Working Group in terms of their corporate priority and the risk they posed to the Council if they were not pursued.

 

Included in Appendix B was the sum of £350K for the second phase of the phase 2 expansion of Ysgol Dewi Sant, the Llantwit Major Welsh Medium School development.  This was subject to a grant bid to the Welsh Government and a Business Justification Case had recently been submitted to WG to support a 50% grant bid for this £700K scheme.

 

Appendix C to the report listed the capital bids received that were unsuccessful, or not discussed by the CAMG. These had not been put forward for inclusion in the 2013/14 programme.

 

The next stage was for the estimates to be submitted to the Councils Scrutiny Committees for consultation. The Scrutiny Committee (Corporate Resources) was the lead Scrutiny Committee and would consider both the Initial Budget Proposals and the comments that other Scrutiny Committees had made. The responses of Scrutiny Committee must be made no later than the 18th December, 2012.

 

It was agreed that subject to the following recommendations, the decision on St Pauls Church to reduce the budget to nil and carry forward £250k into 2013/14 be deferred pending a further report to the next Cabinet meeting. This was due to on going discussions in regard to health and safety issues and the possibility of spending money on this building to avoid its further deterioration.

 

Part of the report was required to be referred to Council for approval as it followed the procedure laid down in the Constitution for the making of the budget.

 

RESOLVED –

 

(1)               …………….

 

(2)               That the Council be recommended to make the following changes to the Capital Programme:

  • Sub-standard bridges - reduce the 2012/13 budget to nil and carry forward £250K into 2013/14 and bring £250K from the 2014/15 budget into 2013/14. This will require Council approval.

(3)       …………….

 

Reasons for decisions.

 

(1)               …………….

 

(2)               To amend the 2012/13 capital programme.

 

(3)               …………….

 

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