Agenda Item No
The Vale of Glamorgan Council
Scrutiny Committee (Corporate Resources): 16th July 2013
Report of the Managing Director
Capital Monitoring Report for the period 1st April to 31st May 2013
Purpose of the Report
1. To advise Scrutiny of the progress on the 2013/14 Capital Programme for the period 1st April 2013 to 31st May 2013 .
That Members note that Scrutiny Committees have been requested to forward recommendations 1 to 4 to Cabinet (and recommendation 3 to Council). That this Committee endorse recommendation 5 and forward such to Cabinet.
1. Schools IT Loans - increase the budget to £200K (funded initially from the IT Fund, repayable by the schools).
2. Cashless Catering and Management Information System - reduce the budget to £140K (carry forward £160K into 2014/15)
3. Ewenny Road Bridge - reduce the budget to £100K (carry forward £900K to 2014/15). This should also be referred to Council.
4. S106 Cogan Hill/Plassey Street junction phases 1 & 2 - reduce the budget to £30K (carry £227K forward into 2014/15)
5. Carbon Management Fund - increase the budget by £125K to £213K (funded from the Energy Management Fund)
Reasons for the Recommendations
1-5 To allow schemes to proceed in the current or future financial years.
2. Council on the 6th March 2013, minute number C942, approved the proposed capital programme for 2013/14.
Relevant Issues and Options
3. Appendix 1 details financial progress on the Capital Programme as at 31st May 2013.
4. Members should be aware that appendix 1 now includes approved slippage for unspent committed capital expenditure slipped from 2012/13 into 2013/14. This was approved by exercising the Managing Director's delegated emergency powers. Details of the slippage are included in the Closing Report reported to Cabinet on 29th July 2013.
5. For all schemes where it is evident that the full year's budget will not be spent during the year, the relevant officers are required to provide an explanation for the shortfall and this shall be taken to the earliest available Cabinet.
Learning and Skills
6. Schools IT Loans - an annual budget of £150K is drawn upon by various primary and secondary schools each year in order to purchase new IT equipment via initial use of the Council's IT Fund which is repaid over a fixed period, typically three years. The arrangement saves the Authority money by avoiding the relatively high interest rates charged on external lease purchase agreements and, in addition, the equipment can be retained by the schools at the end of the repayment term rather than being returned to the leasing company. It is therefore proposed that Cabinet approve the annual increase of £50K, to £200K p.a. on this budget, for the current and future years, in order to maximise use of this scheme.
7. Cashless Catering and Management Information System - an allocation of £300K is in place for 2013/14 for the introduction of a fully integrated cashless catering operation in all primary and secondary schools which, amongst other efficiencies, should free up administration time spent on collecting school dinner money. The rollout over all schools, however, is likely to take longer than one year to complete so the client has requested that their budget be split between 2013/14 and 2014/15. It is therefore requested that £140K remain in 2013/14 but that the sum of £160K be carried forward into 2014/15 to complete the roll out.
Visible Services and Housing
8. Ewenny Road Bridge - an allocation of £1M has been approved as this Council's contribution towards Ewenny Road bridge replacement works for 2013/14. This sum represents a 53% share of expected costs of works which will be procured and managed by Network Rail. We currently anticipate that the planned profile for the scheme runs from January 2014 through to July 2014, although we await final programme details from Network Rail. They are planning to draw down the Council's contribution once their own funding is exhausted and, as a consequence, it is now clear that the majority of the Council's £1M allocation will now not be required until 2014/15. It is proposed therefore to leave the sum of £100K in the current year's capital programme to cover a potential drawdown this year and slip the remaining £900K to 2014/15.
9. S106 Cogan Hill/Plassey Street junction phases 1 & 2 - works are required to improve the traffic flow into and out of Penarth from the Barons Court junction. Funding is available from s106 funds from the Penarth Heights development and must be fully spent by September 2030. Phasing at the Barons Court junction traffic signals has recently been undertaken and it is intended to monitor functioning of these changes to ensure effective operation of these signals before proceeding with design of the Penarth junctions. As a result, detailed design on this s106 funding is not likely to commence before January 2014 and it is proposed to reduce the current year budget to £30K and carry forward the balance of £227K into 2014/15 when proposed construction works can be progressed. If it is possible to bring this programme forward this will be done as a matter of priority.
10. Carbon Management Fund - this self-financing fund was established with the help of some £300K grant from Salix Finance in 2008/09 and is used to achieve reductions in energy costs at council premises. Over 50 projects have been completed to date, including loft and cavity wall insulation, draught exclusion and pipe insulation, Leisure Centre pool covers as well as LED lighting and lighting controls. Works costs are recharged to clients over a payback period that mirror savings achieved in energy costs, hence replenishing the fund. There is currently £213K available in this fund that is intended to be spent on further schemes this year so it is requested that Cabinet approve the increase in the Capital Programme from the current approval of £88K (including slippage of £13K) to £213K in order to proceed with further energy reduction schemes.
Variance between Actual Spend to date and Profiled Spend
11. Cabinet have previously agreed that further information would be provided where schemes have a value of over £500K and show a variance of 20% or more between actual spend and the profile. The following schemes meet this criteria:-
12. Housing Improvement Programme - expenditure is behind profile on central heating and boiler renewals due to a reduction in required installations, reflecting the fact that those worst cases have previously been completed. Conversely, the rewire programme is ahead of profile due to a higher than anticipated number of full rewires being required than had been anticipated. As the programme proceeds, further budget virements may be required to rationalise WHQS budgets with emerging needs.
13. Disabled Facility Grants - although the level of grant approvals are up, there seems to be a delay with contractors completing works on site and submitting claims. Officers within the Public Protection Grants Team are however chasing up payments to maximise spend and they are confident that the original profile is still achievable in the near future.
Resource Implications (Financial and Employment)
14. There are no direct financial implications of this report. Carbon Management Fund projects are specifically designed to reduce the Council's carbon emissions at its properties.
Sustainability and Climate Change Implications
15. There are no sustainability and climate change implications
Legal Implications (to Include Human Rights Implications)
16. There are no legal implications.
Crime and Disorder Implications
17. There are no crime and disorder implications.
Equal Opportunities Implications (to include Welsh Language issues)
18. There are no equal opportunity implications.
19. Effective monitoring assists in the provision of accurate and timely information to officers and Members and in particular allows services to better manage their resources.
Policy Framework and Budget
20. This report is a matter for Executive decision by the Cabinet.
Consultation (including Ward Member Consultation)
21. Each Scrutiny Committee will receive a monitoring report on their respective areas. This report does not require Ward Member consultation.
Relevant Scrutiny Committee
Laura Davis, Senior Accountant, Tel. no. 01446 709249
The Directors of Resources, Social Services, Development Services, Visible Services and Housing, and the Chief Learning and Skills Officer.
Director of Resources