The Interim Chief Officer Finance, Performance and Change presented a report to comply with the requirement of the Chartered Institute of Public Finance and Accountancy’s (CIPFA) Prudential Code for Capital Finance in Local Authorities; provided an update on the capital outturn for 2020-21; provided an update of the capital position for 2021-22 as at 30 June 2021; sought agreement from Cabinet to present a report to Council for approval a revised capital programme for 2021-22 to 2030-31 and to note the projected Prudential and Other Indicators for 20221-22.
The Interim Chief Officer Finance, Performance and Change reported that Council on 26 February 2020, approved a capital programme, which had been further revised and approved by Council during the year. The most recent programme for 2020-21 of £35.440m approved by Council in February 2021 as part of the Medium Term Financial Strategy, of which £12.419m is met from the Council’s resources, including capital receipts, revenue contributions from earmarked reserves and borrowing, with the remaining £23.021m coming from external resources. She informed Cabinet of amendments to the capital programme, with new approvals of £3.060m as a result of a new grant schemes from the Welsh Government, which include £2.329m School Maintenance Grant, £0.149m for the East Hub at Brynteg Comprehensive, £0.174m Green Recovery grant and £0.148m Circular Economy grant and £0.318m funding brought back from 2021-22 to reflect updated spend profiles, bringing the revised budget to £38.818m.
The Interim Chief Officer Finance, Performance and Change reported on an update on the Council’s capital programme for 2021-22 since the budget was last approved by Council which incorporated any new schemes and grant approvals. The revised programme for 2021-22 currently totalled £87.347m, of which £53.067m is met from the Council’s resources,
including capital receipts, revenue contributions from earmarked reserves and borrowing, with the remaining £34.280m coming from external resources, including General Capital Grant. The Interim Chief Officer Finance, Performance and Change highlighted the position by each Directorate. She summarised the current funding assumptions for the capital programme for 2020-21 and that capital resources are managed to ensure that maximum financial benefit for the Council is achieved, which may include the realignment of funding to maximise government grants.
The Interim Chief Officer Finance, Performance and Change reported on a number of amendments made to the capital programme for 2020-21 as follows:
The Interim Chief Officer Finance, Performance and Change also reported on the monitoring of Prudential and other indicators for 2021-22 to 2023-24 together with some local indicators. The Capital Strategy is intended to give an overview of how capital expenditure, capital financing and treasury management activity contribute to the provision of services along with an overview of how associated risk is managed and the implications for future sustainability. A number of prudential indicators were included, and approved by Council. In line with the requirements of the Prudential Code, the Chief Finance Officer is required to establish procedures to monitor both performance against all forward-looking prudential indicators and the requirement specified. She detailed the actual indicators for 2020-21, the estimated indicators for 2021-22 set out in the Council’s Capital Strategy and the projected indicators for 201-22 based on the revised Capital Programme, which shows that the Council is operating in line with the approved limits.
The Interim Chief Officer Finance, Performance and Change reported that the Capital Strategy also requires the monitoring of non-treasury management investments and other long term liabilities. She stated that the Council does have an existing investment portfolio which is 100% based within the County Borough and primarily the office and industrial sectors. Income streams are spread between the single and multi-let office investments on Bridgend Science Park, the multi-let industrial estates and the freehold ground rent investments. The total value of Investment Properties was £5.035m at 31 March 2021. She informed Council that it has a number of Other Long Term Liabilities included within the Capital Strategy.
The Deputy Leader in commending the revised Capital Programme stated that it represented a spend of £190m across the County Borough over a period of 10 years to make it a good place to live, work and visit. The capital programme will also assist in meeting the Council’s decarbonisation objectives.
The Cabinet Member Communities commented on the importance of the active travel programme for traversing across the County Borough as not everyone has access to their own transport.
The Leader referred to the Enable Grant and asked how it would impact positively on vulnerable people. The Interim Chief Officer Finance, Performance and Change informed Cabinet that the Enable Grant will allow for small scale adaptations to take place to enable people to stay in their own homes and live independently, following their discharge from hospital.
The Leader also requested clarification on the spend on the Resilient Roads Fund & Ultra Low Emissions programme. The Corporate Director Communities informed Cabinet that approximately £0.5m will be used to target roads which are vulnerable to flooding to make them more robust to the impact of climate change.
The Leader further requested clarification on the funding of £2.424m School Capital Maintenance grant. The Corporate Director Communities stated that the aim of the funding is to ensure best value is achieved by tendering for the same scheme across schools to maximise the use of money and to ensure the school estate is fit for purpose.
RESOLVED: That Cabinet:
· noted the capital outturn for 2020-21 (Appendix A to the report)
· noted the Council’s Capital Programme 2021-22 Quarter 1 update to 30 June 2021 (Appendix B)
· agreed that the revised Capital Programme (Appendix C) be submitted to Council for approval
· noted the projected Prudential and Other Indicators for 2021-22 (Appendix D).