Minutes:
Question
The Capital Monitoring report shows reprofiling to date of £244m. What financial effect will this reprofiling have on the revenue costs required to manage these projects next year, in addition to those already planned for 2022/23?
Over the past two years, the Council has seen some unprecedented levels of uncertainty due to Covid-19. This has had an impact in some areas on the capital programme including the ability to source resources, materials and labour for some of the projects however we are still on track to invest £154m this year in the community as highlighted in the Capital Monitoring report. Alongside this, the Council have paused some programmes which will be considered in the future if viable business cases support these going ahead. You have just heard of one which is basically we are looking at solar farms for instance.
Any impact on revenue costs will be minimised and where required we will look to carry forward revenue budgets associated with these projects into future years. The Council continually monitors the impact of the Council’s capital programme on borrowing costs and look to minimise these by borrowing when required as projects are delivered rather than ahead of need.
The reprofiling of the capital programme is therefore wholly financially responsible and will enable schemes to be more appropriately delivered and will reduce unnecessary costs in the short term by passporting decisions and implementation into future years. Both when service needs and the financial landscape will be more certain.
I would add that none of this reprofiling has been at the expense of delivering services.
Supplementary Question
So, the approved Capital Budget for the year 2021/22 is £204m. As I have mentioned the carry forward to futures years is £244m, which is 120% of the programme for this year. I appreciate that some of this year’s projects have been delivered but that must mean that some projects are more than a year behind. Can you agree that it would be better to plan for a more deliverable programme so that residents might have certainty about investments in their communities?
For example, I see that the Montague Park community facility has been delayed yet again and I would regard that as an investment in services. So, I would really like to know when it is going to be delivered?
Supplementary Answer
I cannot tell you when that one will be delivered but if you want, I can write to you about that and explain why that has been delayed.
We live in very uncertain times, and you would not expect this Council to commit until we know where we are going and what is happening. Constantly in the past people have actually said that we have overborrowed, well we are now in a position whereby we feel we are not overborrowing, and we never will overborrow and we will make sure that our capital programme fits what is required at the time. We could not do it any other way. I mean it is just financially prudent to do it that way and of course there are some changes going on with regards to the way that councils can borrow money and the way they invest money and that is out for consultation at the moment, and we do not know the outcome of that yet.