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Waverley Borough Council Committee System - Committee Document

Meeting of the Executive held on 07/02/2006
Financial Strategy 2006/07 - 2008/09 : Draft Captial Programme 2006/07


Summary & Purpose
The purpose of this report is to agree the final recommendation to Council regarding the General Fund Capital Programme for 2006/2007. The report contains any observations from the Overview and Scrutiny Committees.
APPENDIX B.2
Waverley Borough Council

EXECUTIVE – 7TH february 2006

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Title:
FINANCIAL STRATEGY 2006/2007- 2008/2009
DRAFT CAPITAL PROGRAMME 2006/2007

[Wards Affected: All]
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Summary and purpose:

The purpose of this report is to agree the final recommendation to Council regarding the General Fund Capital Programme for 2006/2007. The report contains any observations from the Overview and Scrutiny Committees.

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Environmental implications:

The draft Capital Programme contains proposals that will benefit the environment.

Social / community implications:

The draft Capital Programme contains proposals that will benefit the community.

E-Government implications:

The draft Capital Programme contains proposals for implementing E-Government.

Resource and legal implications:

There are no specific legal implications as a result of the recommendation of this report, although the Capital Programme contains budgets that will enable the Council to fulfil its legal obligations. Resource implications are contained throughout the report.

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Introduction

1. Proposals for the 2006/2007 – 2008/2009 Capital Programme were presented to the Executive on 6th December 2005. These proposals totalled some £4.7m in 2006/2007 compared with the guideline of £3.1m contained within the updated Financial Strategy. Therefore, the Executive requested the Officers to advise its meeting on 10th January which priority schemes should be programmed for 2006/2007 and to advise further on the resources that are likely to be available.

Draft 2006/2007 Capital Programme

2. The Chief Officer Group has reconsidered the capital bids and reduced, re-phased or removed amounts scheduled for 2006/2007. The proposed changes were considered by the Executive and Overview and Scrutiny Committees during January. In response to the Executive comments, officers have reviewed the IEG schemes and have reduced them from £460,000 to £383,000. The revised draft Capital Programme is attached at Annexe 1.

Summary of Changes

3. The following table summarises all changes proposed since the draft Programme was submitted to the Executive on 6th December.

SUMMARY OF REDUCTIONS TO 2006/2007 PROGRAMME
£
Private Sector Renewals Grants – reduced
25,000
Electronic Government for Customer Service – restricted to £383,000
82,000
Council Chamber & Committee Room 1 – deleted
40,000
Central Offices Air Conditioning – deleted
15,000
Planning Delivery Grant funded expenditure – reduced in line with grant
40,000
Contaminated Land – reduced
10,000
Licensing of Houses in Multiple Occupation – Met by revenue income
25,000
Pavilions Repairs Programme - reduced
20,000
Recreational Facilities for Young People- reduced
30,000
Cemeteries Headstone Risk Assessment – part re-phased to 2007/8
20,000
Total Reductions since 6th December Executive
£307,000
Farnham Sports Centre – transferred from 2005/6 to 2006/7
(£100,000)
Observations from Overview and Scrutiny Committees
Corporate

4. The Committee considered a report putting forward revised proposals for the draft 2006/2007 Capital Programme in respect of General Fund Services. Members received clarification from officers about a number of projects within the remit of their Committee, in particular the budget proposed for maintenance/improvements to the Central Offices and a detailed explanation was given as to the numerous tasks that needed to be funded from this allocation.

Community

5. The Committee considered the draft Capital programme for the services within its remit and agreed that there should not be any savings for services within the remit of the Community Overview and Scrutiny Committee

Environment and Leisure

6. Members heard that because of suggested reductions by the Chief Officers Group, and other financing proposals, the shortfall had closed substantially. Members discussed options for funding the remaining shortfall and agreed that, although it had not been used before, prudential borrowing may be a possibility on a one-off basis.

Resources Available 2006/2007

7. The Chief Officer Group have examined the resources that could reasonably be made available to finance the capital programme in 2006/2007 beyond the 3.1 million already agreed within the updated financial strategy.

8. The draft Programme includes a total of £817,000 towards Godalming Leisure Centre Improvements, of which £654,000 is scheduled for 2006/2007. Enabling this scheme to be undertaken in full is the highest leisure priority for the people of Godalming, who will receive immediate benefit from the improved facilities. In 2004/2005 the Council set aside £500,000 from capital receipts to establish a fund to help finance a future new Godalming Leisure Centre. By 2006/2007 will have increased to £550,000 through the generation of interest. The Chief Officer Group consider that it will be appropriate to respond to the current capital requirement by using the Godalming Leisure Fund to finance the substantial amount of works proposed to be undertaken at Godalming Leisure Centre. The amount in the Fund represents approximately some 5% of that required for a new leisure centre; and this will not in itself delay the construction of a new centre. Indeed, it is considered essential to maintain the existing centre as a vibrant facility in order to establish a strong customer base for the eventual new centre.

9. The last Executive meeting and the Environment and Leisure Overview and Scrutiny Committee suggested that prudential borrowing could be undertaken for the balance of the capital expenditure requirement at Godalming Leisure Centre. The current capital financing costs of £250,000 repaid over a 10-year period amount to some £30,000, which is within the additional income expected as a result of undertaking the improvements. The Revenue Estimates have therefore been adjusted to allow for the option of prudential borrowing. Final decisions regarding prudential borrowing will be made by the Director of Finance at the appropriate time. 10. In 2001 Waverley committed to provide £750,000 to the Farnham Maltings as its share of partnership funding. The draft 2006/2007 Programme contains £217,000 to cover a further phase of this work. As in previous years, it is suggested that this amount be provided from the Revenue Reserve Fund as an addition to the normal level of funding towards the capital programme. A further £225,800, representing the balance of the £750,000 is currently scheduled for 2008/2009 and similarly this amount is now shown as provided from the Revenue Reserve Fund

Revenue Reserve Fund

11. Detailed projections for the Revenue Reserve Fund taking account of the proposals described in the Revenue Estimates report are shown at Annexe 2.

12. The projections also take account of the transfer of £852,000 from the Insurance Funds to the Revenue Reserve Fund as recommended at Appendix G of this Agenda.

13. The use of the Fund to finance the Capital Programme accords with the requirements shown by the Capital Financing Proposals at Annexe3

Conclusion

14. The financing proposals at Annexe 3 show that the Programme as now submitted for approval can now be met from the increased resources available for the three years 2006/2007 to 2008/2009.

15. The Programme will be subject to final approval by Council on 21st February.

Recommendation

It is recommended that the Executive recommend that Council:

1. approves the 2006/07 General Fund Capital Programme as shown at Annexe 1;
2. agrees the financing proposals in accordance at Annexe 3; and
3. amends the Financial Strategy to reflect the above decisions.

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Background Papers (DoF)

Waverley’s Implementing Electronic Government Statement.

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CONTACT OFFICER:

Name: Brian Long Telephone: 01483 523253

E-mail:blong@waverley.gov.uk

Comms/exec/2005-06/288