Agenda item

The Leader presented the report that provides an update to Cabinet on the capital monitoring position as at the end of September and the changes to the programme since the last report.  The report also provides an update on the available capital resources and capital receipts.

The Leader reported that in terms of updates to the programme since the last report to Cabinet in August, Newport has an extensive capital programme investing in a variety of important schemes across Newport from investment in schools, regeneration activities, heritage and energy efficiency schemes.  Following additions of over £2.4m the overall capital programme is now £206.7m.

Additions to the programme include: further investment in 21^st Century Band B schools, including utilisation of secured Section 106 monies and a number of secured Welsh Government grants, including investment into electric powered refuse collection vehicles and support for businesses through the Covid-19 pandemic.

The monitoring position for 2020/21 shows further slippage into future years of £3.8m, this reflects the profile of the delivery of schemes for the remainder of the year.  There is also a small underspend on completed projects of £470,000 mainly within City Services.

The available capital resources (headroom) shows a similar position to that previously reported at c£21m.  However, the Leader confirmed that as the Council approaches the back end of this five year programme and looks to the Medium Term Financial Plan, there is a need to reflect the revenue impact of this headroom over the MTFP and look at the parameters in which the next capital programme will be delivered.  This will form part of the capital strategy, which is reviewed and updated annually and will look at the long-term capital strategy for the Council.  This will be discussed by Cabinet, alongside the Medium Term Financial Plan, in February.

With regard to capital receipts, the report requested Cabinet to approve the use of £2.03 million of capital receipts in order to pay off loan premiums which were payable when loans were repaid early in 2015/16.  Whilst this gave a net saving at the time, there was a premium payable of c£500,000 per annum.  There is just over £2 million left to be paid, and capital receipts can be utilised to pay this off and enable a saving to be put into the MTFP in 2021/22 of £507,000, leaving a balance of £3.1m of uncommitted receipts, including £1.1m relating to Welsh Government Joint Venture receipts.

Cabinet was asked to:

-          note the monitoring position and approve the additions and slippage included in the report;

-          note the available capital resources, reflecting that this will be updated as part of the upcoming capital strategy; and,

-          approve the use of capital receipts and note the balance of remaining capital receipts

The Leader invited Cabinet colleagues to comment:

Councillor Giles commended the excellent work contained in the Band B Programme for Schools and the continuing work associated with this.  She congratulated the education service and schools for their continued hard work.

Councillor Cockeram referred to page 48 of the agenda - Children and Young People Services – and queried the reference to the project being funded via an Integrated Children’s fund allocation from Aneurin Bevan University Health Board.He believed this information was incorrect and the project was being funded by the RPB Board.  The Leader asked the Chief Executive to pick this up outside the meeting and to clarify the position with regard to the source of funding.

Councillor Harvey was pleased to confirm the stage 2 applications had been submitted for the work to the Transporter Bridge.  She also passed on thanks from the small businesses along Chepstow Road for the help and assistance they have received from the Council during the Covid-19 pandemic.

Councillor Jeavons referred to active travel and applauded the 20 km of roads that have been made suitable for this purpose; over 27,500 counts of people had been recorded in May using the cycle-ways.  Leader concurred with his comments and was pleased to be witness to how well the routes are maintained by the Council.

Cabinet was asked to:

1.    approve the additions and amendments to the Capital Programme requested in the report (Appendix A);

2.    approve slippage of £3,808k into 2021/22;

3.    note the available remaining capital resources (headroom) until 2022/23;

4.    note the capital expenditure forecast position as at September 2020;

5.    note the balance of and approve the allocation of in-year capital receipts including the use of £2.030m receipts for to reduction of payments for loan premiums.

Decision:

Cabinet voted and unanimously approved:

i.              the changes to the Capital Programme and noted the monitoring position as set out in the report, including the use of capital receipts, and,

ii.             agreed to prioritise capital expenditure to maintain spend within the current affordability envelope, recognising that the revenue pressures from future borrowing are part of the overall MTFP budget gap.