Appendix 2 - Capital Programme Update

 

1          Background

1.1       As part of the Reconciling Policy Performance and Resources (RPPR) process the Capital Strategy and programme are reviewed annually to ensure that they support the Council’s responsibilities and departmental service strategies. To manage investment to a sustainable level, the Capital Strategy focuses on the delivery of targeted basic need to support the council in the delivery of services as efficiently as possible, rather than rationing through prioritisation. This is in recognition that there are conflicting priorities but that a level of investment is needed across the council in order to deliver the council’s services and react to changes in technology, economy and the environment. Basic need for the purpose of strategic capital planning is provided below: -

·         Place: ensuring we can deliver services by planning for future need.

·         Asset Condition: maintaining our assets to an agreed level.

·         ICT Strategy: ensure that our Information and Communications Technology (ICT) is fit for purpose for delivering modern council services in a digital era and protecting data.

·         Climate Change: tackling climate change has become part of ESCC core business, investment is required for the achievement of carbon neutrality.

1.2       At Full Council in February 2022 the target led basic need capital strategy of 20 years, supported by a 10-year planned capital programme was approved. The approved programme was further updated at State of the County in July 2022 to reflect the 2021/22 outturn, project and programme reprofiles and approved variations, revising the gross programme to £676.0m to 2031/32. For planning purposes, the first 3 years of the programme, to 2024/25 are considered approved. Whilst the remaining years are indicative to represent the longer term planning for capital investment.

2          Variations to the Current Approved Programme

2.1    The programme has been updated for approved variations since the State of the County in July 2022. These are summarised in the table below.

Table 1 - Capital Programme (gross) movements (£m)

Approved MTFP Programme

MTFP   +1 Year

2026/27 to 2031/32

Total

2022/23

2023/24

2024/25

2025/26

Approved programme at State of the County 2022

95.588

82.720

83.761

76.649

337.329

676.047

Approved Variations (see 2.2)

(1.360)

2.307

3.990

0.231

-

5.168

Total Revised Programme

94.228

85.027

87.751

76.880

337.329

681.215

2.2     The approved variations to the programme relate to schemes totalling gross £5.168m (the profiling of which is currently under review) as follows:

·         Schools Delegated Capital Programme: An increase to the programme of £0.656m to reflect latest schools plans for capital investment in year to be funded from specific grant and schools contributions.

·         Learning Disability Supporting Living Scheme: A report to Adult Social Care Lead Member in March 2022 proposed capital investment of £6.421m to redevelop services for adults with learning disabilities at a number of properties, which will be funded from within existing Adult Social Care revenue budget and ringfenced grant funding, which has been held in anticipation of eligible social care transformational investment.

·         Getting Building Fund - Riding Sunbeams (Local Enterprise Partnership (LEP) Funded Project): A reduction of £2.477m where the project has not met some pre-conditions originally set and funding has therefore been removed and withdrawn from the capital programme following approval of the South East LEP (SELEP) Accountability Board.  

·         Disability Children's Homes (Sorrel Drive): As approved as part of the Q1 monitoring to Cabinet, design work has identified that an increased scope would deliver additional benefits including future cost avoidance relating to alternative provision. The revised cost has increased by £0.568m, of which £0.261m has been identified within Children’s Services revenue budgets, and £0.307m from increased capital programme borrowing. This addition to the capital programme is recommended in accordance with the Capital Strategy via business case, demonstrating value for money when considering the cost of alternative provision and its potential ongoing impact on revenue budgets.

3          Conclusion and Next Steps

3.1      Work will be progressed as part of the RPPR process to extend the programme by a further year to maintain a 10-year planning horizon together with a review of programme profiles across years. The annual review of the Capital Strategy will also be completed to ensure continued links into, and in support of, the Council’s other strategies.

 

3.2       A £7.5m risk provision was approved in February 2022 to mitigate against capital programme risks, representing circa 2% of the programme over the MTFP period. This risk provision is a permission to borrow for emerging risks and is managed through ensuring Treasury Management capacity rather than representing funds that are within the Council’s accounts. There are several risks and uncertainties regarding the programme to 2025/26 and beyond which have necessitated holding a risk provision. Including increased uncertainties that exist within the construction industry in terms of supply chain issues and high-cost inflation which are likely to impact the delivery of schemes within the current budget. The capital programme includes an element of ‘normal’ inflation for ongoing, target-based, core programmes (as opposed to programmes that have cash limited envelopes) such as Highways at 3% annually, with any increases above this level that cannot be managed within the agreed budget, to be supported by the risk provision.

3.3       Any unmanageable risks which have a financial impact are required to be reported to Capital and Strategic Asset Board to be considered as part of the broader RPPR process. This will be done on a case by case basis, and in the context of the wider programme, and the fiscal and economic national position. As part of the RPPR process the adequacy of the risk provision will also be assessed.

3.4       Ahead of further announcements there are no updates to the overall funding position currently. As part of the RPPR process capital funding will be reviewed, and this will include estimates of developer contributions (Section 106 and Community Infrastructure Levy), capital receipts and any updates to formula grants following government announcements.

3.5      Annex 1 provides the capital programme updated for variations noted at section 2.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Annex A – Detailed Capital Programme

 

Capital Programme (gross) (£m)

MTFP Programme

MTFP   +1 Year

2026/27 to 2031/32

Total

2022/23

2023/24

2024/25

2025/26

Adult Social Care:

 

 

 

 

 

 

House Adaptations

0.050

0.050

0.050

-

-

0.150

Learning Disability Support Living Scheme

0.200

2.000

3.990

0.231

-

6.421

Greenacres

0.144

-

-

-

-

0.144

Adult Social Care Total

0.394

2.050

4.040

0.231

-

6.715

Business Services:

 

 

 

 

 

 

Salix Contract

0.350

0.350

0.350

0.350

2.100

3.500

Lansdowne Secure Unit – Phase 2

0.075

-

-

-

-

0.075

Special Educational Needs

1.600

1.589

-

-

-

3.189

Special Educational Needs – Grove Park / Beacon

2.579

5.000

6.000

5.000

0.600

19.179

Special Provision in Secondary Schools

0.120

-

-

-

-

0.120

Disability Children’s Homes

0.479

0.307

-

-

-

0.786

Westfield Land

0.721

-

-

-

-

0.721

Schools Basic Need

5.337

5.517

15.853

23.747

47.990

98.444

Capital Building Improvements (Schools)

5.179

4.182

4.182

4.182

25.092

42.817

Capital Building Improvements (Corporate)

3.439

4.520

4.520

4.520

27.120

44.119

IT & Digital Strategy Implementation

5.786

13.057

4.928

3.900

44.725

72.396

IT & Digital Strategy Implementation - MBOS

6.451

-

-

-

-

6.451

IT & Digital Strategy Implementation - Utilising Automation

0.024

-

-

-

-

0.024

Business Services Total

32.140

34.522

35.833

41.699

147.627

291.821

Children’s Services

 

 

 

 

 

 

House Adaptations

0.050

0.050

0.050

-

-

0.150

School Delegated Capital

1.385

1.150

1.150

-

-

3.685

Conquest Centre Redevelopment

0.015

-

-

-

-

0.015

Children’s Services Total

1.450

1.200

1.200

-

-

3.850

Communities, Economy & Transport:

 

 

 

 

 

 

Broadband

0.911

2.757

2.757

-

-

6.425

Salix Solar Panels

0.077

-

-

-

-

0.077

Climate Emergency Works

2.090

1.516

5.922

-

-

9.528

Flood & Coastal Resilience Innovation Programme

0.250

-

-

-

-

0.250

Bexhill and Hastings Link Road

0.318

-

-

-

-

0.318

Bexhill and Hastings Link Road – Complementary Measures

0.167

0.060

-

-

-

0.227

Economic Intervention Fund – Grants

0.282

0.435

0.300

0.300

0.754

2.071

Economic Intervention Fund – Loans

0.497

0.500

0.500

0.473

-

1.970

Stalled Sites

0.055

0.120

0.104

-

-

0.279

Upgrading Empty Commercial Properties

-

0.007

-

-

-

0.007

Community Match Fund

0.100

0.380

-

-

-

0.480

Community Road Safety Interventions

0.250

0.250

0.250

-

-

0.750

Newhaven Port Access Road

0.189

0.020

0.776

-

-

0.985

Real Time Passenger Information

0.074

0.078

0.060

0.061

 

0.273

Queensway Depot Development

0.175

0.466

-

-

-

0.641

Hailsham HWRS

0.164

-

-

-

-

0.164

The Keep

0.132

0.096

0.026

-

0.823

1.077

Other Integrated Transport Schemes

3.144

5.440

5.209

4.024

17.843

35.660

Integrated Transport Schemes – A22 Corridor

0.200

-

-

-

-

0.200

Exceat Bridge Replacement

2.176

3.733

2.509

-

-

8.418

Emergency Active Travel Fund – Tranche 2

0.756

-

-

-

-

0.756

Libraries Basic Need

0.497

0.789

0.449

0.449

1.796

3.980

Peacehaven Library Refurbishment and Conversion

0.028

-

-

-

-

0.028

Libraries Targeted Support

0.211

-

-

-

-

0.211

Highways Structural Maintenance

21.186

21.147

21.688

22.246

146.158

232.425

Bridge Assessment Strengthening

3.022

3.708

1.775

3.025

12.494

24.024

Street Lighting and Traffic Signals

3.723

3.792

3.839

3.888

6.702

21.944

Street Lighting and Traffic Signals – Salix Scheme

0.650

-

-

-

-

0.650

Visually Better Roads

5.609

-

-

-

-

5.609

Rights of Way Surface Repairs and Bridges

0.565

0.565

0.514

0.484

3.132

5.260

Communities, Economy & Transport (LEP Funded Schemes):

 

 

 

 

 

 

Eastbourne Town Centre Phase 2

3.241

-

-

-

-

3.241

Eastbourne/South Wealden Walking & Cycling Package

2.351

-

-

-

-

2.351

Hailsham/Polegate/Eastbourne Movement & Access Corridor

0.550

0.409

-

-

-

0.959

Hastings & Bexhill Movement & Access Package

4.089

0.987

-

-

-

5.076

Skills for Rural Businesses Post-Brexit

0.915

-

-

-

-

0.915

Getting Building Fund – UTC Maritime and Sustainable Technology Hub

1.300

-

-

-

-

1.300

Getting Building Fund – Food Street

0.100

-

-

-

-

0.100

Getting Building Fund – Seven Sisters

0.200

-

-

-

-

0.200

Communities, Economy & Transport Total

60.244

47.255

46.678

34.950

189.702

378.829

Total Programme

94.228

85.027

87.751

76.880

337.329

681.215