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Capital Budgets 2014/15-2016/17

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Capital Budgets 2014/15-2016/17 Manchester City Council Item 12 Executive 12 February 2014 Manchester City Council Report for Resolution Report to: Executive – 12 February 2014 Finance Scrutiny Committee – 24 February 2014 Subject: Capital Programme (Budget 2014/15 – 2016/17) Report of: The City Treasurer Summary The purpose of the report is to present the 2014/15 capital programme and forward commitments. Included in the report is an update on the latest estimates of expenditure in 2013/14 and explanation of the major variations since the Capital Monitoring report to October Executive. Recommendations The Executive is requested to: 1. Note that this report reflects the latest position as at January 2014. Capital expenditure to date is £117.5m and the latest full year forecast is £238.72m. 2. Agree that the capital budget be amended to reflect movement in the programme, attributable to approved budget increases, updates to spending profiles and in year budget transfers between capital schemes to maximise use of funding resources available to the city council. 3. Note that capital resources will be maximised and managed to ensure the capital programme 2013/14 remains fully funded and that no resources are lost. 4. Recommend the City Council to approve the capital programme as presented in Appendix 1 (for £289.734m in 2014/15 and £140.437m in 2015/16 and £76.374m in 2016/17) which will require prudential borrowing of £93.284m to fund non-HRA schemes over the three year period. Provision has been made in the revenue budget for the associated financing costs within the limits previously agreed. 5. To note that the capital programme will continue to be reviewed and any recommendations will be reported back to Executive. 6. Approve and recommend Council to delegate authority to: a) The Director of Growth and Neighbourhood Services in consultation with the Executive Member for Environment for the approval of the list of schemes to be undertaken under the Highways capital programme. b) The Director of Growth and Neighbourhood Services to implement these schemes in accordance with the Capital Gateway process and 149 Manchester City Council Item 12 Executive 12 February 2014 after consultation with the Executive Member for Environment on the final details and estimated costs. c) The City Treasurer in consultation with the Executive Member for Finance and Human Resources to add qualifying spend to save projects to the capital budget accordingly up to a maximum of £5,000,000 in 2014/15 and then £5,000,000 per year thereafter. d) The City Treasurer in consultation with the Executive Member for Finance and Human Resources is authorised to increase the capital budget by up to £500,000, subject to 100% external funding being available. e) The City Treasurer, in consultation with the Executive Member for Finance and Human Resources to accelerate spend when necessary within the programme subject to resource availability. f) The City Treasurer in consultation with Executive Member for Finance and Human Resources to agree and approve where appropriate the following: i. The programme of schemes for the delivery of the corporate asset management programme ii. Proposals relating to Corporate Compulsory Purchase Orders g) The City Treasurer in consultation with the Executive Member for Finance and Human Resources to make alterations to the schedules for the capital programme 2014/15 to 2016/17 prior to their submission to Council for approval, subject to no changes being made to the overall estimated total cost of each individual project. Wards Affected: All Community Strategy Spine Summary of the contribution to the strategy Performance of the economy The capital programme contributes to various areas of the region and sub region of the economy including investment in public and private sector housing, education and children’s social care, transport infrastructure, major regeneration activities, environmental, cultural and leisure services. Reaching full potential in The capital programme includes substantial education and employment investment in education and also provides opportunities for the construction industry to bid for schemes that could provide employment opportunities at least for the duration of contracts. 150 Manchester City Council Item 12 Executive 12 February 2014 Individual and collective self The capital programme includes investment in adult esteem – mutual respect and children’s social care, education, housing and the environment, cultural and leisure services, all of which contribute towards this community strategy. Neighbourhoods of Choice Investment in all areas of the capital programme contributes towards the community strategy, notably investment in sustainable and affordable housing, building schools for the future, transport, environmental and major regeneration programmes. Full details are in the body of the report, along with any implications for: • Equal Opportunities Policy • Risk Management • Legal Considerations Financial Consequences – Revenue The capital programme report as presented will require the following level of prudential borrowing – £93.284m (all non-HRA) over the three year period and provision is being made in the revenue budget for the associated financing costs. The revenue consequences of proposed Capital schemes are considered by the Gateway process and then developed within business plans to ensure provision within revenue budget. Financial Consequences – Capital The latest forecast spend for 2013/14 is £238.72m. The proposals contained in this report would create a capital programme of £289.734m in 2014/15, £140.437m in 2015/16 and £76.374m in 2016/17. Contact Officers: Name: Richard Paver Position: City Treasurer Telephone: 234 3564 E-mail: [email protected] Name: Carol Culley Position: Assistant Chief Executive (Finance and Performance) Telephone: 234 3406 E-mail: [email protected] Name: Ceri Taylor Position: Head of Finance – Corporate Capital, Projects and Taxation Telephone: 234 3458 E-mail: [email protected] 151 Manchester City Council Item 12 Executive 12 February 2014 Attachments Appendix 1: Detailed Three Year Capital Programme Background documents (available for public inspection): The following documents disclose important facts on which the report is based and have been relied upon in preparing the report. Copies of the background documents are available up to 4 years after the date of the meeting. If you would like a copy please contact one of the contact officers above. Report to the Executive 13 February 2013 – Capital Programme Budget 2013/14 to 2015/16. Report to Council 8 March 2013 Report to the Executive 25 June 2013 – Capital Programme Outturn 2012/13. Report to the Executive 24 July 2013 – Capital Programme Monitoring Report 2013/14. Report to the Executive 23 October 2013 – Capital Programme Monitoring Report 2013/14. 152 Manchester City Council Item 12 Executive 12 February 2014 Introduction 1. The purpose of the report is to present the capital strategy and capital programme for 2014/15 and future years and to confirm that there are adequate levels of resources available to finance the capital programme. Strategic Context 2. Manchester is an ambitious city with a strong track record of delivery through partnerships and effective strategic leadership, improving the quality of life for the residents and delivering a vision of making Manchester a world class city. The Combined Authority and Local Enterprise Partnership provide accountability, civic and business leadership and a platform for decisions on funding streams for growth to be brought together and devolved on a place basis. 3. The strategy adopted over the past three years of ensuring decisions are based on the priorities for the City needs to be continued. This requires a clear framework for making spending decisions and maximising the resources that remain. The Strategic Approach to 2015/16 and Beyond elsewhere on the agenda sets out the framework. This is drawn from the overall aims for Greater Manchester which are set out in the Greater Manchester Strategy (GMS) and the Community Strategy. This and the updated budget principles for: the Corporate Core; Leadership of Place; Targeted and Specialist Services; and Universal Services have informed the revenue and capital budget proposals which are being put forward. Given current economic pressures the ambition for the Council is to deliver a capital programme with the optimum combination of projects that represent the key priorities of the City Council and maximise the funding resources that are available. 4. Greater Manchester Strategy sets out the Vision for the future “By 2020 the Manchester City region will have pioneered a new model for sustainable economic growth based around a more connected, talented and greener city region where the prosperity secured is enjoyed by the many and not by the few”. As part of the bespoke Deal for Cities, the Council has been developing an Investment Model with other GM authorities, that supports the delivery of strategic priorities through the clear prioritisation of a pipeline of projects based on the contribution they make to jobs and growth and the packaging and targeting of funding to deliver them. The project pipeline includes projects that support commercial and physical developments, transport and broadband infrastructure, business support, housing and low carbon projects. 5. The Investment framework builds on the work that GM has done to develop the Greater Manchester Transport Fund and the Evergreen (JESSICA) fund for
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