Contact: Nick Gibbins, ext 7544

1 Summary

1.1 The following decisions are sought:

That the capital programme for 2002/03 to 2005/06 as set out in Appendix 1 be incorporated as part of the final capital programme strategy report including such amendments as may be agreed by the Executive Member for Policy and Resources (the Leader).

2 Reason

In order that the capital programme for Policy and Resources may be considered for inclusion in the County Council's capital programme for 2002/03 to 2005/06.

3 Other options considered and rejected:

A programme is proposed within the provisional guidelines set by the Cabinet on 17 December 2001.

4 Conflicts of interest declared by the decision maker or a member or officer consulted - not applicable

5 Dispensation granted by the Standards Committee - not applicable

6 Reason(s) for the matter being dealt with if urgent - not applicable

Approved by: Date:

.................................... .................................

Councillor T K Thornber

Contact: Nick Gibbins, ext 7544

1 Summary

1.1 This report proposes a capital programme for 2002/03 to 2005/06 in Appendix 1, within the provisional guidelines set by the Cabinet on 17 December 2001 and considers the priorities for additional locally resourced schemes in 2003/04 and later years. The Policy and Resources Executive member is being recommended to agree:

i) That the capital programme for 2002/03 to 2005/06 as set out in Appendix 1 be approved for submission to the Cabinet

ii) That priority be given to increased resources for Capital repairs of non-Education properties in considering the scope for increasing the service's locally resourced programme guideline.

1.2 Prior to the Executive member considering the Capital programme this report is being presented to the Policy and Resources Policy Review Committee to provide the Committee with the opportunity to comment to the Executive member on the proposals.

2 Introduction

2.1 The Cabinet at its meeting on 17 December 2001 asked Executive members to prepare proposals for:

· a locally-resourced capital programme for the four-year period from 2002/03 to 2005/06 within the guidelines of the current capital programme uplifted for inflation, and

· capital schemes supported by scheme or programme specific Government grants and borrowing approvals for 2002/03 and those expected to be supported in 2003/04, 2004/05 and 2005/06.

2.2 For this service, the guidelines for the locally resourced programme are:

2.3 The guidelines include an addition of 2.5% for inflation, in line with the non-pay inflation assumption for the revenue budget, plus an additional provision to cover the impact on capital costs of the aggregates levy to be introduced by the Government from April 2002.

2.4 The Cabinet has retained £0.7m from the guidelines for the locally resourced capital programme for 2003/04 onwards to meet some of the pressures on the capital programme already identified in discussions between the Leader and Executive members. These include capital costs associated with byways open to all traffic (BOATS) and the renewal and replacement of waste recycling centres. Paragraph 5 of the report deals with Policy and Resources' proposals.

3 Capital Programme 2002/03 to 2005/06 - schemes within the guideline for the locally resourced capital programme

3.1 The primary role of the Policy and Resources capital programme is to support the County Council's property management policies, which recognise the corporate and integrated nature of asset management. These policies underpin the key aims of the corporate strategy. The programme's role in supporting the direct services provided by Policy and Resources is very much a secondary role.

3.2 The proposed programme for 2002/03 to 2005/06 continues to reflect the Committee's primary responsibility for asset management and maintains the allocation of resources between the various elements of the programme contained in the 2001/02 to 2004/05 capital programme. 2002/03 marks the final instalment in the four year programme of investment in Older Persons Homes totalling £7.1m, enabling £0.5m to be redeployed into the global capital repairs programmes in 2003/04 and subsequent years.

3.3 The guidelines have been supplemented by £550,000 in 2002/03 and £65,000 in 2003/04 to accommodate projects financed from the business units' reserves. Capital spending in 2002/03 is mainly directed towards the anticipated costs of relocating Hampshire Printing Services and County Supplies operations.

4 Capital programme 2002/03 to 2005/06 - schemes supported by Government approvals

4.1 Government approvals support the programme in three main areas - repairs to school buildings, through the New Deal for Schools condition programme, Government funding for electronic government and approvals from the Lord Chancellor for Magistrates Courts' capital projects.

4.2 The New Deal for Schools condition programme, together with capital allocations devolved direct to schools, give a very substantial boost to the funding available for capital repairs. Allocations have been agreed by the DFES up to 2003/04, the period covered by the Government's current spending plans. Table 1 below illustrates the increased funding allocated over the next two years compared with the programme in 2001/02:

4.3 The Government has announced that they will allocate capital grants of £200,000 in 2002/03 to each local authority to support proposals contained in their `Implementing Electronic Government' statements submitted to the Government last year. Subject to demonstrating that good progress is being made, further grants of £200,000 will also be paid in 2003/04. Though the grant allocation is welcome, this represents a very modest financial contribution towards the cost of developing on-line services in an authority of Hampshire's size.

4.4 Provision is included for an annual programme for computer software for Magistrates' Courts. This is supported by 80% grant and 20% supplementary credit approval by the Lord Chancellor's department.

5 Proposals for additionally locally resourced schemes

5.1 A sum of £0.7m per annum has still to be allocated to services within the locally resourced capital programme guidelines for 2003/04 onwards. As indicated in paragraph 2.4 a substantial proportion of this may be set aside for BOATS and waste recycling centres in line with the Council's Sustainable development strategy.

5.2 The County Council's capital strategy produced in July 2001 identified outstanding building maintenance liabilities of £277m over the next ten years, of which £45m relate to services other than Education. Though increased Government programmes directed at school repairs have resulted in more funding being available for school repairs than for many years, no equivalent increase in national resources has been made available to deal with the maintenance liabilities in the rest of the County Council's built estate. Increased resources for capital repairs which can be applied to non-Education priorities therefore represent the highest priority for any additional capital resources available to Policy and Resources' programme from any balance remaining within the £0.7m contingency set aside and this would help to prevent increased liabilities in future years.

6 Capital Programme Summary

6.1 On the basis of the position outlined above, the total value of the capital programmes submitted for consideration for the four years to 2005/06 are:

7 Revenue Implications

7.1 The revenue implications of the proposed capital programme are as follows:

Section 100 D - Local Government Act 1972 - background papers

The following documents disclose facts or matters on which this report, or an important part of it, is based and has been relied upon to a material extent in the preparation of this report.

NB the list excludes:

1. Published works.

2. Documents which disclose exempt or confidential information as defined in the Act.

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