Archived decisions

Decision Maker

Buildings, Land and Procurement Panel

Date of Decision

31 March 2009

Decision Title

Revenue and Capital Repairs Budget Allocations for 2009/10

Decision Reference

579

Report From:

Acting Director of Property, Business and Regulatory Services

Contact name

Sue Lapham

Tel

01962 847804

Email

[email protected]

1.1

The total repairs and maintenance revenue budget for 2008/09 is £16.022m.

1.2

The Policy and Resources capital repairs budget for 2008/09 including the carry forward from 2007/08 totalled £10.439m. The Panel meeting in October 2008 advised that £2m be carried forward to 2009/10 to support key corporate projects such as Hampshire Workstyle. As part of the subsequent budget process the Executive Member for Policy and Resources approved a further carry forward of £1m. The revised total for 2008/09 is therefore £7.439m.

1.3

The 2008/09 schools capital repairs budget funded by the revenue contributions from the Dedicated Schools Grant (DSG) including the carry forward from 2007/08 totals £13.2m.

1.4

The majority of the two capital budgets are allocated for works to mitigate key risk areas in the built estate.

2.1

Appendix 1 shows the level of commitment against the revenue budget as at 5 February 2009 as 91.6%. Although the level of commitment against individual allocations varies it is anticipated that the overall budget will be fully utilised by the year end however the winter maintenance contingency has not yet been fully committed. In previous years any unspent balance on this contingency has been carried forward in full and a recommendation to this effect was included in the Policy and Resources revenue budget report on 29 January 2009.

2.2

Appendix 2 shows the position against the combined capital repairs allocations with 77.6% of the budgets committed as at 5 February. Additional work has been planned for the remainder of the year which will bring the position closer to full commitment. However the cold weather at the beginning of February has had an impact on programme delivery and some slippage may occur.

3.1

The budget for 2009/10 includes an uplift of 2.25% for inflation in line with the budget strategy. After taking out the one-off increase in 2008/09 from the 2007/08 carry forward this gives a total budget of £16.048m.

3.2

As in previous years the budget figure relating to schools may be subject to minor change because detailed school budget allocations have yet to be confirmed.

3.3

The proposed allocations for 2009/10 are set out in Appendix 3. The proportions are in line with the 2008/09 allocations but will be reviewed during the year depending on emerging operational requirements and any changes reported to the Panel as part of the six monthly budget review report brought to the October meeting.

4.1

The Policy and Resources capital repairs budget is part of the locally resourced capital programme and its funding is largely dependent on the availability of capital receipts. To provide an affordable three year locally resourced programme from 2009/10 the budget strategy required the remaining two years of the existing three year programme to be reduced by one-third. This provided funding for a 2011/12 programme at the same lower level.

4.2

At its October meeting the Panel advised a carry forward of £2m from the 2008/09 budget to provide resources to support key corporate initiatives such as Hampshire Workstyle and delivering the Carbon Reduction Commitment (CRC). This was supplemented by a recommendation as part of the Policy and Resources capital budget report to carry forward a further £1m to provide further resources for corporate projects and to allow some smoothing of the impact of the reduced programme level.

4.3

The budget process also brought forward initial proposals for use of the carry forward as follows:

· A one-off virement to revenue of £249,000 to support the setting up of the Hampshire Workstyle project team. Over the longer term the team will be funded from savings accruing from the project.

· A further one-off virement to revenue of £187,000 to provide pump-priming funds towards achieving the targets required by the CRC.

· A one-off virement to revenue of £200,000 to offset the loss of fee income associated with the reduced capital programme while other longer-term measures are put in place.

4.4

After allowing for all the adjustments referred to above, the Policy and Resources capital repairs budget for 2009/10 totals £6.458m including the balance of the carry forwards. The 2010/11 and 2011/12 budgets total £4.075m and £4.078m respectively. This represents a reduction of just under £2.4m in each year against the 2009/10 programme and some further re-profiling of resources may be required to smooth the impact of the reduction while maintaining sufficient resources to support corporate initiatives.

4.5

This report also proposes a further one-off virement to revenue of £75,000. The department will be commencing the roll-out of the corporate Hantsfile software in 2009/10. Hantsfile is seen as an essential precursor to Workstyle providing a single information management system that supports mobile and flexible working regardless of work location. To support the implementation it is proposed to vire a further £75,000 of the capital repairs carry forward in 2009/10 to deliver a discrete pilot project and further define project scope and costs for phased implementation. If supported this proposal would reduce the 2009/10 capital repairs contingency shown in Appendix 4 by this amount.

Dedicated Schools Grant (DSG) capital repairs

4.6

The DSG capital repairs budget is not part of the locally resourced programme and therefore has not been subject to the reduction of one-third. After including inflation the programme for 2009/10 is £11.461m with similar funding in each of 2010/11 and 2011/12 of £11.748m.

Proposed allocations: 2009/10 capital repairs

4.7

As in previous years the majority of the programme will be utilised to support works to mitigate key strategic risks in the built estates such as fire safety, mechanical and electrical services failure and asbestos.

4.8

The proposed allocations for the combined Policy and Resources and DSG capital repairs budgets are shown at Appendix 4.

New Deal for Schools (NDS)

4.9

The budgets for 2009/10 and 2010/11 are £7.712m and £6.411m respectively. NDS funding which is a mix of capital grant and supported borrowing has not yet been confirmed beyond 2010/11 by the Government. The assumption used in preparing the three year capital programme was that funding would continue at 2010/11 levels. However, the current programme, confirmed as part of the Comprehensive Spending Review 2007, has seen a noticeable reduction in funding compared to the previous three years and it remains possible that this trend will continue.

4.10

In December the Government as part of their strategy to counteract the impact of the recession on the construction industry asked local authorities whether any capital spending plans relating to schools could be brought forward from 2010/11 to 2009/10. Hampshire's response included a proposal to bring forward NDS Condition schemes of value £2.484m from 2010/11. The proposal is still being considered and a response expected during March. Should the acceleration go ahead the respective budgets for 2009/10 and 2010/11 would be adjusted accordingly to leave £10.196m in 2009/10 and £3.927m in 2010/11. This would leave a considerably smaller programme in 2010/11 however the emergence of other major new workstreams such as Building Schools for the Future (BSF) and Hampshire Workstyle are expected to require significant redeployment of resources by this time and this reprofiling would support that transition.

Smart meters in schools

4.11

As part of the work required to prepare for the requirements of the Carbon Reduction Commitment the Schools Forum has agreed to provide one-off funding of £1m from their 2007/08 carry forward to support the provision of smart meters in schools.

Sure Start Early Years capital repairs

4.12

The Sure Start grant provides a modest allocation for capital repairs to Children's Centres. The figures for 2009/10 and 2010/11 are £453,000 and £477,000 respectively. As with NDS the Government has not yet confirmed funding beyond 2010/11 and again it has been assumed that it will continue at the same level in 2011/12.

8.1

The revenue outturn position for 2008/09 is expected to be broadly in balance with the potential for some carry forward of the winter maintenance contingency.

8.2

The total revenue budget available for 2009/10 is £16.048m with total available capital funding of £27.084m. The capital funding would increase to £29.533m if the proposed acceleration of the 2010/11 NDS programme is approved by the Government.

8.3

A programme of work for 2009/10 has been developed to address key risk areas in the built estate.

LINKS TO THE CORPORATE STRATEGY

Yes

No

Hampshire safer and more secure for all

X

Corporate Business plan link no (if appropriate)

Maximising well-being

X

Corporate Business plan link no (if appropriate)

Enhancing our quality of place

X

Corporate Business plan link no (if appropriate)

OR

This proposal does not link to the Corporate Strategy but, nevertheless, requires a decision because:

OTHER SIGNIFICANT LINKS:

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Section 100 D - Local Government Act 1972 - background documents

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