Issue - meetings

Caroline Ryba, Head of Finance

Neil Krajewski, Deputy Head of Finance

 

Key decision

The council continues to develop and expand well-established, long term capital planning. This report presents the capital strategy of the council together with a summary capital programme for the General Fund (GF) and Housing Revenue Account (HRA). The previous capital strategy was approved by Council on 24 February 2022. The strategy is focused on providing a framework for delivery of capital expenditure plans over a 10-30 year period. These plans cover spending on operational assets to support service delivery and on investments which provide an income for the council alongside meeting the council’s objectives in relation to economic development and place-making, regeneration and climate change mitigation. Governance arrangements are also outlined in order to ensure the capital programme continues to deliver value for money.

 

Decision of the Executive Councillor for Finance, Resources and Transformation and Non-Statutory Deputy Leader recommended to Council:

 

• The capital strategy to Council

• Note the summary capital programme

 

Reason for the Decision

As set out in the Officer’s report.

 

Any Alternative Options Considered and Rejected

Not applicable.

 

Scrutiny Considerations

 

The Deputy Head of Finance introduced the report.

 

The Head of Finance and the Deputy Head of Finance said the following in response to Members’ questions:

 

      i.         How proportionality is measured was that it is an ongoing assessment. It was about risk. It was about the proportion of the Councils income that was reliant on commercial activities and the proportion that is council tax, business rates, government grants for example. There was a higher risk around commercial income.

     ii.         Equality and Poverty implications are measured by complete equality impact assessments. There was an equality impact assessment attached to the budget setting report. There were specific indications when it comes to anti-poverty.

    iii.         Had conversations with Lion Yards owner/operator in regards to the re-generation of this commercial area. The owner/operator decided to not involve the Council.

   iv.         On Park Street there were three different tranches of borrowing which the Council would be drawing down. The drawdown of the £85 million loan is spread over 2-3 years. The interest rate was variable on the three tranches and it is between 1.6-1.7%. If the Council were to arrange Public Works Loan Board (PWLB) loans at this point in time, to draw down now interest rates would be 4.5-5%.

     v.         When asked how much this would save the council over the life of the loan stated that could not give an exact number at this moment and would need to get back to Committee about that. However can say is it would be in the millions of pounds.

 

The Director of Enterprise and Sustainable Development said the following in response to Members’ questions:

 

      i.         The Council needs to be clear about its social purpose. Many of the smaller commercial units have played a part in that. The overarching valuations of the investment plan over a longer term the values are going up and the rental income is going up. They were working to minimise voids and support business through a difficult period and an ongoing difficult period. Over the last two years they have been working on setting up payment plans to avoid voids.

     ii.         The re-letting of smaller spaces, there are a wide range of uses that can meet the rental income within the city.

    iii.         Overall, the value of the commercial portfolio is rising over a long-term basis.

   iv.         The asset management plan will be published in the spring.

 

The scrutiny committee unanimously approved the recommendations.

 

The Executive Councillor for Finance, Resources and Transformation and Non-Statutory Deputy Leader approved the recommendations.

 

Conflicts of interest declared by the Executive Councillor (and any dispensation granted)

 

No conflicts of interest were declared by the Executive Councillor.