Agenda Document Pack - North Ayrshire Council - 28/02/2024
North Ayrshire Council · 28 February 2024
Back to North Ayrshire Council — 28 February 2024 and its agenda
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North Ayrshire Council, Cunninghame House, Irvine KA12 8EE North Ayrshire Council A Special Meeting of the North Ayrshire Council will be held in the Council Chambers, Ground Floor, Cunninghame House, Irvine, KA12 8EE on Wednesday, 28 February 2024 at 14:00 to consider the undernoted business. Meeting Arrangements - Hybrid Meetings This meeting will be held on a predominantly physical basis but with provision, by prior notification, for remote attendance by Elected Members in accordance with the provisions of the Local Government (Scotland) Act 2003. Where possible, the meeting will be live-streamed and available to view at https://north-ayrshire.public- i.tv/core/portal/home. 1 Apologies 2 Declarations of Interest Members are requested to give notice of any declarations of interest in respect of items of business on the Agenda. 3 General Services Revenue Estimates 2024/25 to 2026/27 Submit report by the Head of Service (Finance) on (a) the Council's revenue spending requirements and anticipated funding for 2024/25 to 2026/27, (b) the level of reserves and fund balances held by the Council and (c) options to address the funding gap (copy enclosed). 4 Capital Investment Programme 2024/25 to 2033/34 Submit report by the Head of Service (Finance) on the draft Capital Investment Programme to 2033/34 (copy enclosed). 1
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North Ayrshire Council, Cunninghame House, Irvine KA12 8EE 5 Revenue Estimates 2024/25 - Common Good Funds and Trusts Submit report by the Head of Service (Finance) on the anticipated annual income and expenditure of the Common Good Funds and Trusts administered by North Ayrshire Council and to seek approval for the level of grant funding to be made available for disbursement in 2024/25 (copy enclosed). 6 Treasury Management and Investment Strategy 2024/25 Submit report by the Head of Service (Finance) on the proposed Strategy for Treasury Management and Investment activities within the Council for the financial year 2024/25 (copy enclosed). 7 Urgent Items Any other items which the Provost considers to be urgent. Webcasting Please note: this meeting may be filmed/recorded/live-streamed to the Council's internet site and available to view at https://north- ayrshire.public-i.tv/core/portal/home, where it will be capable of repeated viewing. At the start of the meeting, the Provost/Chair will confirm if all or part of the meeting is being filmed/recorded/live-streamed. You should be aware that the Council is a Data Controller under the Data Protection Act 2018. Data collected during the webcast will be retained in accordance with the Council’s published policy, including, but not limited to, for the purpose of keeping historical records and making those records available via the Council’s internet site. Generally, the press and public seating areas will not be filmed. However, by entering the Council Chambers, using the press or public seating area or (by invitation) participating remotely in this meeting, you are consenting to being filmed and consenting to the use and storage of those images and sound recordings and any information pertaining to you contained in them for webcasting or training purposes and for the purpose of keeping historical records and making those records available to the public. If you do not wish to participate in a recording, you should leave the meeting. This will constitute your revocation of consent. If you have any queries regarding this and, in particular, if you believe that use and/or storage of any particular information would cause, or be likely to cause, substantial damage or distress to any individual, please contact dataprotectionofficer@north-ayrshire.gov.uk. 2
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North Ayrshire Council, Cunninghame House, Irvine KA12 8EE North Ayrshire Council Sederunt John Bell Timothy Billings Marie Burns Eleanor Collier Joe Cullinane Scott Davidson Anthea Dickson Stewart Ferguson Todd Ferguson Robert Foster Scott Gallacher John Glover Tony Gurney Alan Hill Cameron Inglis Margaret Johnson Amanda Kerr Christina Larsen Shaun Macaulay Jean McClung Nairn McDonald Matthew McLean Louise McPhater Davina McTiernan Tom Marshall Jim Montgomerie Ian Murdoch Donald Reid Donald L Reid Chloe Robertson Ronnie Stalker Angela Stephen John Sweeney Chair: Apologies: Attending: 3
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NORTH AYRSHIRE COUNCIL 28 February 2024 North Ayrshire Council Title: General Services Revenue Estimates 2024/25 to 2026/27 Purpose: To advise Council on (a) the Council's revenue spending requirements and anticipated funding for 2024/25 to 2026/27; (b) the level of reserves and fund balances held by the Council and (c) options to address the funding gap. Recommendation: That Council: a) notes the anticipated funding available to meet the Council’s expenditure requirements and notes the areas of ongoing financial risk to the Council; b) approves the Council's expenditure requirements for 2024/25 and notes the indicative requirements for 2025/26 and 2026/27; c) approves the new strategic investments outlined in section 2.7.3 of the report; d) notes the projected outturn position for 2023/24; e) notes the level of reserves and fund balances held by the Council and approves any use and contributions to and from these; f) approves the additional contribution to the HSCP noted at 2.8.1; g) approves efficiencies and savings to ensure a balanced budget for 2024/25, consequentials and new proposals in future years; h) approves the schedule of Council fees and charges detailed in Appendix 6; i) determines the level of Council Tax for 2024/25 and agrees to freeze Council tax at 2023/24 levels, noting the Scottish Government funding to support this, as set out in section 2.3; j) notes the anticipated funding gaps for 2025/26 and 2026/27; k) considers the equality and children’s rights impact of any proposed service changes; l) notes the feedback from the community Budget engagement exercise to help inform budget plans; m) notes progress to date on the Council’s Sustainable Change Programme and corporate Workforce Planning; and n) approves the budget matrix for 2024/25. Agenda Item 3 5
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1. Executive Summary Introduction 1.1. Section 93 of the Local Government Finance Act 1992 requires Councils to determine the levels of expenditure in the forthcoming financial year, and thereafter to set council tax sufficient to cover any unfunded balance. 1.2. This report provides Members with an overview of the Council's anticipated financial position on the General Fund revenue budget for the next three financial years, 2024/25 to 2026/27. It also sets out the information required to enable the Council to set a balanced budget and its Council Tax for 2024/25 by 11 March as required by statute. 1.3. The Long-Term Financial Outlook 2024/25 to 2033/24 report, incorporating the Medium-Term Financial Outlook 2024/25 to 2026/27 was presented to Council on 13 December 2023. In addition, regular Elected Member briefing sessions were held between October 2023 and February 2024, during which officers provided Members with information on the financial pressures faced by the Council and options to reduce net expenditure within the context of the priorities set out in the new Council Plan 2023-2028. Revenue Budget 1.4. When the Council set its budget for 2023/24 on 1 March 2023 the decisions taken resulted in a balanced budget for 2023/24 with indicative funding gaps of £17.126m and £10.834m for 2024/25 and 2025/26 respectively. 1.5. The Medium-Term Financial Plan (MTFP) for 2024/25 to 2026/27 builds on last year’s MTFP and the analysis reflected in the Medium-Term Financial Outlook. The proposals in this report provide a balanced budget for 2024/25, although it should be noted that this required a planned use of £5.000m reserves, with indicative net funding gaps remaining for 2025/26 and 2026/27 of £8.141m and £8.558m respectively. This position incorporates the full year effect of proposed savings in 2024/25 and a planned use of reserves of £4.000m in 2025/26 and £3.500m in 2026/27 and continues to present a significant challenge to the sustainability of the Council’s finances. A summary of the key components underpinning this is provided at section 2.7. 1.6. Detail is provided at section 2.5 on the anticipated level of earmarked, unearmarked and specific reserves with unearmarked reserves projected at the level of 2.0% equal to £8.445m, earmarked reserves of £78.090m and specific reserves of £6.365m aligning with anticipated future commitments. The Council’s Useable reserves position will continue to be monitored. 1.7. The MTFP includes a range of savings proposals required to deliver a balanced Budget position for 2024/25, and a profiled use of reserves to help mitigate the significant financial challenges facing the Council and this is set within the context of a proposed Council tax freeze for 2024/25 to help address the financial pressures faced by communities. Against this backdrop 6
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the reduction in employer pension contributions in 2024/25 has provided an opportunity for non-recurring investment to support priorities. The proposed investment is outlined in section 2.7.3 of the report. Council is asked to consider these proposals. Health and Social Care Partnership 1.8 The Director of the Health and Social Care Partnership (HSCP) has provided Members with information on pressures and areas of potential savings to inform the Council’s proposed contribution to the Partnership. This information is not detailed within the Council’s budget proposal on the basis that the final position will be determined by the Integration Joint Board (IJB). 1.9 The proposed additional contribution for 2024/25 is currently £5.292m. This reflects the requirements as set out in the local government finance settlement. Further funding in respect of the HSCP is expected and still to be distributed. 1.10 The Integration Scheme approved by Scottish Ministers states that following determination of the Council and NHS payment to the IJB, the IJB will refine its Strategic Plan and planned service delivery to take account of the totality of resources available, delivering a balanced budget. Chief Finance Officer Assurance 1.11 The 2024/25 annual budget and 2024/25 to 2026/27 MTFP has been informed by the Council’s Long-Term Financial Outlook and previous MTFP. Significant scrutiny of the underlying assumptions and savings delivery has been undertaken to ensure the 2024/25 annual budget is robust. It is the responsibility of Chief Officers, including the HSCP, to manage any variance from the underlying assumptions. 1.12 The report notes at 2.14 the significant risks to the financial sustainability of service delivery. Within this context, apart from the uncertainty around future funding levels from Scottish Government, there are two significant financial risks that the Council is managing. They include the risk of the 2024/25 pay award being agreed at a level in excess of the budgeted 3% contribution and without any further Scottish Government support this would have a material impact on the Council’s finances. The ongoing position around maintaining teacher numbers runs contrary to the Council’s individual circumstances, impacted through a reduction in the pupil roll demographic and Attainment Challenge funding. There is a risk that an element of funding to support teachers could be withdrawn. Discussions continue with Scottish Government in this regard. 1.13 Allied to the risks facing the Council, there is the requirement for the Council to hold a sufficient level of Reserves. The level of Reserves set out in the Budget aligns with known future commitments. The Change and Service Redesign Fund will require to be kept under review to ensure sufficient resources are available to continue to support the Council’s Sustainable Change programme. Unearmarked reserves continue to remain at the lower 7
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level of recognised best practice and reflects 2% of the Council’s revenue budget. 1.14 The Scottish Government have also agreed in a letter dated 8 February 2024 to confirm the approach to the approximate £45.000m expected in consequentials resulting from the announcement of funding for councils in England. It is anticipated that the position around this will be known in March 2024. 2. Background 2.1 Financial Context 2.1.1 The Long-Term Financial Outlook 2024/25 to 2033/24 report, incorporating the Medium-Term Financial Outlook 2024/25 to 2026/27 was presented to Council on 13 December 2023. This is the cornerstone of the Council’s strategic financial planning framework. This has helped inform the development of the Medium-Term Financial Plan 2024/25 to 2026/27. 2.1.2 The economic outlook for the Scottish, UK and global economy continues to be influenced by the impact of global events, resulting in inflation higher (CPI 4% January 2024) than the Bank of England target of 2% and interest rates remaining at 5.25%. The level of inflation will remain an important factor in local government pay negotiations across several bargaining groups. The impact of inflation on the Council’s cost base, coupled with an increased cost of borrowing to support the Capital programme, continues to place significant strain on the sustainability of the Council’s finances. 2.2 Scottish Government Funding 2.2.1 The Local Government Finance Settlement for 2024/25 was published on 21 December 2023. Funding support from the Scottish Government comprises: • general revenue grant; • non domestic rate income; and • specific grant. 2.2.2 North Ayrshire Council's anticipated Scottish Government funding support, as distributed, for 2024/25 is £353.087m. 2.2.3 The Settlement resulted in a reduction of £2.191m in core grant funding (- 0.64%) when compared to the 2023/24 settlement. The main elements of the budget announcement from a national perspective includes the following; • £950.9 million of funding has now been baselined into the General Revenue Grant noted as part of the commitment under the Verity House Agreement to review ring-fenced funding. This is not additional funding, simply a baselining of funding that comes with existing commitments; • £242 million to support teacher pay uplifts; and • £266.2 million of resource to support local government pay. 8
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• £145.5m (NAC £3.775m) to continue to maintain teachers and support staff. On the 12 February 2024 the Cabinet Secretary for Education and Skills announced that this funding for 2024/25 would now be held as a Specific Resource Grant, and those grants will be conditional on Councils agreeing to maintain teacher numbers. Further engagement with individual councils will take place to consider each Council’s individual circumstances and to agree grant conditions, including the number of teachers expected to be maintained. The circumstances for North Ayrshire include the reduction in Scottish Attainment Challenge funding and a falling pupil roll demographic; • An additional £6m to support the expansion of Free School Meals; This includes £4.000m allocated (NAC £0.148m) to support P6/P7 pupils with families in receipts of the Scottish Child payment. The balance of £1.5m is still to be distributed and will be used to address school meal debt. Further details to follow around this. • An additional £11.5m to support the uprating of Free Personal and Nursing Care rates is still to be distributed; • Additional funding of £230m to deliver a £12 per hour minimum pay settlement for adult social care workers in commissioned services via agreed contract uplifts is still to be distributed; • An additional £6.8m nationally for Discretionary Housing Payments. 2.2.4 The Settlement announcement also included updates on areas of potential financial flexibility to be progressed as part of the Verity House Agreement and development of the Fiscal Framework; • The Scottish Government are open to considering adjusting the funding floor percentage. In the short-term this would provide further funding uncertainty and from an NAC perspective “the floor” adjustment helps mitigate the financial impact of a reducing population demographic. COSLA has subsequently indicated to Scottish Government that this should not be considered as part of the 24/25 Budget. • The SG is progressing discussions to increase discretion for local authorities to determine and set fees and charges locally. Areas for discussion include building warrant and verification fees. Progress around this should help inform the 2025/26 Budget. • The settlement did not include additional funding for teacher pension contributions. The rate is set to increase from 23% to 26% from 1 April 2024. The UK Government has stated that the funding will be allocated to individual UK Government departments in Spring 2024 through consequentials. The Scottish Government has subsequently committed to pass this funding to local authorities when it is received which amounts to c£2.000m per annum for NAC. • Further discussion on flexibility around Education funding lines will take place within the Education Assurance Board once it is operational. The expectation is also that Councils will continue to honour the existing joint agreement on provision of free school meals on a universal basis. 9
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• The Scottish Government have confirmed that they have no plans in the immediate future to commence the Capital Accounting Review which was proposed in the Resources Spending Review in May 2022. From an NAC perspective this is welcome as this could have a significant financial impact, linked to the prescribed accounting treatment of loans Fund repayments, and impact the affordability of delivery of the capital programme across both the general fund and the HRA. This impact would apply across Scotland and continues to present a risk to the Council. 2.2.5 The 2024-25 Non-Domestic Basic Property Rate (‘poundage’) is provisionally set at 49.8 pence, the same rate as last year. The Intermediate Property Rate (levied on properties with a rateable value from £51,001 to £100,000) and Higher Property Rate (levied on properties with a rateable value over £100,000) will increase by inflation to 54.5 pence and 55.9 pence respectively. 2.2.6 A 100% non-domestic rates relief will be available in 2024-25 for properties in the hospitality sectors on islands, as defined by the Islands (Scotland) Act 2018, capped at £110,000 per ratepayer. This will provide economic benefit to the island communities. 2.2.7 In terms of Scottish Government requirements, the Deputy First Minister confirmed that funding allocated to IJB’s for Free Personal and Nursing Care and adult social care pay in commissioned services should be additional and not substitutional to each Council's 2023-24 recurring budgets for adult social care services that are delegated. Where there is evidence that funding is not passed across to be used for the policy intent, the Scottish Government reserves the right to reclaiming this. 2.2.8 As noted in section 2.2.3 of the report the requirement to maintain teaching and support staff numbers will require further engagement with individual councils to consider individual circumstances and agree grant conditions, including the number of teachers expected to be maintained. The circumstances for North Ayrshire include the reduction in Scottish Attainment Challenge funding and a falling pupil roll demographic. Funding included in the Settlement to support teachers included the national allocation of £145.500m, of which the NAC share is £3.775m. The Cabinet Secretary for Education and Skills outlined in a letter dated 12 February 2024 that these funds will now be distributed via Specific Resource Grants. It is recognised that this position presents a financial risk to the Council, however, the extent of this risk will likely depend on the outcome of discussions with the Scottish Government on the Council’s individual circumstances. 2.2.9 For 2025/26 and 2026/27 the current planning assumption is that the level of core grant support will be flat cash and remain at the same level for each year. For context a 1% reduction in core grant equates to around £3.000m. This assumption is based on a broadly flat cash funding position for local government, as reflected in the Scottish Government Spending Review published in May 2022. 10
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2.3 Council Tax 2.3.1 Local authorities have discretion to increase Council Tax. Section 74 of the 1992 Act sets the proportions payable by each council tax band. As such, Councils can only apply a standard percentage increase across all Council Tax bands, they cannot vary the percentage increase between bands. 2.3.2 The 2024/25 Settlement did not include funding to support a Council Tax freeze, however this is the Scottish Government’s intention. The Depute First Minister issued a letter to Councils on 2 February 2024 setting out the details of an alternative distribution of funding to support a Council tax freeze. The total funding available is £147.200m with a NAC allocation of £3.453m. It is important to note that this funding is conditional on the Council agreeing a Council tax freeze for 2024/25. Any council not agreeing to freeze Council Tax will not receive a share of this funding. It has also been confirmed by the Scottish Government that this funding will be baselined into future year Revenue Grant funding. 2.3.3 The MTFP includes a planning assumption for 2024/25 of a freeze in Council tax, this being supported with Scottish Government funding and baselined into future years. This is followed by a current planning assumption of a further 3% increase for 2025/26 and 2026/27. Council Tax income is a vital source of funding and represents around 17% of Council funding. 2.3.4 The planning assumption of a Council Tax freeze will result in Council Tax charges for 2024/25 remaining at 2023/24 levels. This is illustrated in the undernoted table for each property band (excluding charges for water and waste water charges). Water and waste water charges are set by the Scottish Water Board and recent notification indicates a 8.8% increase. 2.3.5 Comparative information on Band D is provided within the Council Tax leaflet that is issued with Council Tax Bills. The comparative information for 2023/24 is as follows; Scotland £1,417.00 North Ayrshire Council £1,452.12 A Under £26,999 £968.08 - £968.08 B £27,000 to £34,999 £1,129.42 - £1,129.42 C £35,000 to £44,999 £1,290.77 - £1,290.77 D £45,000 to £57,999 £1,452.12 - £1,452.12 E £58,000 to £79,999 £1,907.92 - £1,907.92 F £80,000 to £105,999 £2,359.69 - £2,359.69 G £106,000 to £211,999 £2,843.73 - £2,843.73 H Over £212,000 £3,557.69 - £3,557.69 Band Valuation (at 1991 levels) 2023/24 Council Tax Proposed Increase 2024/25 Council Tax 11
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2.3.6 Following a recent consultation, the Scottish Government has now published the Council Tax (Variation for Unoccupied Dwellings) (Scotland) Amendment Regulations 2023, under which councils will have the power to vary the Council Tax charge for second homes from the current 100% charge to include a premium of up to a further 100% of the applicable Council Tax charge. 2.3.7 The main policy intent behind these powers is to mitigate the negative impacts of second home ownership across our communities through the promotion of a behavioural change across second homeowners which leads to a better balance between second homes and more permanently occupied homes. This could also help increase the supply in the private rented sector and benefit local economies with a shift in more housing occupancy throughout the year. It is also recognised that within the context of the Medium-Term Financial Outlook, these powers could result in significant additional revenue to the Council, therefore helping to protect vital services. 2.3.8 In deciding whether and how to use these new powers, the Council must have regard to island communities, given the number of second homes on the Isles of Arran and Cumbrae. On 14 February 2024 Council agreed to consult on the proposal to implement an increased Council Tax charge on second homes in North Ayrshire. The results of the consultation will be shared with elected members and be included for consideration as part of the 2025/26 Budget process. 2.4 Probable Outturn 2023/24 2.4.1 Based on the revenue financial performance report for 2023/24 at the end of November 2023, a projected overspend of £0.264m is forecast. The factors contributing to this were reported to Cabinet on 16 January 2024. 2.4.2 No further material movement is anticipated to the end of the 2023/24 financial year end, however, the overall level of overspend has been reducing throughout the year and is trending towards a break-even position on 31 March 2024. This is the position reflected in the level of anticipated Council reserves on 31 March 2024. This position could be subject to change as the Council continues to face significant inflationary cost pressures across a range of areas. Any overspend position at 31 March 2024 will require to be met from existing earmarked reserves. 2.5 Reserves, Fund Balances and Investment Introduction 2.5.1 Setting the General Fund Reserve is one of several related decisions in the formulation of the MTFP and the annual revenue budget. In setting its budget the Council must have a clear reserves policy that takes account of known commitments, potential liabilities and the risk profile of the Council and 12
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providing flexibility to deal with unforeseen circumstances. The right level of reserves supports financially sustainable service delivery. The Council’s approach is in line with CIPFA’s recommended practice as set out in the document “Local Authority Reserves and Balances”. Application of Reserves 2.5.2 North Ayrshire Council has used reserves in setting its budget over several years. This has included a reduction in unearmarked reserves, release of earmarked reserves no longer required and application of in-year underspends. Use of reserves provides a temporary solution but it is recognised that more sustainable approaches are required. A summary of application of reserves is noted below; • In 2017/18 £8.782m funded the HSCP Challenge Fund and supported non-recurring expenditure; • In 2018/19 and 2019/20 £3.500m and £3.880m respectively supported the core recurring budget. • In 2020/21, following a review of earmarked reserves, a total of £0.548m was released to support the 2020/21 Budget. • In 2021/22, following a review of corporate contingency funds, a total of £0.862m was released to support the 2021/22 Budget. • In 2022/23, no use of reserves was required to support the Budget. • In 2023/24, a total of £3.503m contribution was made from reserves. Reserves Policy Unearmarked Reserve 2.5.3 This reserve is held to ensure the Council remains in a prudent financial position in 2024/25 and could respond to major unforeseen incidents or emergencies. 2.5.4 The Council will continue to face several financial challenges through 2024/25 and beyond. These include the ongoing impact of inflationary pressures across Council budgets and the capital programme and the risk of additional costs through delivery of new policy commitments and more recently, through the risk of funding being withheld in the policy area of maintaining teacher numbers. 2.5.5 One of the most significant financial risks to the Council is the level of anticipated pay award that Councils would require to fund in 2024/25 and beyond. The current planning assumption included in the MTFP is 3% funding. It is noted that the relevant bargaining groups have set out initial positions which far exceed this level. From a budget planning perspective, it is anticipated that any agreed pay increase in excess of 3% would require to be funded by Scottish Government. It is recognised however that there is a risk in making this assumption. For context, inflation based on the CPI measure remains at 4% as January 2024. Any pay award in excess of a 3% increase that requires to be funded by the Council would require the Council in the first 13
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instance to draw funding from current reserves, and for the recurring pressure to be incorporated into the 2025/26 Budget process. 2.5.6 It is anticipated on 31 March 2024 the balance of unearmarked reserves will be £8.445m which equates to 2.0% of the Council’s net expenditure budget. This level of unearmarked reserve is at the lowest end of the recommended range of 2% - 4% for general reserves. Earmarked Reserves 2.5.7 These Funds have been approved for carry forward to meet known commitments or liabilities which will be settled in future years. Current earmarked funds include: • Affordable Housing – accumulated from Council Tax collected from second homes and long-term empty properties; • Project-specific funds - these funds will be carried forward from 2023/24 to allow for the completion of specific projects after 31 March 2024; • Workforce Planning Fund – To support the workforce planning programme and help address in-year pay award risks; • Prudential Investment Fund - resources to smooth the revenue implications of loan charges supporting the Capital Investment Programme; • Change and Service Redesign Fund – supports delivery of the Council’s Sustainable Change programme; • Renewal Fund to support a range of projects across key themes identified through the experiences from the pandemic; and • Investment Fund to support a range of sustainability and Community based projects. 2.5.8 On the 15 February 2023 Council approved the use of Service Concession flexibility to help mitigate the significant cost pressures and resultant revenue budget gaps over the medium-term and to help address the impact of construction cost volatility as part of delivering the Council’s ambitious Capital programme. The Council Budget meeting of 1 March 2023 approved the use of £16.146m of the total retrospective sum of £21.546m to be applied in a limited and controlled manner across several financial years and, critically, that this runs in parallel with more sustainable measures to reduce the cost base of the Council in line with available funding. In view of the scale of the financial challenges facing the Council, this is an essential element of the Budget programme over the medium-term. 14
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Specific Reserves 2.5.9 Specific reserves are held as follows; • Insurance Fund - the current balance on this Fund aligns with the most recent actuarial valuation, provision for uninsured claims and outstanding liabilities. • Capital Fund – This supports delivery the proposed capital investment programme. Summary 2.5.10 The projected accumulated balances on the Council's Funds and Reserves at 31 March 2024 are outlined in the table below, with the majority of these being earmarked for specific purposes. The value of reserves is anticipated to reduce during 2023/24 by £29.095m. 2.5.11 Based on the current financial landscape and the risks the Council faces the current level of Reserves is considered prudent. This position will be subject to continued review. 2.6 Income Summary 2.6.1 Total funding available to the Council to finance its expenditure plans in 2024/25 is noted in the table below. The main assumptions are as follows; Balance at 31 March 2023 Transfers Approved by Cabinet 24 Jan 2024 Projected Transfers to 31 Mar 2024 Transfers Included in Budget Paper Projected Balance at 31 Mar 2024 Anticipated Future Spend Projected Future Balance £m £m £m £m £m £m £m General Fund Unearmarked 8.053 - (0.264) 0.656 8.445 - 8.445 General Fund Earmarked Education DMR 0.006 (0.006) - - - - - Affordable Housing 2.038 (2.444) 1.168 - 0.762 (0.762) - Project Specific Funds 32.136 (6.991) (1.335) (0.656) 23.154 (23.154) - Prudential Investment Fund 18.904 (0.109) 5.627 - 24.422 (24.422) - Change and Service Redesign Fund 2.493 (0.290) (0.107) - 2.096 (2.096) - Renewal Fund 12.939 (0.084) (3.316) - 9.539 (9.539) - Investment Fund 11.119 (0.257) (4.975) - 5.887 (5.887) - Workforce Planning Fund 6.739 - (4.965) - 1.774 (1.774) - Future Budget Support 14.288 - - (5.000) 9.288 (9.288) - Cost of Living Fund 1.400 (0.232) - - 1.168 (1.168) - Total Earmarked Funds 102.062 (10.413) (7.903) (5.656) 78.090 (78.090) - Total General Fund Balances 110.115 (10.413) (8.167) (5.000) 86.535 (78.090) 8.445 Specific Reserves Insurance Fund 2.998 - - - 2.998 (2.998) - Capital Fund 8.882 0.035 (5.550) - 3.367 (3.367) - Total Specific Reserves 11.880 0.035 (5.550) - 6.365 (6.365) - Total General Fund Reserves 121.995 (10.378) (13.717) (5.000) 92.900 (84.455) 8.445 15
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• 2024/25 Scottish Government Funding in line with the Finance Circular of 21 December 2023 and the position has been updated to reflect recent funding announcements to support a Council tax freeze and various clarifications on subsequent distributions. A flat cash position in core funding is projected for years 2 and 3, excluding anticipated adjustments in respect of loan charge support. This position includes the baselining of 2024/25 funding to support a Council tax freeze; • An assumed Council Tax freeze for 2024/25 based on 2023/24 levels, with an appropriate adjustment for the number of households and further assumed increases of 3% per annum for 2025/26 and 2026/27 respectively; • Funding from Scottish Government to support an increase in teacher superannuation costs from 1 April 2024 has been included. The Scottish Government has committed to passporting this funding to local authorities following receipt from UK Government through consequentials in Spring 2024; • The contribution from earmarked reserves includes resources from the approved Service Concessions flexibility across the MTFP; • Funding to support Non Domestic Rates Empty Property Relief was devolved to local authorities in 2023/24; and • Outwith specific proposals, fees and charges have been uplifted by 5% annually. 2024/25 2025/26 2026/27 £m £m £m Aggregate External Finance 353.087 352.627 352.627 Additional Aggregate External Finance due: Teachers' Induction Scheme 0.734 0.734 0.734 Teachers' Superannuation Funding 2.116 2.116 2.116 Council Tax Freeze Funding 3.453 3.453 3.453 Council Tax 64.483 66.840 69.282 Council Tax Income for Affordable Housing 1.198 1.235 1.271 Contribution from Earmarked Reserves 5.000 4.000 3.500 Less NDR Empty Property Relief (2.803) (2.803) (2.803) Total Funding Available 427.268 428.202 430.180 16
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2.7 Expenditure Requirement 2.7.1 The revised expenditure requirement for 2024/25 is £431.427m and is summarised in Appendix 1. This is the 2023/24 base budget adjusted to reflect the outcome of a full review of service pressures, previously approved savings, operational budget adjustments, national expenditure requirements and the proposed funding contribution to the Health and Social Care Partnership. The main assumptions and pressures are summarised below; • Costs of continuing the current level of service; • Inflationary pressures, including assumed pay awards, teachers pensions, contractual commitments and utilities; • The financial implication of decisions already taken by the Council; • Socio economic and demographic pressures; 2.7.2 Changes to the level of employer contributions to the Strathclyde pension fund have been confirmed during 2023/24. The new rates include a 6.5% contribution rate for 2024/25 and 2025/26 and a 17.5% contribution rate for 2026/27. The Council’s expenditure requirements have been adjusted to reflect the new base contribution rate of 17.5%, however, the reduced rate of 6.5% has created an opportunity for non-recurring strategic investment across 2024/25 and 2025/26. It is essential however that the Council continues to address the structural funding gaps over the medium-term. The balance of investment after addressing pressures in loans fund support, which is required to deliver the Council’s capital programme, totals £3.614m in 2024/25. 2.7.3 To continue to progress the Council’s ambitious sustainability programme in contributing towards net zero and delivering a vital source of future revenue to the Council, and to invest in our town centres, Council is asked to approve the following non-recurring strategic investments for 2024/25; • £1.914m – Contribution to a renewable energy development at i3. This will contribute towards the total estimated £3.300m capital cost of construction of a 2MW wind turbine at the i3 strategic site. It is estimated that this would produce an annual energy yield of up to 5.3m KWH’s and could deliver an annual revenue source of up to £0.500m per annum. To realise the full financial return on investment to support the Budget programme, further contributions towards capital construction will be considered as part of 2025/26 Budget. • £1.700m – Locality based town centre fund - The Fund would support community led place-based investment for regeneration and town centre projects across localities. Potential projects could include town centre improvements and initiatives, infrastructure projects and green and open space improvements. It will be delivered following the Community Investment Fund (CIF) methodology and include the co-production of the application with the Regeneration team. Awards of between £5,000 and £100,000 will be permitted on this basis. 17
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2.7.4 In the absence of an agreed pay settlement for 2024/25 through COSLA, the SJC and SNCT (from August 2024), the financial planning assumption for pay inflation for 2024/25 remains at 3% and further 3% increases for 2025/26 and 2026/27 respectively. This is based on the limits of affordability rather than any prediction as to the level of pay agreement. The risk associated with this assumption is noted in section 2.5.5 of the report. 2.7.5 In establishing the expenditure requirements, no provision has been made for general non pay inflation resulting in a reduction in the purchasing power of the budgets affected. This is most acute across the range of services delivered through the Place Directorate. 2.7.6 Operational budget adjustments not impacting on Council policy or causing material changes to current service levels, are detailed in Appendix 2. 2.7.7 As part of the 2023/24 revenue budget, savings were approved which impacted 2024/25 and 2025/26 and they are detailed at Appendix 3. 2.7.6 Full details of expenditure requirements identified for 2024/25 to 2026/27, including new national expenditure requirements and all contractual and inflationary related pressures, as well as loans fund support to deliver the capital programme, are detailed in appendix 4. 2.7.7 Based on this expenditure forecast and incorporating the savings achieved through operational adjustments and those savings previously approved, remaining savings of £4.159m / £9.305m / £8.931m are required for 2024/25, 2025/26 and 2026/27 respectively. This position incorporates the planned use of reserves totalling £5.000m in 2024/25, £4.000m in 2025/26 and £3.500m in 2026/27. This funding landscape continues to present a significant challenge to the Council over the medium-term. 2.8 Health and Social Care Partnership 2.8.1 Information on pressures and areas of proposed savings are shared with North Ayrshire Council to inform the allocation of resources delegated to the IJB. As part of the recent 2024/25 budget announcement the Council plans to make a net contribution to the HSCP of £5.292m. It should also be noted that further resource distributions to the HSCP, aligned to specific policy areas, are expected throughout the course of 2024/25. 2.8.2 As a condition of the settlement, funding should be additional and not substitutional to each Council's 2023-24 recurring budgets for adult social care services that are delegated. 2.8.3 In recognition of the role of the Council and the Integration Joint Board (IJB), the financial information presented in this report is limited to the proposed contribution the Council will make to the IJB based on those funds which have already been distributed by the Scottish Government as part of the local 18
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government settlement, noting that final distribution of resources is a matter for the IJB. 2.8.4 The Integration Scheme approved by Scottish Ministers states that, following determination of the Council and NHS payments to the IJB, the IJB will refine its Strategic Plan to take account of the totality of resources available. Accordingly, the proposed financial contribution to the IJB of £5.292m in 2024/25 represents the full allocation required from the settlement for the HSCP to meet new and existing spending commitments, recognising that further distributions from Scottish Government will also occur throughout 2024/25 for particular policy areas. For years 2025/26 and 2026/27 the financial planning assumption from the Council is that the financial pressures facing the IJB will be met by savings. 2.8.5 The IJB currently holds a level of unearmarked reserves totalling £5.821m which equates to around 2.1% of the initial approved IJB budget for 2023/24. This is within, but towards the lower end of the target range of 2%-4%. Based on the reported position to the IJB on 14 December 2023, a deficit of £3.858m is forecast which will impact the reserves position in 2023/24. 2.9 Efficiencies and Savings Proposals 2.9.1 Proposals for efficiencies and savings have been made which will deliver a balanced budget for 2024/25. There are estimated net budget shortfalls of £8.141m and £8.558m in 2025/26 and 2026/27. This position, however, incorporates the planned use reserves of £5.000m in 2024/25, £4.000m in 2025/26 and £3.500m in 2026/27. The use of reserves is not a sustainable solution, but necessary due to the scale of the Budget challenges. Proposed savings, excluding the HSCP, are summarised at Appendix 5. The approach to the Budget Programme continues to focus on minimising the impact on communities, Council services, and the workforce, whilst delivering more financial efficiencies through the Council’s Sustainable Change programme. It is recognised that this approach will continue to get more challenging over the medium-term. 2.9.2 With the exception of some specific charging arrangements and those charges set nationally, it is proposed that the Council’s fees and charges in 2024/25 increase by 5%, with similar indicative increases in 2025/26 and 2026/27. This position will be reviewed in advance of the 2025/26 Budget. Members should note that no increase has been proposed in respect of school meals. The schedule included in Appendix 6 contains the charges with effect from 1 April 2024. It is important to note that fees and charge levels in respect of the HSCP is a matter for the IJB to consider. 2.10 Equality and Children’s Rights Impacts of Budget Proposals 2.10.1 The Council has a legal duty to consider the equalities and children’s rights impact of proposals on groups with protected characteristics, being age, disability; gender reassignment; pregnancy and maternity; race; religion or 19
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belief; sex; and sexual orientation. The Council also has a duty to assess the socio-economic impact of proposals (The Fairer Scotland Duty) and Island proofing. This requires an assessment of the impact of proposals on reducing inequalities. 2.10.2 Proposals contained in this report have been screened to assess whether there are any equalities and socio-economic impacts and, if so, the proposals have been equalities and children’s rights impact assessed (ECRIA). 2.10.3 The purpose of the ECRIA is to ensure that Members are fully informed in advance of taking decisions. They do not prevent Members from making decisions. All ECRIAs have an assessment of risk alongside mitigating actions. This enables Council to consider if any detrimental impact can be minimised and any positive impact maximised. 2.10.4 A link to all the relevant assessments across the budget savings categories is provided below; Full Impact Equality and Children's Rights Impact Assessments for Budget Proposals (sharepoint.com). 2.10.5 Any alternative proposals from Members will require to be screened and assessed to ensure Council is aware of impacts before making any decision. 2.10.6 Responsibility for the funding allocations within the HSCP rests with the IJB which has responsibility for assessment of the impact of the decisions it takes. 2.11 Community Budget Engagement 2.11.1 A change in approach to Budget engagement was undertaken for the 2024/25 Budget. The development of an on-line Budget Challenge tool provided citizens with the opportunity to set their own virtual Budget. The thinking behind this approach was to demonstrate the challenges faced by the Council in allocating financial resources across services against the backdrop of funding constraints and cost pressures. The task required the participant to set a balanced budget and therefore determine a level of relative priority across the range of services provided by the Council. The tool was launched on the 24 October 2023 and ran through 15 December 2023, with over 200 responses. This was followed up by an on-line locality engagement session delivered on 30 January 2024, which included representation from a range of community groups and associations. This process also included engagement with young people around the Budget challenges to determine what is important to them. 2.11.2 Elected Members have been issued with details of the feedback from the Budget Challenge exercise and are asked to consider this as part of the Budget setting process. It is recognised however that the overall level of response was relatively low and as such does not provide a representative level of opinion for the area, however, from the feedback gathered, the areas of services recognised as higher priority included; 20
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• Roads • Street Cleaning • Waste Services • Street Lighting • School Catering • Additional Support Needs and Early Learning and Childcare • Education and learning and Teaching 2.11.3 Feeback from young people included prioritisation of areas including youth work support, school catering and learning and teaching. 2.12 Sustainable Change Programme 2.12.1 Progress continues in developing an ambitious Sustainable Change Programme aligned to the Council’s priorities. It is important that a pipeline of activity continues to be identified, with a primary focus on generating financial efficiencies to help address the significant financial pressures across the MTFP. 2.12.2 The programme has expanded further and is subject to regular review and monitoring. The current workstreams include; • Use of Land and Property Assets including commercial and non- commercial property; • Transport and Travel and decarbonisation of the Council fleet; • Sustainability initiatives including major solar renewable energy investment; • Accessing Our Council and Financial Inclusion services, maximising our digital opportunities around support and contact. • Service reviews including Early Learning and Childcare, Waste Services and Housing Services 2.12.3 It is recognised that the more progress made through delivery of the Council’s Sustainable Change Programme, the less impact there could be on delivery of the Council’s core services. The financial options to address the Budget gap for 2024/25 include a range of measures from the work of this programme. They include income maximisation in commercial property, renewable energy investment that will deliver a revenue stream for the Council and a range of measures from the review of waste services. The Council’s Change and Service Re-design Fund requires to be kept under review to ensure it can continue to support the delivery of this programme. 2.13 Workforce Planning 2.13.1 The shape of the Council’s workforce is critical to the delivery of efficient and effective services. It is a significant factor in how we transform our Council and organise our workforce within the context of the Council’s key priorities and available funding. 21
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2.13.2 In order to be successful it is key for the workforce strategy, and the planning supporting this, to flow from the Council Plan and link to both people management and operational processes. To ensure the Council’s priorities are met, workforce planning must be flexible enough to manage short term activity but ultimately be focused on medium to long-term needs, ensuring that sustainable long-term savings are delivered. The workforce strategy, linked to the Medium-Term Financial Outlook, recognises and reflects significant external pressures and financial uncertainty. 2.13.3 Influenced by the scale of the financial challenges facing the Council over the coming years, there will continue to be organisational change, both in terms of structures but also, importantly, about how we work. During 2023/24 the Council progressed a Voluntary Early Release programme. This process has considered the scale of the financial challenges facing the Council and an assessment of the impact on service delivery and associated costs of exit for those staff who have volunteered for consideration. A report was presented to the Staffing and Recruitment committee on 23 November 2023, and it is anticipated that a total of 85 staff will be released by 31 March 2024. 2.13.4 North Ayrshire Council employs 7,510 staff, equivalent to 6,432 full time equivalent employees. Anticipated workforce implications associated with the MTFP over the next 3 years are summarised in the undernoted table. In 2024/25 the workforce is projected to reduce by 114.5 Full Time Equivalent posts (FTE’s). However, it should be stressed that all measures required to deliver a balanced budget for 2025/26 and 2026/27 have not been included at this time. It is, therefore, anticipated that this position will change through further development of the Budget Programme in 2025/26. Category 2024/25 FTE 2025/26 FTE 2026/27 FTE Operational Budget Adjustments (78.0) - - Previously Approved Savings +7.0 - - Pressures and Growth +20.0 - - New Savings Options (63.5) - - Total Workforce Implications (114.5) - - 2.13.5 Through a corporate workforce planning approach, any reduction to workforce levels will continue to be managed through natural attrition, vacancy management, redeployment and voluntary early release. 2.14 Management of Risk 2.14.1 North Ayrshire’s financial framework is underpinned by strategic, corporate, and operational risk registers. Given the significance of the financial risks the 22
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Council faces, this report sets out in the table below a number of the key risks associated with securing financial sustainability along with the likelihood and impact scoring. For all areas of material risk to the Council and planned mitigations, this is reported to Cabinet through the Council’s Strategic Risk Register. Likelihood Score Impact Score Financial Environment – Funding not keeping pace with cost-of-service delivery. Impacted by inflationary pressures and conditions attached to funding. 4 5 Financial Sustainability of the HSCP 4 4 Delivery of sustainable change programme - To address projected budget deficit, however, requires delivery at scale and pace. 3 4 2.15 Revenue Budget - Objective and Subjective Analysis 2.15.1 The Codes of Financial Practice outline categories of service delivery, known as the Objective Analysis, and categories of expenditure type, known as the Subjective Analysis. Based on the budget presented within this report, the budget matrix for 2024/25 is attached in Appendix 7. 2.15.2 Once this matrix is approved, services must spend in line with this and any subsequent significant and planned variation to this budget (i.e. virement) must be approved by Cabinet. 2.15.3 All North Ayrshire Council functions relating to health and social care are entirely delegated to the Integrated Joint Board, subject to appropriate reporting throughout the year to the Council. 2.16 Summary 2.16.1 The estimated financial position included in this report is set within the context of global, UK and national events. Rising costs continue to be influenced by inflation and the level of funding from Scottish Government for core services has fallen in both cash and real terms when compared to 2023/24. The Council continues to face a number of significant financial risks across policy areas like maintaining teacher numbers and the uncertainty around the level of 2024/25 pay award. 2.16.2 The Council via COSLA continues to have dialogue with Scottish Government across a range of areas including fair funding, multi-year financial settlements, maximising financial flexibility and the levels of funding ring-fenced to meet 23
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policy commitments. Currently, however, conditions around funding remain, which places a disproportionate burden on other areas of Council services. Based on the current cost and funding landscape, delivering balanced Budgets over the medium-term will be extremely challenging and will require a range of measures, including reduced investment in services, further service reform / re-design, additional revenue generation, the use of statutory powers available to the Council, financial efficiencies from the Sustainable Change Programme, use of Council reserves and a future level of Council Tax increase that recognises the level of inflation as well as the impact on citizens. 2.16.3 The table below summarises the incremental budget implications and assumptions included in the MTFP for 2024/25 to 2026/27; 2.16.4 New non-recurring strategic investment of £3.614m is proposed to deliver placed based investment and renewable energy investment. 2.16.5 The additional funding to the HSCP in 2024/25 represents the full allocation required from the settlement for the HSCP to meet new and existing spending commitments for those policy areas already distributed by Scottish Government. 2.16.6 The operational adjustments includes savings of £4.098m identified across Directorates for 2024/25. This is in addition to the £4.159m savings to be approved for member consideration to deliver a balance budget in 2024/25. 2.16.7 Proposed levels of fees and charges are outlined at Appendix 6. 2024/25 £m 2025/26 £m 2026/27 £m Council Tax Increase 0.00% 3.00% 3.00% SG Core Grant Movement -0.64% 0.00% 0.00% Operational Adjustments -£13.045m -£0.372m +£9.636m Previously Approved Savings +£0.590m -£0.020m - Expenditure Requirements (exc new funding and HSCP) +£28.912m +£9.423m +£6.273m Non-Recurring Strategic Investment +£3.614m +£1.386m -£5.000 HSCP Funding +£5.292m -£0.178m - Savings to be Approved -£4.159m -£1.164m -£0.373m 24
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3 Proposals That Council: a) notes the anticipated funding available to meet the Council’s expenditure requirements and notes the areas of ongoing financial risk to the Council; b) approves the Council's expenditure requirements for 2024/25 and notes the indicative requirements for 2025/26 and 2026/27; c) approves the new strategic investments outlined in section 2.7.3 of the report; d) notes the projected outturn position for 2023/24; e) notes the level of reserves and fund balances held by the Council and approves any use and contributions to and from these; f) approves the additional contribution to the HSCP noted at 2.8.1; g) approves efficiencies and savings to ensure a balanced budget for 2024/25, consequentials and new proposals in future years; h) approves the schedule of Council fees and charges detailed in Appendix 6; i) determines the level of Council Tax for 2024/25 and agrees to freeze Council tax at 2023/24 levels, noting the Scottish Government funding to support this, as set out in section 2.3; j) notes the anticipated funding gaps for 2025/26 and 2026/27; k) considers the equality and children’s rights impact of any proposed service changes; l) notes the feedback from the community Budget engagement exercise to help inform budget plans; m) notes progress to date on the Council’s Sustainable Change Programme and corporate Workforce Planning; and n) approves the budget matrix for 2024/25. 4 Implications / Socio-economic Duty Financial 4.1 The financial implications are as outlined in the report. Members require to approve a package of efficiencies and savings, excluding any decision taken by the IJB in respect of social care services, totalling £4.159m for 2024/25. The recommendations are based on a Council Tax freeze at 2023/24 levels and this is supported by additional Scottish Government funding. Any increase in net expenditure above that outlined in the draft budget will require to be funded. Failure to agree to the requirements outlined in the Scottish Government's grant offer as outlined at 2.2.7 and 2.2.8 may result in a less favourable settlement. These risks are outlined in the report. Human Resources 4.2 The total anticipated impact on the workforce is a net reduction of 114.5 FTE posts in 2024/25. The new savings proposals for 2024/25 results in a reduction of 63.5 FTE posts. The Council has a robust workforce planning framework in 25
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place. In line with this any reduction to the workforce will be management through natural attrition, vacancies, redeployment and voluntary early release. This will be effected by regular engagement and participation with the Trade Unions. Legal 4.3 The Council is obliged by the Local Government Finance Act 1992 to set a budget for 2024/25 and to do so in a manner and at such a time as to ensure that it is able lawfully to set its Council Tax by 11 March. Failure to do so could result in several legal and financial consequences, for both the Council and Members. Equality/Socio-economic 4.4 Obligation in respect of equalities are set out at 2.10 of the report. The Equality and Children’s Rights Impact Assessments (incorporating Fairer Scotland Duty and Island Proofing) and a summary of screenings are available via the link provided below. Full Impact Equality and Children's Rights Impact Assessments for Budget Proposals (sharepoint.com). Environmental and Sustainability 4.5 While setting of the budget has no direct environmental or sustainability impacts, there may be impacts on individual services. It is also recognised that the proposed new strategic investment for 2024/25 supports the Council’s sustainability agenda and would contribute towards achieving net zero. Key Priorities 4.6 The draft budget supports delivery of the outcomes as outlined in the new Council Plan 2023-2028. Community Wealth Building 4.7 Recommendations included in the report support investment for Community Wealth Building for consideration by Council. 5 Consultation 5.1 Significant scrutiny and challenge of the underlying assumptions of the proposed budget has taken place with the Executive Leadership Team and regular engagement with Elected Members has taken place between November 2023 and February 2024. 5.2 The key issues within this report have been presented to the Trade Unions. 26
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5.3 Community Budget engagement has been delivered through the launch of an on-line Budget Challenge tool between 24 October 2023 and 15 December 2023. An on-line Budget engagement session with community groups and associations took place on 30 January 2024. Full details of feedback has been issued to elected members. Mark Boyd Head of Service (Finance) For further information please contact Mark Boyd, Head of Service (Finance) on 01294-324560. Background Papers None 27
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Appendix 1 2024/25 Consequentials Rephased/New Total Consequentials Rephased/New Total £000's £000's £000's £000's £000's £000's £000's Funding Aggregate external finance 353,087 352,627 352,627 352,627 352,627 Additional aggregate external finance due : Teachers' Induction Scheme 734 734 734 734 734 Assumed Teachers' Superannuation Funding 2,116 2,116 2,116 2,116 2,116 Assumed CT Freeze Funding 3,453 3,453 3,453 3,453 3,453 Council Tax Income 64,483 66,840 66,840 69,282 69,282 Council Tax Income for Affordable Housing 1,198 1,235 1,235 1,271 1,271 NDR Empty Property Relief (2,803) (2,803) (2,803) (2,803) (2,803) Contribution from General Reserves 5,000 4,000 4,000 3,500 3,500 Total Funding Available 427,268 - 428,202 428,202 - 430,180 430,180 Expenditure Base Budget 406,064 427,268 427,268 428,202 428,202 Operational Budget Adjustments Inspiring Places (704) (517) (517) 70 70 Aspiring Communities (910) 410 410 - - A Council for the Future (11,431) (265) (265) 9,566 9,566 Total Operational Budget Adjustments (13,045) - (372) (372) - 9,636 9,636 Savings Previously Approved Inspiring Places 174 (20) (20) - - Aspiring Communities 344 - - - - A Council for the Future 72 - - - - Total Savings Previously Approved 590 - (20) (20) - - - Investments - Contractual/Unavoidable Inspiring Places 336 213 213 213 213 Aspiring Communities 2,529 - 511 511 - 1,142 1,142 Corporate Investment 24,433 - 7,419 7,419 - 4,655 4,655 Total Contractual / Unavoidable 27,298 - 8,143 8,143 - 6,010 6,010 Investments - National/Local Pressures Inspiring Places 498 - 468 468 - 121 121 Aspiring Communities 747 812 812 - 142 142 North Ayrshire Council Revenue Budget 2024/25 Revenue Budget Summary Position 2025/26 2026/27 28
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Appendix 1 2024/25 Consequentials Rephased/New Total Consequentials Rephased/New Total £000's £000's £000's £000's £000's £000's £000's North Ayrshire Council Revenue Budget 2024/25 Revenue Budget Summary Position 2025/26 2026/27 Total National / Local Pressures 1,245 - 1,280 1,280 - 263 263 New National Expenditure Requirements Aspiring Communities 364 - - - - - - A Council for the Future 5 - - - - - - Total National Expenditure Requirements 369 - - - - - - Total Expenditure Requirements (excl HSCP) 28,912 - 9,423 9,423 - 6,273 6,273 Health and Social Care Partnership HSCP Net Expenditure Requirements 1,755 - (178) (178) - - - New HSCP National Expenditure Requirements - Recurring 3,537 - . - - - - Total Health and Social Care Partnership 5,292 - (178) (178) - - - Total Expenditure Requirements 34,204 - 9,245 9,245 - 6,273 6,273 Additional Investment New Investment 3,614 (3,614) 5,000 1,386 (5,000) - (5,000) Total Adjustments 25,363 (3,614) 13,853 10,239 (5,000) 15,909 10,909 Total Expenditure Requirement 431,427 (3,614) 441,121 437,507 (5,000) 444,111 439,111 (Surplus)/Deficit for Year 4,159 (3,614) 12,919 9,305 (5,000) 13,931 8,931 New Savings Proposed Inspiring Places (1,342) (116) - (116) (163) - (163) Aspiring Communities (2,434) (848) - (848) - - - A Council for the Future (383) (200) - (200) (210) - (210) Total Savings Proposed (4,159) (1,164) - (1,164) (373) - (373) Revised Expenditure Requirement 427,268 4,778 441,121 436,343 5,373 444,111 438,738 Revised (Surplus)/Deficit for Year if all Savings Proposals are Accepted - (4,778) 12,919 8,141 (5,373) 13,931 8,558 Net Contribution to the HSCP Expenditure Requirements 20,303 6,283 6,283 6,131 6,131 Proposed Savings (15,011) (6,461) (6,461) (6,131) (6,131) Net Adjustments to the Contribution to the HSCP 5,292 (178) (178) - - 29
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Appendix 2 Council Objective/Theme Operational Budget Adjustment Reference Category 2024/25 2025/26 2026/27 £'s £'s £'s Inspiring Places Charging for Services, Alternative Funding Streetscene - Street Furniture. This would only be a one off as maintenance would be required in future years. SP-PL-24-03 Green (15,000) 15,000 Charging for Services, Alternative Funding Streetscene - Play Facilities. A one year reduction in the play facilities budget. Maintenance will be required in future years. SP-PL-24-04 Green (50,000) 50,000 Charging for Services, Alternative Funding Proposed income from solar PV farms. SP-PL-24-10 Green (255,369) (244,542) 11,933 Charging for Services, Alternative Funding Sub Total (320,369) (179,542) 11,933 Land, Property and Assets Commercial Estate Transformation - Maximise Rental Income from Existing and New Property SP-PL-24-01 Green (165,000) (85,000) (42,500) Land, Property and Assets Sub Total (165,000) (85,000) (42,500) Service Delivery Models Roads Restructure SP-PL-24-08 Green (45,000) - - Service Delivery Models Waste Review - Indexation on Waste Processing Contract Costs and income. SP-PL-24-13 Green (173,636) (252,035) 100,604 Service Delivery Models Sub Total (218,636) (252,035) 100,604 Total (704,005) (516,577) 70,037 Aspiring Communities Children, Young People and Communities One off savings in ELC due to the August opening of Montgomerie Park School. SP-COM-24-02 Green (160,381) 160,381 - Children, Young People and Communities Education turnover applied to non-teaching staff budgets to recognise the standard pattern of activity SP-COM-24-22 Green (750,000) 250,000 - Children, Young People and Communities Sub Total (910,381) 410,381 - Total (910,381) 410,381 - A Council for the Future Other Contribution to Affordable Housing Reserve Green 30,000 37,000 36,000 Other Workforce Planning - Voluntary Early Release Programme - Presented at Staffing and Recruitment Committee 20/11/23 Amber (2,483,773) - - Other Non Recurring Employers' Superannuation Rebate Green (9,228,000) (302,000) 9,530,000 Service Delivery Models Democratic Services Restructure BID-CEX-24-01 Green 250,718 - - Other Sub Total (11,431,055) (265,000) 9,566,000 Total (11,431,055) (265,000) 9,566,000 TOTAL OPERATIONAL BUDGET ADJUSTMENTS (13,045,441) (371,196) 9,636,037 North Ayrshire Council Revenue Budget 2024/25 Revenue Budget Operational Budget Adjustments 30
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Appendix 3 Category 2024/25 2025/26 2026/27 £'s £'s £'s Charging for Services, Alternative Funding Additional Building Warrant Income SP-PL-23-10 Green 125,000 - Charging for Services, Alternative Funding Sub Total - 125,000 - Land, Property and Assets Property Maintenance Budget review SP-PL-23-19 Amber 45,000 55,000 - Land, Property and Assets Play Facilities SP-PL-23-26 Green 50,000 - - Land, Property and Assets Office rationalisation (200,000) Land, Property and Assets Sub Total 95,000 (145,000) - Service Delivery Models Review of Roads Revenue Budget SP-PL-22-17 Amber (35,000) Service Delivery Models Review of income for temporary furnished accommodation SP-PL-22-08 Green 100,000 - Service Delivery Models Review of Key Holding Arrangements SP-PL-23-03 Green (36,270) - Service Delivery Models Increase Homeless service turnover targets SP-PL-23-07 Green 50,000 - Service Delivery Models Sub Total 78,730 - - Total 173,730 (20,000) - Children, Young People and Communities Review Early Learning and Childcare Staffing Entitlements SP-COM-23-02 (81,154) Children, Young People and Communities Closure of Kilwinning Early Years Centre SP-COM-23-04 (24,231) Children, Young People and Communities Review of Halls, Centres and Libraries SP-PL-22-04 Amber (103,424) - - Children, Young People and Communities Non-recurring Savings from Early Learning and Childcare SP-COM-23-05 Green 552,863 - Children, Young People and Communities Sub Total 344,054 - - Total 344,054 - - Service Delivery Models Review of Chief Exec Non Employee Budgets SP-CEX-23-01 Green 71,619 - - Service Delivery Models Sub Total 71,619 - - Total 71,619 - - North Ayrshire Council -589,403TOTAL SAVINGS PREVIOUSLY APPROVED Council Objective/Theme Saving Reference Revenue Budget Adjustments Previously Approved Revenue Budget 2024/25 Inspiring Places Aspiring Communities A Council for the Future (20,000) 31
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Appendix 4 2024/25 2025/26 2026/27 £'s £'s £'s Putting residents and communities at the heart of what we do Statutory Provision of Transport and Journeys Contractual/Unavoidable BID-PL-24-01 167,861 136,700 136,700 Sustainable Environment Service, Maintenance and Repair of Fleet Vehicles and Contractual/Unavoidable BID-PL-24-04 111,700 75,955 75,955 Well Connnected with Effective Infrastructure Procurement of road salt for the delivery of Winter Maintenance Service Contractual/Unavoidable BID-PL-24-11 56,243 - - Sub Total Contractual/Unavoidable 335,804 212,655 212,655 - - Sustainable Environment Carbon Reduction - The use of HVO as an alternative road fuel National/Local Pressures BID-PL-24-02 124,000 120,997 120,997 Sustainable Environment Property Maintenance Budget & Solar Photovoltaic Panels National/Local Pressures BID-PL-24-05/06 160,000 (30,000) - Sustainable Environment Ongoing Maintenance Costs for Shewalton Lanfill National/Local Pressures BID-PL-24-16 213,737 - - Sustainable Environment Managing Persistent Organic Pollutants with Waste Upholstered Domestic Seating National/Local Pressures BID-PL-24-17 - 377,365 - Sub Total National/Local Pressures 497,737 468,362 120,997 Total 833,541 681,017 333,652 Land, Property and Assets PPP/DBFM annual indexation Contractual/Unavoidable BID-COM-24-01 1,241,382 450,957 531,851 Children, Young People and Communities Classroom Assistants Shortfall Contractual/Unavoidable BID-COM-24-03a 956,256 - Children, Young People and Communities NALL Energy Costs Contractual/Unavoidable BID-COM-24-04 183,000 (15,000) 532,000 Children, Young People and Communities Food Inflation Contractual/Unavoidable BID-COM-24-06 75,492 - Transport & Travel SPT Annual Price Revision Contractual/Unavoidable BID-PL-23-05 73,226 75,423 77,685 Sub Total Contractual/Unavoidable 2,529,356 511,380 1,141,536 Children, Young People and Communities Islands Officer National/Local Pressures BID-PL-23-27 11,356 56,782 - Children, Young People and Communities Additional school running costs as a result of the capital programme National/Local Pressures BID-PL-21-01 & 23- 01 736,439 754,926 141,701 Sub Total National/Local Pressures 747,795 811,708 141,701 Children, Young People and Communities ELC Expansion New National Expenditure Requirements 212,000 - - Children, Young People and Communities Free School Meals Expansion New National Expenditure Requirements 148,000 - - Children, Young People and Communities Pupil Equity Fund New National Expenditure Requirements 10,000 - - Children, Young People and Communities Educational Psychologists New National Expenditure Requirements (3,000) - - Children, Young People and Communities Gaelic Education New National Expenditure Requirements (3,000) - - North Ayrshire Council Revenue Budget 2024/25 Revenue Expenditure Requirements Inspiring Places Aspiring Communities ReferenceCouncil Objective/Theme Investment Category 32
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Appendix 4 2024/25 2025/26 2026/27 £'s £'s £'s North Ayrshire Council Revenue Budget 2024/25 Revenue Expenditure Requirements ReferenceCouncil Objective/Theme Investment Category Sub Total New National Expenditure Requirements 364,000 - - Total 3,641,151 1,323,088 1,283,237 Other Barclay Review New National Expenditure Requirements 5,000 - - Sub Total New National Expenditure Requirements 5,000 - - Total 5,000 - - Inflation Joint Board requisitions Contractual/Unavoidable 80,495 105,754 108,926 Inflation Pay Award Contractual/Unavoidable 5,326,999 6,513,231 6,722,472 Inflation 22/23 - 23/24 SNCT Pay Award Contractual/Unavoidable 3,990,155 - - Inflation 23/24 SJC Pay Award Contractual/Unavoidable 4,510,958 - - Inflation Teachers' Employers' Superannuation Contractual/Unavoidable 2,115,630 73,031 71,442 Inflation NDR Revaluation Contractual/Unavoidable 71,712 10,148 - Inflation Corporate issues (energy, fuel, food, NDR) Contractual/Unavoidable 2,848,136 (323,050) 1,408,838 Sub Total 18,944,085 6,379,114 8,311,678 Other Loan charges Contractual/Unavoidable 5,488,010 1,040,302 (3,657,083) Sub Total 5,488,010 1,040,302 (3,657,083) Total 24,432,095 7,419,416 4,654,595 TOTAL REVENUE EXPENDITURE REQUIREMENTS 28,911,787 6,271,484 Council Wide Pressures A Council for the Future 9,423,521 33
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Appendix 5 £ £ £ £ £ £ Service Delivery Models SP-PL-24-02 Minor reduction in Roads Revenue Budget mitigated through continued significant levels of capital investment Low Negative Amber (100,000) - - - - - Service Delivery Models SP-PL-24-05 Streetscene - Removal of communities Christmas lights budget and funding for such activities would require to be considered from other funding sources. The remaining service would still provide one christmas tree with lighting per town. Low Negative Amber (38,000) - - - - - Service Delivery Models SP-PL-24-06 Waste Review - Review of operating times across Household Waste Recycling Centre (HWRC) sites Low Negative Amber (75,000) (2.00) - - - - Service Delivery Models SP-PL-24-07 Streetscene - Transition from summer bedding plants to perennials and funding for such activities to be considered from alternative funding sources None Green (24,500) - - - - - Service Delivery Models SP-PL-24-09 Waste - Cease issuing free food waste liners Low Negative Amber (29,250) - (9,750) - - - Charging for Services / Alternative Funding SP-PL-24-11 Waste Review - Introduce charging for garden waste collections. Current assessment of £50 annual charge which is in line with other local authorities. Low Negative Red (588,163) 1.00 (106,730) - (163,029) - Service Delivery Models SP-PL-24-12 Promote further biodiversity and wild flower areas across the school estate leading to a reduction in grass cutting areas. Low Positive Green (30,000) (1.00) - - - - Service Delivery Models SP-PL-24-15 Economic Development and Regeneration Budget Savings Low Negative Amber (340,000) (2.00) - - - - Service Delivery Models SP-PL-24-16 Review service - Gypsy Traveller Unauthorised Encampment sites Low Negative Amber (42,238) (1.00) - - - - Service Delivery Models SP-PL-24-17 Waste Review - Review collection frequency for Absorbant hygiene Products (AHP) based on current presentation rates from 2 weekly to 3 weekly to align with residual waste collection service. Low Negative Amber (75,000) (3.00) - - - - Total (1,342,151) (8.00) - (116,480) - (163,029) - Consequential Savings New Saving Consequential Savings Inspiring Places Aspiring Communities New Saving North Ayrshire Council Revenue Budget 2023/24 Revenue Budget Savings to be Approved Council Objective / Theme Savings Proposal Community Impact Community Impact 2023/24 2024/25 2025/26 Proposed Saving Workforce implications Reference 34
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Appendix 5 Consequential Savings New Saving Consequential Savings New Saving North Ayrshire Council Revenue Budget 2023/24 Revenue Budget Savings to be Approved Council Objective / Theme Savings Proposal Community Impact Community Impact 2023/24 2024/25 2025/26 Proposed Saving Workforce implications Reference Children, Young People and Communities SP-COM-24-01 Review staffing allocations to primary and secondary schools through the Devolved School Management scheme and in the context of a falling pupil roll and pupil teacher ratio guidance. None Amber (1,343,731) (35.00) (839,832) - - - Children, Young People and Communities SP-COM-24-03 Various Facilities Management procurement savings across several items linked to purchase volumes and commodity rationalisation None Green (135,963) - - - - - Children, Young People and Communities SP-COM-24-05 Reduction of cleaning days in offices aligned to current levels of footfall and cleaning within depots aligned to operational requirements None Amber (123,953) (5.14) - - - - Children, Young People and Communities SP-COM-24-06 Removal of School Crossing Patrollers currently allocated to roads with existing crossings. Low Negative Amber (30,000) (1.22) - - - - Children, Young People and Communities SP-COM-24-07/21 Review of Facilities Management posts across all areas of the service and a re-design of FM services. None Amber (128,590) (1.00) (8,500) - - - Children, Young People and Communities SP-COM-24- 08/11/16/17 Reduction of libraries opening hours by 20% and review all supplies and operational budgets. The proposal also includes a re-designed school library service. Low Negative Amber (438,437) (9.50) - - - - Children, Young People and Communities SP-COM-24-09 Cessation of evening lets in some secondary schools and re-direction of lets into other council buildings. Low Negative Green (14,000) (0.50) - - - - Children, Young People and Communities SP-COM-24-10 Reduction of venue assistant core hours Low Negative Green (28,000) (1.00) - - - - Children, Young People and Communities SP-COM-24-12/13/18/19 Re-design of the Community Learning and Development service and a reduction in sessional budgets, non-payroll budgets and and a re-design of CLD resourcing Low Negative Amber (145,846) (1.00) - - - - Children, Young People and Communities SP-COM-24-14 Phase 1 of a review of administrative support in Communities and Education None Green (38,559) (1.00) - - - - Children, Young People and Communities SP-COM-24-20 Remove Arts Participatory Budgeting fund Low Negative Amber (7,000) - - - - - Total (2,434,079) (55.36) - (848,332) - - - 35
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Appendix 5 Consequential Savings New Saving Consequential Savings New Saving North Ayrshire Council Revenue Budget 2023/24 Revenue Budget Savings to be Approved Council Objective / Theme Savings Proposal Community Impact Community Impact 2023/24 2024/25 2025/26 Proposed Saving Workforce implications Reference Other SP-CEX-24-01 ICT - Reduction in non employee budgets. None Green (123,000) - - Other SP-CEX-24-02 Financial Services - Further Review of all non- essential spend budgets Low Negative Green (70,000) - - Other 5% Increase in Council Fees and Charges (Excluding School Meals Charges) Low Negative Amber (189,378) - (199,974) (209,973) Total (382,378) - - (199,974) - (209,973) - A Council for the Future (373,002) -TOTAL SAVINGS TO BE APPROVED (4,158,608) (63.36) (1,164,786) - 36
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North Ayshire Council Fees & Charges for 2024-25 to 2026-27 Directorate Service Manager Charge Description Charge Type Current Approved Charge excluding VAT (2023/24) £ Proposed Charge (2024/25) Indicative Charge (2025/26) Indicative Charge (2026/27) Basis of increase 2024/25 % Basis of increase 2025/26 % Basis of increase 2026/27 % Note CONTRIBUTION FEES & CHARGES Chief Executives Legal - Licensing Raymond Lynch General - Amendment (1982 Act Para 9 - if due to Licence Partnership) Contribution £132.00 £139.00 £146.00 £153.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch General - Amendment of Licence (1982 Act Para 9 consent to Material Change - if not Licence Partnership) Contribution £37.00 £39.00 £41.00 £43.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch Entertainment - Indoor Sports Entertainment Licence (when another NAC Licence is held) Contribution £180.00 £189.00 £198.00 £208.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch Entertainment - Indoor Sports Entertainment Licence (when no other NAC Licences are held) Contribution £358.00 £376.00 £395.00 £415.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch Entertainment - Public Entertainment Licence (Commercial Premises with Fairground) Contribution £418.00 £439.00 £461.00 £484.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch Entertainment - Public Entertainment Licence - Full Licence (maximum duration of 3 years, and renewable) Contribution £382.00 £401.00 £421.00 £442.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch Entertainment - Public Entertainment Licence - Temporary Licence (maximum duration of 6 weeks, and not renewable) Contribution £339.00 £356.00 £374.00 £393.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch Animal Activity Licence - to sell pets (Activity A) Contribution £209.00 £219.00 £230.00 £242.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch Animal Activity Licence - to rehome animals (Activity B) Contribution £209.00 £219.00 £230.00 £242.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch Animal Activity Licence - To operate an "Animal welfare Establishment" (Activity C) If licence holder is OSCR registered no fee Contribution £0.00 £0.00 £0.00 £0.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch Animal Activity Licence - To operate an "Animal welfare Establishment" (Activity C) If not OSCR registered Contribution £209.00 £219.00 £230.00 £242.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch Animal Activity Licence - to breed puppies (Activity D) Grant (one year renewable) Contribution £501.00 £526.00 £552.00 £580.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch Animal Activity Licence - to breed puppies (Activity D) Renewal (one year) Contribution £221.00 £232.00 £244.00 £256.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch Animal Activity Licence - to breed kittens (Activity E) Grant (one year renewable) Contribution £501.00 £526.00 £552.00 £580.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch Animal Activity Licence - to breed kittens (Activity E) Renewal (one year) Contribution £221.00 £232.00 £244.00 £256.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch Animal Activity Licence - to breed rabbits (Activity F) Grant (one year renewable) Contribution £501.00 £526.00 £552.00 £580.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch Animal Activity Licence - to breed rabbits (Activity F) Renewal (one year) Contribution £221.00 £232.00 £244.00 £256.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch Animal Boarding Licence (1 to 10 Animals) Contribution £89.00 £93.00 £98.00 £103.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch Animal Boarding Licence (11 to 20 Animals) Contribution £119.00 £125.00 £131.00 £138.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch Animal Boarding Licence (21 to 30 Animals) Contribution £155.00 £163.00 £171.00 £180.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch Animal Boarding Licence (31 to 50 Animals) Contribution £227.00 £238.00 £250.00 £263.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch Animal Boarding Licence (51 to 70 Animals) Contribution £292.00 £307.00 £322.00 £338.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch Animal Boarding Licence (Over 70 Animals) Contribution £370.00 £389.00 £408.00 £428.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch Animal - Registration - Performing Animals (Regulation) Act 1925 Contribution £53.00 £56.00 £59.00 £62.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch Booking Office (with public access) Contribution £358.00 £376.00 £395.00 £415.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch Booking Office (without public access) Contribution £239.00 £251.00 £264.00 £277.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch Caravan Sites New system (relevant Permanenet sites - Residential sites) / Old system (Holiday and touring sites) - no fee Contribution £679.00 £713.00 £749.00 £786.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch Cinema Licence - grant or renewal for one year Contribution £292.00 £307.00 £322.00 £338.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch Cinema Licence - grant or renewal for under a year - per month (total not to exceed the one year fee) Contribution £98.00 £103.00 £108.00 £113.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch Cinema Licence - Transfer Contribution £59.00 £62.00 £65.00 £68.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch Animal - Dangerous Wild Animals - New & Renewal (maximum duration of 12 months, and renewable) Contribution £316.00 £332.00 £349.00 £366.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch General - Duplicate Licence Contribution £37.00 £39.00 £41.00 £43.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch Dealer - Knife Dealers Licence - New & Renewal (Full - maximum duration of 3 years, and renewable) Contribution £358.00 £376.00 £395.00 £415.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch Other CGSA - Late Hours Catering Licence - New & Renewal (Full - maximum duration of 3 years, and renewable) Contribution £190.00 £200.00 £210.00 £221.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch Other CGSA - Market Operators Licence Contribution £405.00 £425.00 £446.00 £468.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch Dealer - Metal Dealers Licence (Premises & Itinerant) Contribution £125.00 £131.00 £138.00 £145.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch Poisons - Registration to sell non medical poisons (new) Contribution £26.00 £27.00 £28.00 £29.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch Poisons - Registration to sell non medical poisons (retention) Contribution £14.00 £15.00 £16.00 £17.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch Dealer - Second Hand Dealers Licence - New (Full - maximum duration of 3 years, and renewable) Contribution £251.00 £264.00 £277.00 £291.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch Dealer - Second Hand Dealers Licence - Already Licenced (Full - maximum duration of 3 years, and renewable) Contribution £132.00 £139.00 £146.00 £153.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch Other CGSA - Sex Shop or Sexual Entertainment Venue Licence - New & Renewal (Full - maximum duration of 3 years, and renewable) Contribution £2,128.00 £2,234.00 £2,346.00 £2,463.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch Other CGSA - Skin Piercing or Tattooing Licence (with Premises) Contribution £376.00 £395.00 £415.00 £436.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch Other CGSA - Skin Piercing or Tattooing Licence (without Premises) Contribution £316.00 £332.00 £349.00 £366.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch Street Trader Employee Licence - Full licence (maximum duration of 3 years, and renewable) Contribution £143.00 £150.00 £158.00 £166.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch Street Trader Employee Licence - Temporary Licence (maximum duration of 3 years, and renewable) Contribution £108.00 £113.00 £119.00 £125.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch Street Trader Operator - Substitute Vehicle Contribution £125.00 £131.00 £138.00 £145.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch Street Trader Operator Licence - Full Licence (maximum duration of 3 years, and renewable) Contribution £287.00 £301.00 £316.00 £332.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch Street Trader Operator Licence - Temporary Licence (maximum duration of 6 weeks, and not renewable) Contribution £196.00 £206.00 £216.00 £227.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch Animal - Zoo Licence (New - maximum duration of 4 years, and renewable. Vet inspections are charged in additiion) Contribution £316.00 £332.00 £349.00 £366.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch Animal - Zoo Licence (Renewal - maximum duration of 6 years, and renewable. Vet inspections are charged in additiion) Contribution £316.00 £332.00 £349.00 £366.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch Animal - Venison Dealer Contribution £132.00 £139.00 £146.00 £153.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch Animal - Venison Employee / Agent Contribution £71.00 £75.00 £79.00 £83.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch Animal - Game Dealers Contribution £5.00 £5.00 £5.00 £5.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch Poisons - Registration (alteration of details in Register) Contribution £6.00 £6.00 £6.00 £6.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch STL - Grant - Secondary Letting - 1 to 4 Guests Contribution £250.00 £263.00 £276.00 £290.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch STL - Grant - Secondary Letting - 5 or more guests Contribution £400.00 £420.00 £441.00 £463.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch STL - Grant - Home Sharing and/or Home Letting - 1 to 4 Guests Contribution £125.00 £131.00 £138.00 £145.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch STL - Grant - Home Sharing and/or Home Letting - 5 or more Guests Contribution £200.00 £210.00 £221.00 £232.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch STL - Renewal/Recurring Fee - Secondary Letting - 1 to 4 Guests Contribution £200.00 £210.00 £221.00 £232.00 5.0% 5.0% 5.0% Appendix 6 37
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Directorate Service Manager Charge Description Charge Type Current Approved Charge excluding VAT (2023/24) £ Proposed Charge (2024/25) Indicative Charge (2025/26) Indicative Charge (2026/27) Basis of increase 2024/25 % Basis of increase 2025/26 % Basis of increase 2026/27 % Note Chief Executives Legal - Licensing Raymond Lynch STL - Renewal/Recurring Fee - Secondary Letting - 5 or more Guests Contribution £350.00 £368.00 £386.00 £405.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch STL - Renewal/Recurring Fee - Home Sharing and/or Home Letting - 1 to 4 Guests Contribution £100.00 £105.00 £110.00 £116.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch STL - Renewal/Recurring Fee - Home Sharing and/or Home Letting - 5 or more Guests Contribution £175.00 £184.00 £193.00 £203.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch Animal - Riding Establishment Licence (1 year, New & Renewal) Contribution £501.00 £526.00 £552.00 £580.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch Animal - Riding Establishment Licence (One year, If already licenced) Contribution £376.00 £395.00 £415.00 £436.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch TPHC Other - Replacement Door Sign Contribution £18.00 £19.00 £20.00 £21.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch TPHC Other - Replacement Licence resulting from change of address Contribution £15.00 £16.00 £17.00 £18.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch TPHC Other - Replacement Plate Contribution £36.00 £38.00 £40.00 £42.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch TPHC Other - Replacement Tariff Card Contribution £15.00 £16.00 £17.00 £18.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch TPHC Other - Replacement Taxi / Private Hire Car Driver Badge Contribution £20.00 £21.00 £22.00 £23.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch TPHC Other - Replacement Window Stickers Contribution £20.00 £21.00 £22.00 £23.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch TPHC Other - Substitution of Vehicle (Taxi or Private Hire Car) Contribution £223.00 £234.00 £246.00 £258.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch TPHC Licences - Taxi Driver's Licence - Full Licence (1 year, and renewable) Contribution £89.00 £93.00 £98.00 £103.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch TPHC Licences - Taxi Driver's Licence - Full Licence (maximum duration of 3 years, and renewable) Contribution £209.00 £219.00 £230.00 £242.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch TPHC Licences - Private Hire Car Driver Licence - Full licence (maximum duration of 3 years, and renewable) Contribution £209.00 £219.00 £230.00 £242.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch TPHC Licences - Private Hire Car Licence (Operator) - Full Licence (1 year, and renewable) Contribution £370.00 £389.00 £408.00 £428.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch TPHC Licences - Private Hire Car Licence (Operator) - Full Licence (maximum duration of 3 years, and renewable) Contribution £620.00 £651.00 £684.00 £718.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch TPHC Licences - Taxi Licence (1 year) Contribution £400.00 £420.00 £441.00 £463.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch TPHC Licences - Taxi Licence (Operator) - Full Licence (maximum duration of 3 years, and renewable) Contribution £691.00 £726.00 £762.00 £800.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch General - Variation of a Licence Contribution £61.00 £64.00 £67.00 £70.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch TPHC Licences - Private Hire Car Driver's Licence - Full Licence (1 yr, and renewable) Contribution £89.00 £93.00 £98.00 £103.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch TPHC Other - Inspection of Vehicle (Taxi or Private Hire Car) Contribution £92.00 £97.00 £102.00 £107.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch TPHC Other - Re-inspection of Vehicle (Taxi or Private Hire Car) Contribution £49.00 £51.00 £54.00 £57.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch TPHC Other - Re-seal of Taximeter Contribution £24.00 £25.00 £26.00 £27.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch General - Civic Government (Scotland) Act 1982 - Temporary Licence (duration specified in Licence, maximum 6 weeks, and not renewable) (unless specifically mentioned in this table) Contribution £180.00 £189.00 £198.00 £208.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch House in Multiple Occupation Licence (New) Contribution £1,002.00 £1,052.00 £1,105.00 £1,160.00 5.0% 5.0% 5.0% Chief Executives Legal - Licensing Raymond Lynch House in Multiple Occupation Licence (Already Licenced) Contribution £752.00 £790.00 £830.00 £872.00 5.0% 5.0% 5.0% Chief Executives Registration Services Elaine Nixon Civil Marriages / Partnerships at Registration Office outwith office hours Contribution £504.65 £522.13 £548.24 £575.65 5.0% 5.0% 5.0% Chief Executives Registration Services Elaine Nixon Civil Marriages / Partnerships at Registration Office during office hours Contribution £315.65 £323.68 £339.86 £356.85 5.0% 5.0% 5.0% Chief Executives Registration Services Elaine Nixon All Ceremonies at approved venues - fee for attendance of a Registrar during office hours Contribution £491.00 £507.80 £533.19 £559.85 5.0% 5.0% 5.0% Chief Executives Registration Services Elaine Nixon All Ceremonies at approved venues - fee for attendance of a Registrar outwith office hours Contribution £552.95 £572.85 £601.49 £631.56 5.0% 5.0% 5.0% Chief Executives Registration Services Elaine Nixon Guest Supplement: during office hours when more than 4 guests attend a marriage/civil partnership at Registration offices Contribution £160.65 £168.68 £177.11 £185.97 5.0% 5.0% 5.0% Chief Executives Registration Services Elaine Nixon Naming & Renewal of Vows Ceremonies conducted at Registration Offices during office hours Contribution £304.50 £319.73 £335.72 £352.51 5.0% 5.0% 5.0% Chief Executives Registration Services Elaine Nixon Naming & Renewal of Vows Ceremonies conducted at Registration Offices outwith office hours Contribution £365.40 £383.67 £402.85 £422.99 5.0% 5.0% 5.0% Chief Executives Registration Services Elaine Nixon Civil Marriage/Partnership & Naming Ceremony booked together and conducted at Registration Offices outwith office hours Contribution £649.55 £674.28 £707.99 £743.39 5.0% 5.0% 5.0% Chief Executives Registration Services Elaine Nixon Civil Marriage/Partnership & Naming Ceremony booked together and conducted at Approved Venues outwith office hours Contribution £723.05 £751.45 £789.02 £828.47 5.0% 5.0% 5.0% Chief Executives Registration Services Elaine Nixon Civil Marriage/Partnership & Naming Ceremony booked together and conducted at Approved Venues during office hours Contribution £631.70 £655.54 £688.32 £722.74 5.0% 5.0% 5.0% Chief Executives Registration Services Elaine Nixon Guest supplement: during office hours when more than 4 guests attend a Civil Marriage/Partnership & Naming Ceremony at Registration Offices Contribution £413.70 £434.39 £456.11 £478.92 5.0% 5.0% 5.0% Chief Executives Registration Services Elaine Nixon Private Citizenship Ceremony, Registration Office, Office Hours Contribution £145.95 £153.25 £160.91 £168.96 5.0% 5.0% 5.0% Chief Executives Registration Services Elaine Nixon Private Citizenship Ceremony, Registration Office, Office Hours, plus Guest Supplement for more than 4 Guests Contribution £267.75 £281.14 £295.20 £309.96 5.0% 5.0% 5.0% Chief Executives Registration Services Elaine Nixon Civil Marriage/Partnership & Naming Ceremony booked together and conducted at Registration Offices during office hours Contribution £568.70 £589.39 £618.86 £649.80 5.0% 5.0% 5.0% Health & Social Care All Eleanor Currie Maximum Weekly Non-Residential Charge Contribution £96.60 £106.26 £111.57 £117.15 10.0% 5.0% 5.0% Health & Social Care Adults Eleanor Currie Care at Home Adults Contribution £16.79 £18.47 £19.39 £20.36 10.0% 5.0% 5.0% Health & Social Care Adults Eleanor Currie Day Care (purchased and provided) Contribution £14.99 £16.49 £17.31 £18.18 10.0% 5.0% 5.0% Health & Social Care Adults Eleanor Currie Day Care (charges to Other Las) Contribution £243.11 £267.42 £280.79 £294.83 10.0% 5.0% 5.0% Health & Social Care Adults and Older People Eleanor Currie Guest Room Charges at Sheltered Housing Accommodations Contribution £5.51 £6.06 £6.36 £6.68 10.0% 5.0% 5.0% Health & Social Care Adults and Older People Eleanor Currie Community Alarms service - mainland Contribution £5.32 £5.85 £6.14 £6.45 10.0% 5.0% 5.0% Health & Social Care Adults and Older People Eleanor Currie Community Alarms service - Arran Contribution £2.60 £2.86 £3.00 £3.15 10.0% 5.0% 5.0% Health & Social Care Adults and Older People Eleanor Currie Meals on Wheels Contribution £3.36 £3.70 £3.89 £4.08 10.0% 5.0% 5.0% Health & Social Care Older People Eleanor Currie Care at Home Older People per hour Contribution £16.79 £18.47 £19.39 £20.36 10.0% 5.0% 5.0% Health & Social Care Older People Eleanor Currie Day Care (purchased and provided) Older People Contribution £14.99 £16.49 £17.31 £18.18 10.0% 5.0% 5.0% Health & Social Care Adults Eleanor Currie Respite (for an individual's care need rather than to give the carer a break) Age 16-24 Contribution £69.56 £76.52 £80.35 £84.37 10.0% 5.0% 5.0% This charge depends on the 24/25 Personal Allowance rate which will not be known until early March. Health & Social Care Adults Eleanor Currie Respite (for an individual's care need rather than to give the carer a break) Age 25 - 64 Contribution £86.63 £95.29 £100.05 £105.05 10.0% 5.0% 5.0% This charge depends on the 24/25 Personal Allowance rate which will not be known until early March. Health & Social Care Older People Eleanor Currie Respite (for an individual's care need rather than to give the carer a break) Age 65+ Contribution £159.18 £175.10 £183.86 £193.05 10.0% 5.0% 5.0% This charge depends on the 24/25 Personal Allowance rate which will not be known until early March. Health & Social Care Adults Eleanor Currie Sleepover Contribution £13.18 £14.50 £15.23 £15.99 10.0% 5.0% 5.0% Health & Social Care Adults and Older People Eleanor Currie Trindlemoss House - permanent placement Contribution £1,134.00 £1,190.70 £1,250.24 £1,312.75 5.0% 5.0% 5.0% Health & Social Care Adults and Older People Eleanor Currie Montrose House - permanent residential placement Contribution £1,134.00 £1,190.70 £1,250.24 £1,312.75 5.0% 5.0% 5.0% Health & Social Care Adults and Older People Eleanor Currie Montrose House - permanent nursing placement Contribution £1,312.50 £1,378.13 £1,447.04 £1,519.39 5.0% 5.0% 5.0% Health & Social Care Adults and Older People Eleanor Currie Sleepover Contribution £13.18 £14.50 £15.23 £15.99 10.0% 5.0% 5.0% Health & Social Care Adults and Older People Eleanor Currie Direct Payments - Personal Assistants Contribution £14.02 £15.42 £16.19 £17.00 10.0% 5.0% 5.0% Health & Social Care Adults and Older People Eleanor Currie Direct Payments - Agency Rates Contribution £16.79 £18.47 £19.39 £20.36 10.0% 5.0% 5.0% Appendix 6 38
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Directorate Service Manager Charge Description Charge Type Current Approved Charge excluding VAT (2023/24) £ Proposed Charge (2024/25) Indicative Charge (2025/26) Indicative Charge (2026/27) Basis of increase 2024/25 % Basis of increase 2025/26 % Basis of increase 2026/27 % Note Health & Social Care Adults and Older People Eleanor Currie Direct Payments - Sleepovers Contribution £13.08 £14.39 £15.11 £15.87 10.0% 5.0% 5.0% Communities & Housing Connected Communities (Community Facilities) Donna Morrison Hire of table linen Contribution £6.50 £6.85 £7.20 £7.55 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Community Facilities) Donna Morrison Hire of twinkle curtain Contribution £82.10 £86.20 £90.50 £95.05 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Community Facilities) Donna Morrison Hire of Red Carpet Contribution £40.75 £42.80 £44.95 £47.20 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Community Facilities) Donna Morrison Store Requests, hires and deliveries Contribution £35.10 £36.85 £38.70 £40.65 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Community Facilities) Donna Morrison Stores hire of tables go pack Contribution £6.05 £6.35 £6.65 £7.00 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Community Facilities) Donna Morrison Stores hire of tables round Contribution £11.70 £12.30 £12.90 £13.55 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Community Facilities) Donna Morrison Party Package Civic Centre Contribution £143.50 £150.67 £158.20 £166.11 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Community Facilities) Donna Morrison Wedding packages - Ceremony and Reception Contribution £902.42 £947.54 £994.92 £1,044.67 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Community Facilities) Donna Morrison Wedding packages - Reception only Contribution £647.33 £679.71 £713.70 £749.39 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Arran Outdoor) Angela Morrell Holidays 3 days/2 nights (4 people) Contribution £622.00 £653.00 £686.00 £720.00 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Arran Outdoor) Angela Morrell Holidays 5 days/4 nights (4 people) Contribution £1,235.00 £1,297.00 £1,362.00 £1,430.00 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Arran Outdoor) Angela Morrell Bed and breakfast (adult) Contribution £43.00 £45.00 £47.00 £49.00 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Arran Outdoor) Angela Morrell Dinner, bed and breakfast (adult) Contribution £55.00 £58.00 £61.00 £64.00 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Arran Outdoor) Angela Morrell Half day activity (adult) Contribution £56.00 £59.00 £62.00 £65.00 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Arran Outdoor) Angela Morrell Half day activity (child) Contribution £39.00 £41.00 £43.00 £45.00 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Arran Outdoor) Angela Morrell Full day activity (adult) Contribution £111.00 £117.00 £123.00 £129.00 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Arran Outdoor) Angela Morrell Full day activity (child) Contribution £78.00 £82.00 £86.00 £90.00 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Arran Outdoor) Angela Morrell Room hire Commercial large classroom Contribution £39.00 £41.00 £43.00 £45.00 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Arran Outdoor) Angela Morrell Room hire Family Function large classroom Contribution £23.00 £24.00 £25.00 £26.00 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Arran Outdoor) Angela Morrell Room hire NAC large classroom Contribution £21.00 £22.00 £23.00 £24.00 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Arran Outdoor) Angela Morrell Room hire general meeting large classroom Contribution £13.00 £14.00 £15.00 £16.00 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Arran Outdoor) Angela Morrell Room hire Childcare large classroom Contribution £7.00 £7.00 £7.00 £7.00 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Arran Outdoor) Angela Morrell Room hire Disabled/charity large classroom Contribution £5.00 £5.00 £5.00 £5.00 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Arran Outdoor) Angela Morrell Room hire Commercial small chartroom Contribution £20.00 £21.00 £22.00 £23.00 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Arran Outdoor) Angela Morrell Room hire Family Function small chartroom Contribution £12.00 £13.00 £14.00 £15.00 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Arran Outdoor) Angela Morrell Room hire NAC small chartroom Contribution £11.00 £12.00 £13.00 £14.00 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Arran Outdoor) Angela Morrell Room hire genral meeting small chartroom Contribution £6.00 £6.00 £6.00 £6.00 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Arran Outdoor) Angela Morrell Room hire Childcare small chartroom Contribution £3.00 £3.00 £3.00 £3.00 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Arran Outdoor) Angela Morrell Room hire Disabled/charity small chartroom Contribution £2.00 £2.00 £2.00 £2.00 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Arran Outdoor) Angela Morrell Instructor day rate Contribution £231.00 £243.00 £255.00 £268.00 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Arran Outdoor) Angela Morrell NAC School Group 5 days/4 nights (per person) Contribution £218.00 £229.00 £240.00 £252.00 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Arran Outdoor) Angela Morrell NAC School Group 5 days/4 nights (per person) Accompanying Staff Contribution £109.00 £114.00 £120.00 £126.00 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Arran Outdoor) Angela Morrell Other school Group 5 days/4 nights (per person) Contribution £439.00 £461.00 £484.00 £508.00 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Arran Outdoor) Angela Morrell Other school Group 5 days/4 nights (per person) Accompanying staff Contribution £219.00 £230.00 £242.00 £254.00 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Arran Outdoor) Angela Morrell Other school Group 4 days/3 nights (per person) Contribution £175.00 £184.00 £193.00 £203.00 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Arran Outdoor) Angela Morrell Other school Group 4 days/3 nights (per person) Accompanying staff Contribution £88.00 £92.00 £97.00 £102.00 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Arran Outdoor) Angela Morrell NAC School Group 3 days/2 nights (per person) Contribution £116.00 £122.00 £128.00 £134.00 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Arran Outdoor) Angela Morrell NAC School Group 3 days/2 nights (per person) Accompanying staff Contribution £58.00 £61.00 £64.00 £67.00 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Arran Outdoor) Angela Morrell Other school Group 3 days/2 nights (per person) Contribution £231.00 £243.00 £255.00 £268.00 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Arran Outdoor) Angela Morrell Other school Group 3 days/2 nights (per person) accompanying staff Contribution £116.00 £122.00 £128.00 £134.00 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Arts) Lesley Forsyth Studio 1 - Commercial Contribution £27.00 £28.00 £29.00 £30.00 5.0% 5.0% 5.0% Appendix 6 39
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Directorate Service Manager Charge Description Charge Type Current Approved Charge excluding VAT (2023/24) £ Proposed Charge (2024/25) Indicative Charge (2025/26) Indicative Charge (2026/27) Basis of increase 2024/25 % Basis of increase 2025/26 % Basis of increase 2026/27 % Note Communities & Housing Connected Communities (Arts) Lesley Forsyth Studio 1 - Non-Commercial Contribution £19.00 £20.00 £21.00 £22.00 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Arts) Lesley Forsyth Studio 2 - Commercial Contribution £20.00 £21.00 £22.00 £23.00 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Arts) Lesley Forsyth Studio 2 - Non-Commercial Contribution £8.00 £8.00 £8.00 £8.00 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Arts) Lesley Forsyth Theatre Hire - Commercial Contribution £75.00 £79.00 £83.00 £87.00 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Arts) Lesley Forsyth Theatre Hire - Non-Commercial Contribution £44.00 £46.00 £48.00 £50.00 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Community Facilities) Donna Morrison Hall lets, Letting Commission and School Letting - Category 1 user (eg Commercial Activities) - SMALL ROOM Contribution £22.50 £23.65 £24.85 £26.10 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Community Facilities) Donna Morrison Hall lets, Letting Commission and School Letting - Category 1 user (eg Commercial Activities) - LARGE ROOM Contribution £45.40 £47.65 £50.05 £52.55 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Community Facilities) Donna Morrison Hall lets, Letting Commission and School Letting - Category 2 user (eg Family Functions) - SMALL ROOM Contribution £13.30 £13.95 £14.65 £15.40 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Community Facilities) Donna Morrison Hall lets, Letting Commission and School Letting - Category 2 user (eg Family Functions) - LARGE ROOM Contribution £26.60 £27.95 £29.35 £30.80 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Community Facilities) Donna Morrison Hall lets, Letting Commission and School Letting - Category 3 user (eg Agency Letting) - SMALL ROOM Contribution £7.35 £7.70 £8.10 £8.50 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Community Facilities) Donna Morrison Hall lets, Letting Commission and School Letting - Category 3 user (eg Agency Letting) - LARGE ROOM Contribution £14.70 £15.45 £16.20 £17.00 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Community Facilities) Donna Morrison Hall lets, Letting Commission and School Letting - Category 4 user (eg Pre 5 groups) - SMALL ROOM Contribution £3.30 £3.45 £3.60 £3.80 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Community Facilities) Donna Morrison Hall lets, Letting Commission and School Letting - Category 4 user (eg Pre 5 groups) - LARGE ROOM Contribution £6.45 £6.75 £7.10 £7.45 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Community Facilities) Donna Morrison Hall lets, Letting Commission and School Letting - Category 5 user (eg Disabled org's) - SMALL ROOM Contribution £3.25 £3.45 £3.60 £3.80 6.2% 5.0% 5.0% Communities & Housing Connected Communities (Community Facilities) Donna Morrison Hall lets, Letting Commission and School Letting - Category 5 user (eg Disabled Org's) - LARGE ROOM Contribution £6.40 £6.75 £7.10 £7.45 5.7% 5.0% 5.0% Communities & Housing Connected Communities (Community Facilities) Donna Morrison Astro Pitch Youth Contribution £15.10 £15.85 £16.65 £17.50 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Community Facilities) Donna Morrison Astro Pitch Adult Contribution £22.70 £23.85 £25.05 £26.30 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Community Facilities) Donna Morrison Stores hire Chairs (per item charge) Contribution £1.20 £1.25 £1.30 £1.35 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Community Facilities) Donna Morrison Hire of additional chair covers (STH Weddings) Contribution £2.90 £3.05 £3.20 £3.35 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Country Parks) Lesley Forsyth Campsite Contribution £10.00 £11.00 £12.00 £13.00 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Country Parks) Lesley Forsyth Events Fields Contribution £117.00 £123.00 £129.00 £135.00 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Country Parks) Lesley Forsyth Campsite Field Contribution £70.00 £74.00 £78.00 £82.00 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Country Parks) Lesley Forsyth Visitor Facility Block - Full Day Contribution £79.00 £83.00 £87.00 £91.00 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Country Parks) Lesley Forsyth Visitor Facility Block - Half Day Contribution £39.50 £41.50 £43.50 £45.50 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Country Parks) Lesley Forsyth Portacabin Toilets Contribution £20.00 £21.00 £22.00 £23.00 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Country Parks) Lesley Forsyth Ranger Service - All Other Groups Contribution £32.00 £34.00 £36.00 £38.00 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Country Parks) Lesley Forsyth Racquet Hall - NAC Group / School Contribution £14.70 £15.50 £16.50 £17.50 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Country Parks) Lesley Forsyth Racquet Hall - Non Commercial Contribution £26.60 £28.00 £29.50 £31.00 5.0% 5.0% 5.0% Communities & Housing Connected Communities (Country Parks) Lesley Forsyth Racquet Hall - Commercial Contribution £45.50 £48.00 £50.50 £53.00 5.0% 5.0% 5.0% Communities & Housing Planning Services Allan Finlayson Planning Search fees Contribution £106.05 £111.35 £116.92 £122.77 5.0% 5.0% 5.0% Communities & Housing Planning Services Allan Finlayson Section 50 Certificates Contribution £131.25 £137.81 £144.70 £151.94 5.0% 5.0% 5.0% Communities & Housing Planning Services Allan Finlayson Press Adverts Arran Contribution £76.67 £80.50 £84.53 £88.76 5.0% 5.0% 5.0% Communities & Housing Planning Services Allan Finlayson Press Adverts Mainland Contribution £169.17 £177.63 £186.51 £195.84 5.0% 5.0% 5.0% Place Economic Growth (Transportation) Claire Fitzsimmons Construction Consent Amendments Contribution £383.25 £402.41 £422.53 £443.66 5.0% 5.0% 5.0% Place Economic Growth (Transportation) Claire Fitzsimmons Supply of Traffic Count data Contribution £210.89 £221.43 £232.50 £244.13 5.0% 5.0% 5.0% Communities & Housing Heritage Lesley Forsyth Genealogy research hourly charge. Any additional costs incurred as a result of the work e.g Scotland People Vouchers, printing etc to be charged at cost Contribution £20.00 £21.00 £22.00 £23.00 5.0% 5.0% 5.0% Communities & Housing Libraries Lesley Forsyth Magnifying Sheets Contribution £2.10 £2.50 £2.50 £2.50 5.0% 5.0% 5.0% Communities & Housing Libraries Lesley Forsyth Tea/Coffee Contribution £1.30 £1.50 £1.50 £1.50 5.0% 5.0% 5.0% Communities & Housing Libraries Lesley Forsyth Street Plans Contribution £3.00 £3.00 £3.00 £3.00 5.0% 5.0% 5.0% Communities & Housing Libraries Lesley Forsyth DVD Lending Service - DVD's per Week hire Contribution £1.80 £2.00 £2.00 £2.00 5.0% 5.0% 5.0% Communities & Housing Libraries Lesley Forsyth DVD Lending Service - Day ones (New releases) 2 nights hire Contribution £2.10 £2.50 £2.50 £2.50 5.0% 5.0% 5.0% Communities & Housing Libraries Lesley Forsyth Audio Charges - CD Contribution £0.30 £0.50 £0.50 £0.50 5.0% 5.0% 5.0% Communities & Housing Libraries Lesley Forsyth Room Hire - Category 1 user (eg Commercial Activities) - SMALL ROOM Contribution £22.50 £23.65 £24.85 £26.10 5.0% 5.0% 5.0% Communities & Housing Libraries Lesley Forsyth Room Hire - Category 2 user (eg Family Functions) - SMALL ROOM Contribution £13.30 £13.95 £14.65 £15.40 5.0% 5.0% 5.0% Communities & Housing Libraries Lesley Forsyth Room Hire - Category 3 user (eg Agency Letting) - SMALL ROOM Contribution £7.35 £7.70 £8.10 £8.50 5.0% 5.0% 5.0% Communities & Housing Libraries Lesley Forsyth Room Hire - Category 4 user (eg Pre 5 groups) - SMALL ROOM Contribution £3.30 £3.45 £3.60 £3.80 5.0% 5.0% 5.0% Communities & Housing Libraries Lesley Forsyth Room Hire - Category 5 user (eg Disabled org's) - SMALL ROOM Contribution £3.25 £3.45 £3.60 £3.80 6.2% 5.0% 5.0% Place Energy and Sustainablility Jennifer Wraith Electric Vehicle Charging Point - Destination/Kwh Contribution £0.19 £0.31 £0.33 £0.35 63.2% 5.0% 5.0% Place Energy and Sustainablility Jennifer Wraith Electric Vehicle Charging Point - Journey/Kwh Contribution £0.30 £0.37 £0.39 £0.41 23.3% 5.0% 5.0% Place Energy and Sustainablility Jennifer Wraith Overstay Flat Fee Contribution £10.00 £30.00 £32.00 £34.00 200.0% 5.0% 5.0% Appendix 6 40
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Directorate Service Manager Charge Description Charge Type Current Approved Charge excluding VAT (2023/24) £ Proposed Charge (2024/25) Indicative Charge (2025/26) Indicative Charge (2026/27) Basis of increase 2024/25 % Basis of increase 2025/26 % Basis of increase 2026/27 % Note Communities & Housing Protective Services (Building Standards) Scott McKenzie Clearance Certificates Contribution £246.86 £259.20 £272.16 £285.77 5.0% 5.0% 5.0% Communities & Housing Protective Services (Building Standards) Scott McKenzie Searches Contribution £106.05 £111.35 £116.92 £122.77 5.0% 5.0% 5.0% Communities & Housing Protective Services (Building Standards) Scott McKenzie Section 50 Certificates Contribution £131.25 £137.81 £144.70 £151.94 5.0% 5.0% 5.0% Communities & Housing Protective Services (Building Standards) Scott McKenzie Section 89 Certificates Contribution £429.24 £450.70 £473.24 £496.90 5.0% 5.0% 5.0% Communities & Housing Protective Services (Environmental Health) Scott McKenzie Bacteriological Swimming Pool Sampling Contribution £53.55 £56.23 £59.04 £61.99 5.0% 5.0% 5.0% Communities & Housing Protective Services (Environmental Health) Scott McKenzie Legionelia Swimming Pool Sampling Contribution £99.75 £104.74 £109.98 £115.48 5.0% 5.0% 5.0% Communities & Housing Protective Services (Environmental Health) Scott McKenzie Food Hygiene Training Delegate Charge Contribution £30.45 £31.97 £33.57 £35.25 5.0% 5.0% 5.0% Communities & Housing Protective Services (Environmental Health) Scott McKenzie Chemical Swimming Pool Sampling Contribution £73.50 £77.18 £81.04 £85.09 5.0% 5.0% 5.0% Communities & Housing Protective Services (Environmental Health) Scott McKenzie Support Attestation Contribution £100.00 £105.00 £110.25 £115.76 5.0% 5.0% 5.0% Communities & Housing Protective Services (Environmental Health) Scott McKenzie Pest Control - Fumigations/Sprays for heavy infestations e.g. bedbugs, fleas includes survey and revisit. Contribution £80.90 £84.90 £89.10 £93.60 5.0% 5.0% 5.0% Communities & Housing Protective Services (Environmental Health) Scott McKenzie Pest Control Charge - Insects (Domestic) Contribution £52.50 £55.10 £57.90 £60.80 5.0% 5.0% 5.0% Communities & Housing Protective Services (Environmental Health) Scott McKenzie Pest Control Charge - Rats/Mice/Insects (Commercial) Contribution £80.90 £84.90 £89.10 £93.60 5.0% 5.0% 5.0% Communities & Housing Protective Services (Environmental Health) Scott McKenzie Pest Control Charge - Rats/Mice/Squirrels (Domestic) includes up to 3 visits. Contribution £80.90 £84.90 £89.10 £93.60 5.0% 5.0% 5.0% Communities & Housing Protective Services (Environmental Health) Scott McKenzie Pest Control Charge - Wasp Nests/Bees Contribution £52.50 £55.10 £57.90 £60.80 5.0% 5.0% 5.0% Communities & Housing Protective Services (Environmental Health) Scott McKenzie Section 50 Certificates Contribution £131.25 £137.81 £144.70 £151.94 5.0% 5.0% 5.0% Communities & Housing Protective Services (Environmental Health) Scott McKenzie Certificate of Compliance (not required as part of licence application) Contribution £105.00 £110.25 £115.76 £121.55 5.0% 5.0% 5.0% Communities & Housing Protective Services (Environmental Health) Scott McKenzie Health Certificate for export to China Contribution £37.80 £39.69 £41.67 £43.75 5.0% 5.0% 5.0% Communities & Housing Protective Services (Trading Standards) Scott McKenzie Liquid fuel measuring instruments - first meter tested Contribution £166.95 £175.30 £184.07 £193.27 5.0% 5.0% 5.0% Communities & Housing Protective Services (Trading Standards) Scott McKenzie Liquid fuel measuring instruments - each additional meter tested during same visit Contribution £102.90 £108.05 £113.45 £119.12 5.0% 5.0% 5.0% Communities & Housing Protective Services (Trading Standards) Scott McKenzie All other weighing and measuring equipment - one officer on site (per hour) Contribution £90.30 £94.82 £99.56 £104.54 5.0% 5.0% 5.0% Communities & Housing Protective Services (Trading Standards) Scott McKenzie All other weighing and measuring equipment - two or more officers on site (per hour) Contribution £144.90 £152.15 £159.76 £167.75 5.0% 5.0% 5.0% Place Bereavement Service Wallace Turpie/ David Mackay Interment of Eighteen and Over Contribution £846.00 £888.00 £932.00 £979.00 5.0% 5.0% 5.0% Place Bereavement Service Wallace Turpie/ David Mackay Purchase of Exclusive Right of Burial (New Lair) Contribution £902.00 £947.00 £994.00 £1,044.00 5.0% 5.0% 5.0% Place Bereavement Service Wallace Turpie/ David Mackay Purchase of Exclusive Right of Burial (Woodland Area) Contribution £902.00 £947.00 £994.00 £1,044.00 5.0% 5.0% 5.0% Place Bereavement Service Wallace Turpie/ David Mackay Interment of Cremated Remains (Aged 18 and over) Contribution £239.00 £251.00 £264.00 £277.00 5.0% 5.0% 5.0% Place Bereavement Service Wallace Turpie/ David Mackay Memorial Foundation Contribution £185.00 £194.00 £204.00 £214.00 5.0% 5.0% 5.0% Place Bereavement Service Wallace Turpie/ David Mackay Dis-interments Contribution £1,019.00 £1,070.00 £1,124.00 £1,180.00 5.0% 5.0% 5.0% Place Bereavement Service Wallace Turpie/ David Mackay Interment in common ground Contribution £265.00 £278.00 £292.00 £307.00 5.0% 5.0% 5.0% Place Bereavement Service Wallace Turpie/ David Mackay Purchase of Exclusive Right of Burial - Cremated Remains Only (New Lair) Contribution £495.00 £520.00 £546.00 £573.00 5.0% 5.0% 5.0% Place Bereavement Service Wallace Turpie/ David Mackay Purchase of Exclusive Right of Burial - Cremated Remains Only in Garden of Remembrance (New Lair) Contribution £495.00 £520.00 £546.00 £573.00 5.0% 5.0% 5.0% Place Bereavement Service Wallace Turpie/ David Mackay Interment of Eighteen and Over (Saturdays and Public Holidays) Contribution £1,269.00 £1,332.00 £1,399.00 £1,469.00 5.0% 5.0% 5.0% Place Bereavement Service Wallace Turpie/ David Mackay Transfer of Title Deeds/Duplicate Title Deeds Contribution £22.00 £23.00 £24.00 £25.00 5.0% 5.0% 5.0% Place Bereavement Service Wallace Turpie/ David Mackay Memorial permit Contribution £46.00 £48.00 £50.00 £53.00 5.0% 5.0% 5.0% School Meals FM Carolyn Hope Secondary School meals Contribution £2.05 £2.05 £2.05 £2.05 0.0% 0.0% 0.0% School Meals FM Carolyn Hope Primary School meals Contribution £2.05 £2.05 £2.05 £2.05 0.0% 0.0% 0.0% Place Largs Car Park Wallace Turpie/ David Mackay Car park Charges - up to 1 hour Largs Car Park £0.83 £0.83 £0.83 £0.83 0.0% 0.0% 0.0% Place Largs Car Park Wallace Turpie/ David Mackay Car park Charges - over 1 hour up to 3 hours Largs Car Park £2.50 £2.50 £2.50 £2.50 0.0% 0.0% 0.0% Place Largs Car Park Wallace Turpie/ David Mackay Car park Charges - over 3 hours Largs Car Park £4.17 £4.17 £4.17 £4.17 0.0% 0.0% 0.0% Place Largs Car Park Wallace Turpie/ David Mackay Gallowgate Public Toilets Charge Largs Car Park £0.33 £0.33 £0.33 £0.33 0.0% 0.0% 0.0% Place Streetscene Services Wallace Turpie/ David Mackay Abandoned Trolley Charge Contribution £33.00 £35.00 £37.00 £39.00 5.0% 5.0% 5.0% Place Streetscene Services Wallace Turpie/ David Mackay Grass Cutting Scheme Contribution £74.00 £78.00 £82.00 £86.00 5.0% 5.0% 5.0% Place Streetscene Services Wallace Turpie/ David Mackay Fly posting removal - varies by poster size. Minimum charge of £30 per poster Contribution £30.00 £32.00 £34.00 £36.00 5.0% 5.0% 5.0% Appendix 6 41
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Directorate Service Manager Charge Description Charge Type Current Approved Charge excluding VAT (2023/24) £ Proposed Charge (2024/25) Indicative Charge (2025/26) Indicative Charge (2026/27) Basis of increase 2024/25 % Basis of increase 2025/26 % Basis of increase 2026/27 % Note Place Streetscene Services Wallace Turpie/ David Mackay Dog Fouling clean up charge Contribution £30.00 £32.00 £34.00 £36.00 5.0% 5.0% 5.0% Place Streetscene Services Wallace Turpie/ David Mackay Fly tipping clean up charges - varies by quantity. Minimum charge of £114.06 Contribution £114.06 £120.00 £126.00 £132.00 5.0% 5.0% 5.0% Place Streetscene Services Wallace Turpie/ David Mackay Landfill charge per tonne Contribution £140.00 £147.00 £154.00 £162.00 5.0% 5.0% 5.0% Place Streetscene Services Wallace Turpie/ David Mackay Mis-use of public bin. Minimum service charge of £114.06 Contribution £114.06 £120.00 £126.00 £132.00 5.0% 5.0% 5.0% Place Streetscene Services Wallace Turpie/ David Mackay Disposal of Waste within Caravans per tonne Contribution £140.00 £147.00 £154.00 £162.00 5.0% 5.0% 5.0% Place Transport Services Gordon Mitchell Tachograph Calibration Contribution £60.90 £63.95 £67.15 £70.51 5.0% 5.0% 5.0% Place Transport Services Gordon Mitchell Tachograph 2 year Inspection Contribution £42.00 £44.10 £46.31 £48.63 5.0% 5.0% 5.0% Place Transport Services Gordon Mitchell Tachograph 6 year Inspection Contribution £60.90 £63.95 £67.15 £70.51 5.0% 5.0% 5.0% Place Transport Services Gordon Mitchell CPC Training Contribution £70.00 £73.50 £77.18 £81.04 5.0% 5.0% 5.0% Place Transport Services Gordon Mitchell Per hire charge for transport hires to external groups. Contribution £24.15 £25.36 £26.63 £27.96 5.0% 5.0% 5.0% Place Roads Susan Macfadyen Section 56 Roads Opening Permit Vehicle Access Crossing Contribution £78.00 £82.00 £86.00 £90.00 5.0% 5.0% 5.0% Place Roads Susan Macfadyen Section 56 Road Opening Permit Other works involving excavation in the public road Contribution £218.00 £229.00 £240.00 £252.00 5.0% 5.0% 5.0% Place Roads Susan Macfadyen Section 56 Road Opening Permit Other works involving excavation in the public road. Duration charge for additional week. Contribution £103.00 £108.00 £113.00 £119.00 5.0% 5.0% 5.0% Place Roads Susan Macfadyen Section 58 Road Occupation Permits Builders Materials - for up to 4 weeks Contribution £90.00 £95.00 £100.00 £105.00 5.0% 5.0% 5.0% Place Roads Susan Macfadyen Section 58 Road Occupation Permits Cranes - for up to 4 weeks Contribution £90.00 £95.00 £100.00 £105.00 5.0% 5.0% 5.0% Place Roads Susan Macfadyen Section 58 Road Occupation Permits Scaffolding - for up to 4 weeks Contribution £90.00 £95.00 £100.00 £105.00 5.0% 5.0% 5.0% Place Roads Susan Macfadyen Section 85 Skip Permits - for up to 4 weeks Contribution £54.00 £57.00 £60.00 £63.00 5.0% 5.0% 5.0% Place Roads Susan Macfadyen Temporary Traffic Signal Permit (three way or more only). This would be in addition to Section 56 charge. Contribution £128.00 £134.00 £141.00 £148.00 5.0% 5.0% 5.0% Place Roads Susan Macfadyen Temporary Traffic Signal Permit (three way or more only). This would be in addition to Section 56 charge. Duration charge for additional week. Contribution £128.00 £134.00 £141.00 £148.00 5.0% 5.0% 5.0% Place Roads Susan Macfadyen Property Enquiry Adoption Plan Contribution £39.00 £41.00 £43.00 £45.00 5.0% 5.0% 5.0% Place Roads Susan Macfadyen NRSWA Section 109 Permission Contribution £333.00 £350.00 £368.00 £386.00 5.0% 5.0% 5.0% Place Roads Susan Macfadyen 5 day Temporary Traffic Order (by notice) Contribution £447.00 £469.00 £492.00 £517.00 5.0% 5.0% 5.0% Place Roads Susan Macfadyen Emergency Temporary Traffic Order (by notice) Contribution £447.00 £469.00 £492.00 £517.00 5.0% 5.0% 5.0% Place Roads Susan Macfadyen Temporary Traffic Orders (advertised in press). Advertising costs are extra. Contribution £691.00 £726.00 £762.00 £800.00 5.0% 5.0% 5.0% Place Roads Susan Macfadyen Supply of Traffic Count Data. Price per site. Contribution £218.00 £229.00 £240.00 £252.00 5.0% 5.0% 5.0% Place Roads Susan Macfadyen Supply / Use of information from the Saturn and ParamicsTraffic Models Contribution £1,407.00 £1,477.00 £1,551.00 £1,629.00 5.0% 5.0% 5.0% Place Roads Susan Macfadyen Neighbourhood Watch Signs Contribution £39.00 £41.00 £43.00 £45.00 5.0% 5.0% 5.0% Place Roads Susan Macfadyen Switching off Traffic Signals for third parties Contribution £154.00 £162.00 £170.00 £179.00 5.0% 5.0% 5.0% Place Roads Susan Macfadyen Temporary signs for events. Contribution £103.00 £108.00 £113.00 £119.00 5.0% 5.0% 5.0% Place Roads Susan Macfadyen Signs for new Housing Developments Contribution £397.00 £417.00 £438.00 £460.00 5.0% 5.0% 5.0% Place Roads Susan Macfadyen H Bar Markings (Access protection markings) Contribution £64.00 £67.00 £70.00 £74.00 5.0% 5.0% 5.0% Place Roads Susan Macfadyen Amenity display licence Contribution £29.00 £30.00 £32.00 £34.00 5.0% 5.0% 5.0% Place Roads Susan Macfadyen Car Park Charges (Bellmans Close) - Up to 60 minutes Contribution £1.25 £1.25 £1.25 £1.25 0.0% 0.0% 0.0% Place Roads Susan Macfadyen Car Park Charges (Bellmans Close) - Up to 120 minutes Contribution £1.67 £1.67 £1.67 £1.67 0.0% 0.0% 0.0% Place Roads Susan Macfadyen Car Park Charges (Bellmans Close) - Up to 240 minutes Contribution £2.92 £2.92 £2.92 £2.92 0.0% 0.0% 0.0% Place Roads Susan Macfadyen Penalty Charge Notice Contribution £100.00 £100.00 £100.00 £100.00 0.0% 0.0% 0.0% Place Roads Susan Macfadyen Penalty Charge Notice if paid within 14 days Contribution £50.00 £50.00 £50.00 £50.00 0.0% 0.0% 0.0% Place Roads Susan Macfadyen Charge certificate served and where PCN remains unpaid after day 56 Contribution £150.00 £150.00 £150.00 £150.00 0.0% 0.0% 0.0% Place Waste Resources David Mackay Collection and Disposal of Commercial White Goods per item Contribution £157.63 £165.51 £173.79 £182.48 5.0% 5.0% 5.0% Place Waste Resources David Mackay Bin Repair - standard lock supply & fitting Contribution £23.85 £25.04 £26.29 £27.60 5.0% 5.0% 5.0% Place Waste Resources David Mackay Bin Repair - new forest lock lock supply & fitting Contribution £34.65 £36.38 £38.20 £40.11 5.0% 5.0% 5.0% Place Waste Resources David Mackay Bin Repair - push to lock supply & fitting Contribution £48.13 £50.54 £53.07 £55.72 5.0% 5.0% 5.0% Place Waste Resources David Mackay Bin Repair - lid supplied & lock fixed cost Contribution £148.42 £155.84 £163.63 £171.81 5.0% 5.0% 5.0% Place Waste Resources David Mackay Bin Repair - Push to lock lid and lock supply & fitting Contribution £172.70 £181.34 £190.41 £199.93 5.0% 5.0% 5.0% Place Waste Resources David Mackay Bin Repair - one front wheel supplied and fitted cost Contribution £77.55 £81.43 £85.50 £89.78 5.0% 5.0% 5.0% Place Waste Resources David Mackay Bin Repair - one back wheel supplied and fitted cost Contribution £84.00 £88.20 £92.61 £97.24 5.0% 5.0% 5.0% Place Waste Resources David Mackay Special Uplift Charges Contribution £26.46 £27.78 £29.17 £30.63 5.0% 5.0% 5.0% Place Waste Resources David Mackay Special Uplift individual item Charges Contribution £5.29 £5.55 £5.83 £6.12 5.0% 5.0% 5.0% Place Waste Resources David Mackay Commercial Refuse Scheduled Bin Uplift Residual Waste Service 240 Litre Bin Contribution £6.10 £6.41 £6.73 £7.07 5.0% 5.0% 5.0% Place Waste Resources David Mackay Commercial Refuse Scheduled Bin Uplift Residual Waste Service 360 Litre Bin Contribution £9.16 £9.62 £10.10 £10.61 5.0% 5.0% 5.0% Place Waste Resources David Mackay Commercial Refuse Scheduled Bin Uplift Residual Waste Service 660 Litre Bin Contribution £16.77 £17.61 £18.49 £19.41 5.0% 5.0% 5.0% Place Waste Resources David Mackay Commercial Refuse Scheduled Bin Uplift Residual Waste Service 1100 Litre Bin Contribution £27.97 £29.37 £30.84 £32.38 5.0% 5.0% 5.0% Place Waste Resources David Mackay Commercial Refuse Scheduled Bin Uplift Residual Waste Service 1280 Litre Bin Contribution £32.62 £34.25 £35.96 £37.76 5.0% 5.0% 5.0% Place Waste Resources David Mackay Sub-Contracted Commercial Collection Residual Waste 240 Litre bin Contribution £6.58 £6.91 £7.26 £7.62 5.0% 5.0% 5.0% Place Waste Resources David Mackay Sub-Contracted Commercial Collection Residual Waste 360 Litre bin Contribution £9.88 £10.37 £10.89 £11.43 5.0% 5.0% 5.0% Place Waste Resources David Mackay Sub-Contracted Commercial Collection Residual Waste 660 Litre bin Contribution £18.09 £18.99 £19.94 £20.94 5.0% 5.0% 5.0% Place Waste Resources David Mackay Sub-Contracted Commercial Collection Residual Waste 1100 Litre bin Contribution £30.19 £31.70 £33.29 £34.95 5.0% 5.0% 5.0% Place Waste Resources David Mackay Sub-Contracted Commercial Collection Residual Waste 1280 Litre bin Contribution £35.22 £36.98 £38.83 £40.77 5.0% 5.0% 5.0% Place Waste Resources David Mackay Commercial Refuse Scheduled Bin Uplift Food/Organic 140 Litre Bin Contribution £5.10 £5.36 £5.63 £5.91 5.0% 5.0% 5.0% Place Waste Resources David Mackay Commercial Refuse Scheduled Bin Uplift Garden Waste 240 Litre Bin Contribution £8.75 £9.19 £9.65 £10.13 5.0% 5.0% 5.0% Place Waste Resources David Mackay Commercial Refuse Scheduled Bin Uplift Food/Organic 500 Litre Bin Contribution £18.25 £19.16 £20.12 £21.13 5.0% 5.0% 5.0% Place Waste Resources David Mackay Sub-Contracted Commercial Collection Mixed Recyclate 240 Litre bin Contribution £5.09 £5.34 £5.61 £5.89 5.0% 5.0% 5.0% Place Waste Resources David Mackay Sub-Contracted Charity Mixed Recycling Waste 140 Litre bin Contribution £1.91 £2.01 £2.11 £2.22 5.0% 5.0% 5.0% Place Waste Resources David Mackay Subcontractor Commercial Refuse Scheduled Bin Uplift Food/Organic 140 Litre Bin Contribution £6.48 £6.80 £7.14 £7.50 5.0% 5.0% 5.0% Place Waste Resources David Mackay Subcontractor Commercial Refuse Scheduled Bin Uplift Garden Waste 240 Litre Bin Contribution £11.11 £11.67 £12.25 £12.86 5.0% 5.0% 5.0% Place Waste Resources David Mackay Subcontractor Commercial Refuse Scheduled Bin Uplift Food/Organic 500 Litre Bin Contribution £23.11 £24.27 £25.48 £26.75 5.0% 5.0% 5.0% Place Waste Resources David Mackay Charity Refuse Scheduled Bin Uplift Residual Waste Service 240 Litre Bin Contribution £3.06 £3.21 £3.37 £3.54 5.0% 5.0% 5.0% Place Waste Resources David Mackay Charity Refuse Scheduled Bin Uplift Residual Waste Service 360 Litre Bin Contribution £4.59 £4.82 £5.06 £5.31 5.0% 5.0% 5.0% Place Waste Resources David Mackay Charity Refuse Scheduled Bin Uplift Residual Waste Service 660 Litre Bin Contribution £8.39 £8.81 £9.25 £9.71 5.0% 5.0% 5.0% Place Waste Resources David Mackay Charity Refuse Scheduled Bin Uplift Residual Waste Service 1100 Litre Bin Contribution £13.98 £14.68 £15.41 £16.18 5.0% 5.0% 5.0% Place Waste Resources David Mackay Charity Refuse Scheduled Bin Uplift Residual Waste Service 1280 Litre Bin Contribution £16.31 £17.13 £17.99 £18.89 5.0% 5.0% 5.0% Place Waste Resources David Mackay Charity Scheduled Bin Uplift Mixed Recyclate Service 140 Litre Bin Contribution £1.38 £1.45 £1.52 £1.60 5.0% 5.0% 5.0% Place Waste Resources David Mackay Charity Scheduled Bin Uplift Mixed Recyclate Service 240 Litre Bin Contribution £2.36 £2.48 £2.60 £2.73 5.0% 5.0% 5.0% Place Waste Resources David Mackay Charity Scheduled Bin Uplift Mixed Recyclate Service 360 Litre Bin Contribution £3.53 £3.71 £3.90 £4.10 5.0% 5.0% 5.0% Place Waste Resources David Mackay Charity Scheduled Bin Uplift Mixed Recyclate Service 660 Litre Bin Contribution £6.49 £6.81 £7.15 £7.51 5.0% 5.0% 5.0% Place Waste Resources David Mackay Charity Scheduled Bin Uplift Mixed Recyclate Service 1100 Litre Bin Contribution £10.80 £11.34 £11.91 £12.51 5.0% 5.0% 5.0% Appendix 6 42
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Directorate Service Manager Charge Description Charge Type Current Approved Charge excluding VAT (2023/24) £ Proposed Charge (2024/25) Indicative Charge (2025/26) Indicative Charge (2026/27) Basis of increase 2024/25 % Basis of increase 2025/26 % Basis of increase 2026/27 % Note Place Waste Resources David Mackay Charity Scheduled Bin Uplift Mixed Recyclate Service 1280 Litre Bin Contribution £12.56 £13.19 £13.85 £14.54 5.0% 5.0% 5.0% Place Waste Resources David Mackay Charity Scheduled Bin Uplift Food/Organic 140 Litre Bin Contribution £2.56 £2.69 £2.82 £2.96 5.0% 5.0% 5.0% Place Waste Resources David Mackay Charity Scheduled Bin Uplift Garden Waste 240 Litre Bin Contribution £4.39 £4.61 £4.84 £5.08 5.0% 5.0% 5.0% Place Waste Resources David Mackay Charity Scheduled Bin Uplift Food/Organic 500 Litre Bin Contribution £9.11 £9.57 £10.05 £10.55 5.0% 5.0% 5.0% Place Waste Resources David Mackay Commercial Refuse Scheduled Bin Uplift Mixed Recyclate Service 140 Litre Bin Contribution £2.74 £2.88 £3.02 £3.17 5.0% 5.0% 5.0% Place Waste Resources David Mackay Commercial Refuse Scheduled Bin Uplift Mixed Recyclate Service 240 Litre Bin Contribution £4.70 £4.94 £5.19 £5.45 5.0% 5.0% 5.0% Place Waste Resources David Mackay Commercial Refuse Scheduled Bin Uplift Mixed Recyclate Service 360 Litre Bin Contribution £7.08 £7.43 £7.80 £8.19 5.0% 5.0% 5.0% Place Waste Resources David Mackay Commercial Refuse Scheduled Bin Uplift Mixed Recyclate Service 660 Litre Bin Contribution £12.96 £13.61 £14.29 £15.00 5.0% 5.0% 5.0% Place Waste Resources David Mackay Commercial Refuse Scheduled Bin Uplift Mixed Recyclate Service 1100 Litre Bin Contribution £21.60 £22.68 £23.81 £25.00 5.0% 5.0% 5.0% Place Waste Resources David Mackay Commercial Refuse Scheduled Bin Uplift Mixed Recyclate Service 1280 Litre Bin Contribution £25.13 £26.39 £27.71 £29.10 5.0% 5.0% 5.0% Place Waste Resources David Mackay Sub-Contracted Commercial Collection Residual Waste 140 Litre bin Contribution £3.86 £4.05 £4.25 £4.46 5.0% 5.0% 5.0% Place Waste Resources David Mackay Charity Refuse Scheduled Bin Uplift Residual Waste Service 140 Litre Bin Contribution £1.77 £1.86 £1.95 £2.05 5.0% 5.0% 5.0% Place Waste Resources David Mackay Sub-Contracted Charity Residual Waste 140 Litre bin Contribution £1.93 £2.03 £2.13 £2.24 5.0% 5.0% 5.0% Place Waste Resources David Mackay Subcontractor Charity Commercial Collection Garden Waste 240 Litre bin Contribution £5.57 £5.85 £6.14 £6.45 5.0% 5.0% 5.0% Place Waste Resources David Mackay Commercial Refuse Scheduled Bin Uplift Residual Waste Service 140 Litre Bin Contribution £3.56 £3.74 £3.93 £4.13 5.0% 5.0% 5.0% Place Waste Resources David Mackay Sub contract Sack Sales Pre-Paid - Trade Recycling per 100 Contribution £140.86 £147.90 £155.30 £163.07 5.0% 5.0% 5.0% Place Waste Resources David Mackay Sub contract Sack Sales Pre-Paid - Trade Waste per 50 Contribution £139.71 £146.70 £154.04 £161.74 5.0% 5.0% 5.0% Place Waste Resources David Mackay Sub-Contracted Charity Residual Waste 240 Litre bin Contribution £3.30 £3.47 £3.64 £3.82 5.0% 5.0% 5.0% Place Waste Resources David Mackay Sub-Contracted Charity Residual Waste 360 Litre bin Contribution £4.94 £5.19 £5.45 £5.72 5.0% 5.0% 5.0% Place Waste Resources David Mackay Sub-Contracted Charity Residual Waste 660 Litre bin Contribution £9.05 £9.50 £9.98 £10.48 5.0% 5.0% 5.0% Place Waste Resources David Mackay Sub-Contracted Charity Residual Waste 1100 Litre bin Contribution £15.09 £15.84 £16.63 £17.46 5.0% 5.0% 5.0% Place Waste Resources David Mackay Sub-Contracted Charity Residual Waste 1280 Litre bin Contribution £17.61 £18.49 £19.41 £20.38 5.0% 5.0% 5.0% Place Waste Resources David Mackay Sub-Contracted Charity Mixed Recycling Waste 240 Litre bin Contribution £2.56 £2.69 £2.82 £2.96 5.0% 5.0% 5.0% Place Waste Resources David Mackay Sub-Contracted Charity Mixed Recycling Waste 360 Litre bin Contribution £3.82 £4.01 £4.21 £4.42 5.0% 5.0% 5.0% Place Waste Resources David Mackay Sub-Contracted Charity Mixed Recycling Waste 660 Litre bin Contribution £6.99 £7.34 £7.71 £8.10 5.0% 5.0% 5.0% Place Waste Resources David Mackay Sub-Contracted Charity Mixed Recycling Waste 1100 Litre bin Contribution £11.66 £12.24 £12.85 £13.49 5.0% 5.0% 5.0% Place Waste Resources David Mackay Sub-Contracted Charity Mixed Recycling Waste 1280 Litre bin Contribution £13.57 £14.25 £14.96 £15.71 5.0% 5.0% 5.0% Place Waste Resources David Mackay Sub-Contracted Charity Food/Organic Waste 140 Litre bin Contribution £3.24 £3.40 £3.57 £3.75 5.0% 5.0% 5.0% Place Waste Resources David Mackay Sub-Contracted Charity Food/Organic Waste 500 Litre bin Contribution £11.55 £12.13 £12.74 £13.38 5.0% 5.0% 5.0% Place Waste Resources David Mackay Sub-Contracted Commercial Collection Mixed Recyclate 140 Litre bin Contribution £3.06 £3.21 £3.37 £3.54 5.0% 5.0% 5.0% Place Waste Resources David Mackay Sub-Contracted Commercial Collection Mixed Recyclate 240 Litre bin Contribution £5.09 £5.34 £5.61 £5.89 5.0% 5.0% 5.0% Place Waste Resources David Mackay Sub-Contracted Commercial Collection Mixed Recyclate 360 Litre bin Contribution £7.63 £8.01 £8.41 £8.83 5.0% 5.0% 5.0% Place Waste Resources David Mackay Sub-Contracted Commercial Collection Mixed Recyclate 660 Litre bin Contribution £13.98 £14.68 £15.41 £16.18 5.0% 5.0% 5.0% Place Waste Resources David Mackay Sub-Contracted Commercial Collection Mixed Recyclate 1100 Litre bin Contribution £23.32 £24.49 £25.71 £27.00 5.0% 5.0% 5.0% Place Waste Resources David Mackay Sub-Contracted Commercial Collection Mixed Recyclate 1280 Litre bin Contribution £27.10 £28.46 £29.88 £31.37 5.0% 5.0% 5.0% Place Waste Resources David Mackay Event container delivery & uplift Contribution £72.93 £76.58 £80.41 £84.43 5.0% 5.0% 5.0% Place Waste Resources David Mackay Contamination charge - 140/240/360 ltr bins Contribution £18.24 £19.15 £20.11 £21.12 5.0% 5.0% 5.0% Place Waste Resources David Mackay Contamination charge - 500/660/1100/1280 ltr bins Contribution £42.55 £44.68 £46.91 £49.26 5.0% 5.0% 5.0% Place Waste Resources David Mackay Container retrieval - 140/240/360 ltr bins Contribution £18.24 £19.15 £20.11 £21.12 5.0% 5.0% 5.0% Place Waste Resources David Mackay Container retrieval - 500/660/1100/1280 ltr bins Contribution £42.55 £44.68 £46.91 £49.26 5.0% 5.0% 5.0% Place Waste Resources David Mackay Arran Yellow Tip Permit Contribution £61.61 £64.69 £67.92 £71.32 5.0% 5.0% 5.0% Place Waste Resources David Mackay Arran Blue Tip Permit Contribution £102.60 £107.73 £113.12 £118.78 5.0% 5.0% 5.0% Place Waste Resources David Mackay Green - Treatment per Te Contribution £60.78 £63.82 £67.01 £70.36 5.0% 5.0% 5.0% Place Waste Resources David Mackay Soil - Treatment per Te Contribution £36.47 £38.29 £40.20 £42.21 5.0% 5.0% 5.0% Place Waste Resources David Mackay Scrap - Treatment per Te Contribution £36.47 £38.29 £40.20 £42.21 5.0% 5.0% 5.0% Place Waste Resources David Mackay Paper & Cardboard - Treatment per Te Contribution £36.47 £38.29 £40.20 £42.21 5.0% 5.0% 5.0% Place Waste Resources David Mackay Wood - Treatment per Te Contribution £36.47 £38.29 £40.20 £42.21 5.0% 5.0% 5.0% Place Waste Resources David Mackay Plastics - Treatment per Te Contribution £60.78 £63.82 £67.01 £70.36 5.0% 5.0% 5.0% Place Waste Resources David Mackay Bricks/rubble - Treatment per Te Contribution £36.47 £38.29 £40.20 £42.21 5.0% 5.0% 5.0% Place Waste Resources David Mackay Lampheads - Treatment per Te Contribution £36.47 £38.29 £40.20 £42.21 5.0% 5.0% 5.0% Place Waste Resources David Mackay Skip Charges 20cyd - no treatment Contribution £116.23 £122.04 £128.14 £134.55 5.0% 5.0% 5.0% Place Waste Resources David Mackay Skip Charges 35cyd - no treatment Contribution £207.87 £218.26 £229.17 £240.63 5.0% 5.0% 5.0% Place Waste Resources David Mackay Special Uplift - disposal - 1/4te Contribution £39.27 £41.23 £43.29 £45.45 5.0% 5.0% 5.0% Place Waste Resources David Mackay Special Uplift - disposal - 1/2te Contribution £78.53 £82.46 £86.58 £90.91 5.0% 5.0% 5.0% Place Waste Resources David Mackay Special Uplift - disposal - Te Contribution £157.06 £164.91 £173.16 £181.82 5.0% 5.0% 5.0% Place Waste Resources David Mackay Void Uplift bin charge (Up to full set) Contribution £52.74 £55.38 £58.15 £61.06 5.0% 5.0% 5.0% Place Waste Resources David Mackay Special Uplift Squad - 30 min Contribution £52.74 £55.38 £58.15 £61.06 5.0% 5.0% 5.0% Place Waste Resources David Mackay Special Uplift Squad - 60 min Contribution £105.47 £110.74 £116.28 £122.09 5.0% 5.0% 5.0% Place Waste Resources David Mackay Special uplift - Confidential waste per bag Contribution £6.53 £6.86 £7.20 £7.56 5.0% 5.0% 5.0% Place Waste Resources David Mackay Direct disposal and treatment EFW per Te Contribution £157.06 £164.91 £173.16 £181.82 5.0% 5.0% 5.0% Appendix 6 43
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Directorate Service Manager Charge Description Charge Type Current Approved Charge excluding VAT (2023/24) £ Proposed Charge (2024/25) Indicative Charge (2025/26) Indicative Charge (2026/27) Basis of increase 2024/25 % Basis of increase 2025/26 % Basis of increase 2026/27 % Note COST PLUS FEES & CHARGES Communities & Housing Libraries Lesley Forsyth Lost and Damaged Audio, based on actual costs Cost plus £0.00 £0.00 £0.00 £0.00 5.0% 5.0% 5.0% Communities & Housing Libraries Lesley Forsyth Book Sales (NAC Stock), based on actual costs Cost plus £0.00 £0.00 £0.00 £0.00 5.0% 5.0% 5.0% Communities & Housing Libraries Lesley Forsyth Black and White Photocopying/Printing A4 or A3 single-sided Cost plus £0.10 £0.10 £0.10 £0.10 5.0% 5.0% 5.0% Communities & Housing Libraries Lesley Forsyth Black and White Photocopying/Printing A4 or A3 double-sided Cost plus £0.20 £0.20 £0.20 £0.20 5.0% 5.0% 5.0% Communities & Housing Libraries Lesley Forsyth Colour Photocopying/Printing A4 or A3 single-sided Cost plus £0.40 £0.40 £0.40 £0.40 5.0% 5.0% 5.0% Communities & Housing Libraries Lesley Forsyth Colour Photocopying/Printing A4 or A3 double-sided Cost plus £0.80 £0.80 £0.80 £0.80 5.0% 5.0% 5.0% Place Waste Resources David Mackay New/Replacement Waste Container 360 Litre Cost plus £78.76 £82.70 £86.84 £91.18 5.0% 5.0% 5.0% Place Waste Resources David Mackay New/Replacement Waste Container 1100 Litre Cost plus £429.91 £451.41 £473.98 £497.68 5.0% 5.0% 5.0% Place Waste Resources David Mackay New/Replacement Waste Container Lid on Lid 1100 Litre Cost plus £492.77 £492.77 £517.41 £543.28 0.0% 5.0% 5.0% Place Waste Resources David Mackay New/Replacement Waste Container 1280 Litre Cost plus £500.23 £525.24 £551.50 £579.08 5.0% 5.0% 5.0% Place Waste Resources David Mackay New/Replacement Waste Container Lid on Lid 1280 Litre Cost plus £566.60 £566.60 £594.93 £624.68 0.0% 5.0% 5.0% Place Waste Resources David Mackay New/Replacement Waste Container 240 Litre Cost plus £47.78 £50.17 £52.68 £55.31 5.0% 5.0% 5.0% Place Waste Resources David Mackay New/Replacement Waste Container 140 Litre Cost plus £32.82 £34.46 £36.18 £37.99 5.0% 5.0% 5.0% Place Waste Resources David Mackay New/Replacement Waste Container 660 Litre Cost plus £359.44 £377.41 £396.28 £416.09 5.0% 5.0% 5.0% Place Waste Resources David Mackay Sack Sales Pre-Paid - Trade Recycling per 100 Cost plus £131.94 £138.54 £145.47 £152.74 5.0% 5.0% 5.0% Place Waste Resources David Mackay Sack Sales Pre-Paid - Trade Waste per 50 Cost plus £127.88 £134.27 £140.98 £148.03 5.0% 5.0% 5.0% Appendix 6 44
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Directorate Service Manager Charge Description Charge Type Current Approved Charge excluding VAT (2023/24) £ Proposed Charge (2024/25) Indicative Charge (2025/26) Indicative Charge (2026/27) Basis of increase 2024/25 % Basis of increase 2025/26 % Basis of increase 2026/27 % Note NATIONALLY SET FEES & CHARGES Chief Executives Legal - Licensing Raymond Lynch Landlord Registration - Principal Nationally Set £75.00 £75.00 £75.00 £75.00 0.0% 0.0% 0.0% Chief Executives Legal - Licensing Raymond Lynch Landlord Registration - Property Nationally Set £17.00 £17.00 £17.00 £17.00 0.0% 0.0% 0.0% Chief Executives Legal - Licensing Raymond Lynch Landlord Registration - Late Application Nationally Set £149.00 £149.00 £149.00 £149.00 0.0% 0.0% 0.0% Health & Social Care Adults and Older People Eleanor Currie Blue Badge (charge for a three year period) Nationally Set £20.00 £20.00 £20.00 £20.00 0.0% 0.0% 0.0% Communities & Housing Planning Services Allan Finlayson Planning Application fees - Operations eg Construction of buildings - planning permission in principle Nationally Set £600.00 £600.00 £600.00 £600.00 0.0% 0.0% 0.0% Communities & Housing Planning Services Allan Finlayson Planning Application fees - Operations eg The erection of buildings - planning permission in principle Nationally Set £600.00 £600.00 £600.00 £600.00 0.0% 0.0% 0.0% Communities & Housing Planning Services Allan Finlayson Planning Application fees - Operations eg The erection of buildings - where the area of gross floor space to be created does not exceed 40 sq metres Nationally Set £300.00 £300.00 £300.00 £300.00 0.0% 0.0% 0.0% Communities & Housing Planning Services Allan Finlayson Planning Application fees - Uses of Land eg The change of use of a building Nationally Set £600.00 £600.00 £600.00 £600.00 0.0% 0.0% 0.0% Communities & Housing Protective Services (Building Standards) Scott McKenzie Building Warrant Application Fees, set by BSD, please refer to fees section in link below for full list of charges: https://www.north-ayrshire.gov.uk/planning-and-building-standards/building-standards/building- warrants.aspx Nationally Set various various various various 0.0% 0.0% 0.0% Communities & Housing Protective Services (Environmental Health) Scott McKenzie Ship inspection charges up to 1,000 tonnes Nationally Set £125.00 £125.00 £125.00 £125.00 0.0% 0.0% 0.0% Communities & Housing Protective Services (Environmental Health) Scott McKenzie Ship inspection charges 1,001 to 3,000 tonnes Nationally Set £170.00 £170.00 £170.00 £170.00 0.0% 0.0% 0.0% Communities & Housing Protective Services (Environmental Health) Scott McKenzie Ship inspection charges 3,001 to 10,000 tonnes Nationally Set £250.00 £250.00 £250.00 £250.00 0.0% 0.0% 0.0% Communities & Housing Protective Services (Environmental Health) Scott McKenzie Ship inspection charges 10,001 to 20,000 tonnes Nationally Set £325.00 £325.00 £325.00 £325.00 0.0% 0.0% 0.0% Communities & Housing Protective Services (Environmental Health) Scott McKenzie Ship inspection charges 20,001 to 30,000 tonnes Nationally Set £415.00 £415.00 £415.00 £415.00 0.0% 0.0% 0.0% Communities & Housing Protective Services (Environmental Health) Scott McKenzie Ship inspection charges over 30,000 tonnes Nationally Set £480.00 £480.00 £480.00 £480.00 0.0% 0.0% 0.0% Communities & Housing Protective Services (Environmental Health) Scott McKenzie Ship inspection charges extensions Nationally Set £95.00 £95.00 £95.00 £95.00 0.0% 0.0% 0.0% Communities & Housing Protective Services (Environmental Health) Scott McKenzie Ship inspection charges for vessels with the capacity to carry between 50 and 1,000 persons Nationally Set £480.00 £480.00 £480.00 £480.00 0.0% 0.0% 0.0% Communities & Housing Protective Services (Environmental Health) Scott McKenzie Ship inspection charges for vessels with the capacity to carry more than 1,000 persons Nationally Set £820.00 £820.00 £820.00 £820.00 0.0% 0.0% 0.0% Communities & Housing Protective Services (Environmental Health) Scott McKenzie Private water supplies - regulated supplies annual sampling and risk assessment Nationally Set £261.00 £261.00 £261.00 £261.00 0.0% 0.0% 0.0% Communities & Housing Protective Services (Environmental Health) Scott McKenzie Private water supplies - non regulated supplies Nationally Set £118.00 £118.00 £118.00 £118.00 0.0% 0.0% 0.0% Communities & Housing Protective Services (Environmental Health) Scott McKenzie Stray dog fee Nationally Set £25.00 £25.00 £25.00 £25.00 0.0% 0.0% 0.0% Place Streetscene Services Wallace Turpie/ David Mackay Fly Tipping fine Nationally Set £200.00 £200.00 £200.00 £200.00 0.0% 0.0% 0.0% Place Streetscene Services Wallace Turpie/ David Mackay Littering / Fly Posting fine Nationally Set £80.00 £80.00 £80.00 £80.00 0.0% 0.0% 0.0% Place Streetscene Services Wallace Turpie/ David Mackay Dog Fouling fine Nationally Set £80.00 £80.00 £80.00 £80.00 0.0% 0.0% 0.0% Place Streetscene Services Wallace Turpie/ David Mackay Abandoned vehicles minimum charge Nationally Set £150.00 £150.00 £150.00 £150.00 0.0% 0.0% 0.0% Place Streetscene Services Wallace Turpie/ David Mackay Storage of vehicles until dismantled. Daily charge Nationally Set £20.00 £20.00 £20.00 £20.00 0.0% 0.0% 0.0% Place Streetscene Services Wallace Turpie/ David Mackay Abandoned caravans / trailers minimum charge Nationally Set £500.00 £500.00 £500.00 £500.00 0.0% 0.0% 0.0% Place Transport Services Gordon Mitchell MOT Class 4 Nationally Set £54.85 £54.85 £54.85 £54.85 0.0% 0.0% 0.0% Place Transport Services Gordon Mitchell MOT Class 5 Nationally Set £59.55 £59.55 £59.55 £59.55 0.0% 0.0% 0.0% Place Transport Services Gordon Mitchell MOT Class 7 Nationally Set £58.60 £58.60 £58.60 £58.60 0.0% 0.0% 0.0% Place Roads Susan Macfadyen NRSWA Public Utility Sample Inspections Nationally Set £36.00 £36.00 £36.00 £36.00 0.0% 0.0% 0.0% Appendix 6 45
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Appendix 7 Employee Costs Property Costs Supplies & Services Transport & Plant Costs Admin Costs Other Agencies, Bodies & Persons Transfer Payments Other Expenditure Capital Financing Costs Income TOTAL Directorate £000 £000 £000 £000 £000 £000 £000 £000 £000 £000 £000 Chief Executives 17,539 68 2,950 23 1,363 1,873 853 0 0 (4,456) 20,212 Communities & Housing 25,600 2,890 6,482 690 282 10,375 0 104 0 (31,546) 14,877 Education 142,026 1,108 25,318 99 168 7,861 580 0 71 (4,487) 172,745 Place 29,087 21,208 3,739 7,032 556 11,762 0 78 0 (19,749) 53,712 Other Corporate Items 1,895 355 10,793 302 2,202 4,859 34,074 556 (80) (13,735) 41,223 Total Expenditure 216,147 25,629 49,283 8,146 4,571 36,730 35,507 739 (9) (73,973) 302,769 Health & Social Care Partnership 124,499 Revised Total Expenditure 216,147 25,629 49,283 8,146 4,571 36,730 35,507 739 (9) (73,973) 427,268 Funded by: AEF 0 0 0 0 0 0 2,803 0 0 (359,390) (356,587) Council Tax 0 0 0 0 0 0 14,006 0 0 (79,688) (65,681) Contribution from Reserves 0 0 0 0 0 0 0 0 0 (5,000) (5,000) Total Funding 0 0 0 0 0 0 16,809 0 0 (444,078) (427,268) Subjective Analysis North Ayrshire Council General Services Revenue Budget 2024-25 Summary by Directorate 46
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Appendix 7 Employee Costs Property Costs Supplies & Services Transport Costs Admin Costs Other Agencies, Bodies & Persons Transfer Payments Other Expenditure Capital Financing Income TOTAL Objective Analysis £000 £000 £000 £000 £000 £000 £000 £000 £000 £000 £000 Chief Executive's Office 208 0 1 1 5 0 0 0 0 (56) 159 Change Programme 8 0 0 0 0 0 0 0 0 0 8 Audit,Fraud,Safety & Insurance 902 61 31 5 19 7 0 0 0 (306) 719 Corporate Procurement 1,037 0 11 1 8 107 0 0 0 (158) 1,006 Financial Services 1,478 0 165 1 29 2 0 0 0 (173) 1,500 Revenues 547 0 55 1 169 0 0 0 0 (1,359) (587) Employee Services 849 0 68 0 7 4 0 0 0 (38) 890 HR & OD 711 0 21 0 26 413 0 0 0 (56) 1,115 ICT 3,293 0 2,128 5 11 0 0 0 0 (239) 5,197 Business Support 1,383 0 6 0 2 0 0 0 0 (135) 1,256 Customer Services 2,825 0 247 2 48 1,093 853 0 0 (955) 4,112 Transformation Services 694 0 11 0 1 38 0 0 0 0 743 Legal & Licensing 1,212 0 32 5 38 0 0 0 0 (753) 534 Policy,Performance & Elections 581 0 20 1 10 7 0 0 0 (20) 599 Communications 492 0 8 1 4 0 0 0 0 (7) 498 Civil Contingencies 0 0 0 0 0 60 0 0 0 0 60 Committee Services 466 6 114 0 7 55 0 0 0 (125) 524 Member Services 300 0 31 0 975 88 0 0 0 (55) 1,340 Information Governance 553 0 2 0 4 0 0 0 0 (21) 538 Total 17,539 68 2,950 23 1,363 1,873 853 0 0 (4,456) 20,212 Subjective Analysis North Ayrshire Council General Services Revenue Budget 2024-25 Chief Executives 47
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Appendix 7 Employee Costs Property Costs Supplies & Services Transport Costs Admin Costs Other Agencies, Bodies & Persons Transfer Payments Other Expenditure Capital Financing Income TOTAL Objective Analysis £000 £000 £000 £000 £000 £000 £000 £000 £000 £000 £000 Connected Communities 6,441 264 712 25 77 5,362 0 0 0 (635) 12,245 Planning Services 824 0 101 4 21 30 0 0 0 (610) 370 Protective Services 2,861 112 102 21 16 148 0 0 0 (1,352) 1,908 Building Services 10,083 117 5,345 579 14 2,833 0 0 0 (21,515) (2,543) Property Governance 964 3 38 4 103 25 0 0 0 (1,142) (7) Other Housing 3,916 2,395 184 44 51 1,971 0 104 0 (5,762) 2,903 Works Scoping & Assurance 510 0 1 13 1 5 0 0 0 (530) (0) Total 25,600 2,890 6,482 690 282 10,375 0 104 0 (31,546) 14,877 Subjective Analysis North Ayrshire Council General Services Revenue Budget 2024-25 Communities & Housing 48
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Employee Costs Property Costs Supplies & Services Transport Costs Admin Costs Other Agencies, Bodies & Persons Transfer Payments Other Expenditure Capital Financing Income TOTAL Objective Analysis £000 £000 £000 £000 £000 £000 £000 £000 £000 £000 £000 Early Years Education 15,769 9 217 4 36 4,495 0 0 0 0 20,529 Primary Education 42,464 0 2,443 9 0 77 0 0 0 (55) 44,938 Secondary Education 44,785 0 15,715 8 0 0 0 0 0 (3) 60,505 Additional Support Needs 17,893 0 60 46 23 2,004 0 0 0 (267) 19,759 Education - Other 2,785 156 395 10 86 1,274 580 0 71 (1,264) 4,093 Pupil Equity Fund 4,172 0 0 0 0 0 0 0 0 0 4,172 Facilities Management 14,160 943 6,489 21 23 10 0 0 0 (2,898) 18,749 Total 142,026 1,108 25,318 99 168 7,861 580 0 71 (4,487) 172,745 North Ayrshire Council General Services Revenue Budget 2024-25 Education Subjective Analysis 49
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Appendix 7 Employee Costs Property Costs Supplies & Services Transport Costs Admin Costs Other Agencies, Bodies & Persons Transfer Payments Other Expenditure Capital Financing Income TOTAL Objective Analysis £000 £000 £000 £000 £000 £000 £000 £000 £000 £000 £000 Directorate & Support 221 0 2 0 7 0 0 0 0 (23) 207 Roads 4,834 28 2,290 31 79 977 0 0 0 (1,305) 6,933 Streetscene 7,627 160 381 197 21 168 0 0 0 (3,133) 5,420 Waste Resources 5,732 20 669 214 66 6,788 0 78 0 (4,413) 9,155 Economic Development 3,315 36 48 19 24 904 0 0 0 (320) 4,027 Growth & Investment 144 0 5 1 4 103 0 0 0 0 258 Property Management & Investment 4,730 13,362 216 52 338 81 0 0 0 (8,863) 9,916 Energy & Sustainability 447 7,574 4 1 6 218 0 0 0 (935) 7,314 Internal Transport 2,037 28 123 6,518 11 2,521 0 0 0 (757) 10,482 Total 29,087 21,208 3,739 7,032 556 11,762 0 78 0 (19,749) 53,712 Subjective Analysis North Ayrshire Council General Services Revenue Budget 2024-25 Place 50
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Appendix 7 Employee Costs Property Costs Supplies & Services Transport Costs Admin Costs Other Agencies, Bodies & Persons Transfer Payments Other Expenditure Capital Financing Income TOTAL Objective Analysis £000 £000 £000 £000 £000 £000 £000 £000 £000 £000 £000 Joint Boards 0 0 0 0 0 3,590 0 0 0 0 3,590 Pension Costs 1,895 0 0 0 0 0 0 0 0 0 1,895 Loan Charges & Capital Charges 0 0 0 0 0 0 0 0 (80) 22,809 22,729 Central Telephones 0 0 0 0 350 0 0 0 0 0 350 Other Corporate Items 0 0 10,793 0 1,588 0 0 356 0 0 12,737 Insurance 0 355 0 302 265 1,269 0 0 0 (2,191) 0 Housing Benefit 0 0 0 0 0 0 34,074 200 0 (34,353) (78) Total 1,895 355 10,793 302 2,202 4,859 34,074 556 (80) (13,735) 41,223 Subjective Analysis North Ayrshire Council General Services Revenue Budget 2024-25 Other Corporate Items 51
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NORTH AYRSHIRE COUNCIL 28 February 2024 North Ayrshire Council Title: Capital Investment Programme 2024/25 to 2033/34 Purpose: To advise Council on the draft Capital Investment Programme to 2033/34 Recommendation: That Council : (a) approves the revised Capital Investment Programme to 2033/34 included in appendix 3; (b) notes that the programme will be reviewed on an on-going basis with the next major review in 2026/27; and (c) approves the refreshed Capital Investment Strategy included in appendix 4. 1. Executive Summary 1.1 This report outlines the recommendations of the full review of the capital investment programme which was undertaken during 2023/24. 1.2 The review considered the current Capital Investment Programme and takes cognisance of subsequent changes, including: • The ongoing impact of construction industry inflation, cost volatility and supply chain issues across the overall Capital Investment Programme; • Reductions in Scottish Government capital grants as detailed in the Local Government Finance Settlement 2024/25; • A review of spending profiles across key capital projects to support the Council’s priorities; and • Revised levels of investment across projects, taking cognisance of Council priorities, external funding sources and investing in core assets through asset management plans. 1.3 The review included an assessment of all funding sources over the 10 years of the plan, including assumed levels of general capital grant, specific grants and a prudent assessment of the level of capital receipts over the period. Total available funding has been projected at £189.987m. The balance of funding required to deliver the capital programme will be met through prudential borrowing and this is anticipated at £216.472m. 1.4 The proposed Capital Investment Programme, aligned to the Council Plan priorities, is attached in Appendix 3 and will deliver a total programme of £406.459m to 2033/34. Agenda Item 4 53
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1.5 Compliance with Regulations and the Prudential Code requires assurance to be provided on affordability and sustainability of the Capital Investment programme, this is provided in the Treasury Management and Investment Strategy (TMIS) which follows this report on the Council agenda. The TMIS recognises that this will require to be kept under review to ensure the underlying assumptions continue to apply. 1.6 The longer-term affordability of the current and future Capital Investment Programmes requires incremental increases the current General Fund financing budgets. A review of available General Fund financing budgets has been undertaken, with significant increases in revenue support recommended, as part of the General Services Revenue Estimates 2024/25 to 2026/27, to support the delivery of the draft Capital Investment Programme. 1.7 In addition to the TMIS, there is a requirement for the Council to publish a Capital Investment Strategy (CIS). As part of the review of the Capital Investment Programme, a review of the previous CIS has also been undertaken and a draft revised CIS is attached at Appendix 4. 1.8 The capital programme will continue to be reviewed on an on-going basis by Cabinet with any additional funding brought forward for approval as appropriate. Major reviews will be undertaken on a 3-year basis, with the next due to be completed during 2026/27. 2. Background Capital Investment Programme 2024/25 to 2033/34 2.1 North Ayrshire Council approved the current Capital Investment Programme for the period 2023/24 to 2030/31 on 1 March 2023. A comprehensive review of the Programme was undertaken during 2023/24. This report contains the outcome of that review. Review of Capital Funding Scottish Government General Capital Grant 2.2 Local Government Finance Circular 8/2023 confirmed the level of General Capital Grant as £8.628m for 2024/25. This comprises a core General Capital element of £9.068m, which is a reduction of (£0.939m) from that previously anticipated, less a (£0.440m) reduction linked to the re-phasing of the Flooding Projects. In addition, the Scottish Government has indicated that North Ayrshire will receive an allocation of £0.100m during 2024/25 to support Coastal Change Adaptation. Projected at the core level of £9.068m to 2033/34, the total General Capital Grant for the period is forecast as £90.780m. 54
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Scottish Government Specific Capital Grants 2.3 In addition to the General Capital Grant, the Council will receive two Specific Grants: • £0.963m to tackle Vacant and Derelict Land with projects requiring Scottish Government approval; and • £0.587m, to fund Cycling, Walking and Safer Streets (CWSS). The Vacant and Derelict Land funding is a reduction of (£0.543m) from that received during 2023/24 and has only been confirmed for 2024/25. However, the CWSS funding has been projected at current levels to 2033/34. 2.4 A further Specific Grant allocation of £0.925m to support the Renewal of Play Parks programme has been confirmed outwith the Local Government Finance Settlement for the period 2024/25 to 2025/26. 2.5 In addition, the programme includes previous Specific Grant allocations in relation to a number of programmes which have been carried over into 2024/25 in line with revised project plans, including: • £1.414m from the 2023/24 Vacant and Derelict Land allocation; • £0.500m from the 2023/24 Islands Pit Stops; and • £0.505m from the 2023/24 Place Based Investment Programme. 2.6 As a result, the total forecast Specific Grant income to 2033/34 is £9.214m. Other Government Funding 2.7 The programme includes funding from the Scottish and UK Governments to support the Ayrshire Growth Deal. The total anticipated funding over the period is £57.265m. This has been aligned to the latest programme planning information. 2.8 The UK Government previously confirmed that North Ayrshire Council has been awarded £23.693m from the Levelling Up Fund to support the upgrading of the B714 to improve connectivity between North Ayrshire and the wider motorway network. £21.553m of this award is anticipated for receipt during financial years 2024/25 to 2025/26. 2.9 During 2024-25 the UK Government confirmed total funding of £0.253m to support the Digital SIP Great Harbour project. £0.128m of this is anticipated during 2024/25. Other Internal Funds 2.10 The programme includes previously approved contributions from earmarked funds of £3.299m to support the Solar PV project and £5.595m to support the B714 Upgrade. However, these have been reduced by £4.000m to facilitate the transfer of the General Capital Grant support for the 2023/24 pay settlement to Revenue. 55
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Capital Receipts 2.11 A review of projected income from capital receipts has been undertaken during 2023/24. This is forecast to realise income of £4.143m over the period of the programme in relation to the sale of other Council owned assets. Other External Funding 2.12 In relation to additional grant funding from other external bodies, given the level of uncertainty around securing these funds, only those funds which have been confirmed, but not yet drawn down, have been included at this time. These include: Funding Source £m Project NAVT 0.800 Marine Tourism NAVT 0.110 Repurposing Property Grant Fund NAVT 0.101 Irvine Enterprise Area Sustrans 0.036 AGD Great Harbour £1.047m Prudential Borrowing 2.13 The difference between the Council's Capital Investment Programme and funding from the above sources is met through prudential borrowing of £216.472m. The Capital Investment Programme will be delivered within the approved loan charges revenue budget, utilising the balances held in the Prudential Investment Fund and Capital Fund to smooth the revenue implications of the borrowing costs associated with the revised programme. Development of the Capital Investment Programme to 2033/34 2.14 The approach to developing the draft Capital Investment Programme to 2033/34 included: • A full review of the current programme to 2030/31; • Identification of opportunities to reprioritise uncommitted projects; • Review of the phasing of projects from a delivery and affordability perspective; • Options appraisal of new requirements within the context of Council priorities; • Consideration of lifecycle investment to protect core assets. 2.15 The current capital investment programme to 2030/31, as approved by Council on 1 March 2023, has been updated to reflect the changes to the Programme approved by Cabinet during 2023/24, including any re-phasing of programmes to reflect updated project plans. Re-Profiling 2.16 A total of £33.336m of planned expenditure has been re-profiled from 2023/24 into 2024/25 to 2033/34 in line with updated project delivery timelines. Full details of individual projects re-phased from 2023/24 have been reported to Cabinet throughout the year. 56
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2.17 In order to address the recommendations made within the Audit Scotland report on the audit of the 2022/23 annual accounts, the phasing of expenditure within the draft Capital Investment Programme has been reviewed to reflect historic expenditure patterns and organisational capacity. This has resulted in the rephasing of approximately 19% of the planned expenditure in both 2024/25 and 2025/26 for delivery in later years, without impacting on the overall value of investment within the programme. The actual levels of expenditure will be continually monitored and reported to Cabinet throughout the life of the programme. Lifecycle Investment 2.18 Informed by the asset management plans, an additional £31.542m has been included in the Capital Investment Programme to ensure the Council continues to invest in its core assets and infrastructure. Many of these programmes include recurring annual investment which has been extended to include the period between the end of the current Capital Programme and 2033/34.These include: • £11.400m for Roads investment to maintain a steady state road condition over the next ten years; • £6.000m for the Vehicle Renewal programme; • £4.200m for Property Lifecycle Investment to enable high priority cyclical and statutory investment to extend the life of the Council’s core assets, ensuring that they remain fit for purpose and supporting delivery of core front line services; • £3.612m for Schools ICT investment; • £3.000m for Street Lighting replacement reflecting the age and condition of the lighting network; • £1.680m for the Bridges infrastructure programme; • £1.500m to support the Improvement Grants programme; and • £0.150m for the Access Paths Network programme. Additional Investments linked to Revised Funding 2.19 On 23 January 2024 Cabinet noted the provisional award of £37.4m for the Levelling up for Ayrshire – Commercial and Low Carbon Infrastructure project under round 3 of the UK Government’s Levelling Up Fund (LUF). The bid centred around commercial estate development and associated low carbon infrastructure in Irvine and around Prestwick airport. However, all funding is currently provisional pending completion of the current validation and onboarding process. The Council requires to provide a minimum of 10% match funding to support all LUF bids and a provision for £2.000m of match funding has been included within the Capital Investment Programme. 2.20 Local Government Finance Circular 8/2023 confirmed the level of Cycling, Walking and Safer Streets specific grant for 2024/25 at £0.587m. Expenditure has been projected at this level for the full period of the Capital Investment Programme, resulting in additional investment of £1.768m to 2033/34. In addition, Vacant and Derelict Land specific grant for 2024/25 has been confirmed at £0.963m and has been reflected in additional investment at this level. 57
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Additional / Revised Investments 2.21 In support of the Council’s Sustainable North Ayrshire Strategy 2024-27, an additional investment of £5.430m in the decarbonisation of the Council’s fleet is included. This investment will support the Council’s Fleet Decarbonisation Route Map through the replacement of fossil fuelled vehicles with electric vehicles and more environmentally sustainable fleet solutions. 2.22 On 29 August 2023 Cabinet approved an additional investment of £5.000m to support the B714 Upgrade project. As previously noted, the UK Government confirmed an award of £23.693m from the Levelling Up Fund to support the upgrading of the B714 to improve connectivity between North Ayrshire and the wider motorway network. Following a review of the costs involved in the delivery of the project, together with appropriate value engineering, it was determined that an additional investment of £5.000m was required. The UK Government confirmed that no additional funding was being made available to support this project and Cabinet approved the additional investment, supported by funding from the Investment and Recovery & Renewal Funds, additional allocations from anticipated capital receipts not currently committed and the proposed utilisation of existing resources from within the existing programme. 2.23 Following completion of the initial tender process for Ardrossan North Shore, an additional investment of £3.914m is included to reflect the additional tender costs through inflationary related cost volatility and the requirement to maintain an appropriate level of contingency funding within the project. 2.24 An additional investment of £2.500m has been included to support the anticipated outcomes of the ongoing locality-based property review. This review is developing options around how the Council best utilises its property assets within a Best Value context, taking account of the needs of our communities, staff workstyles and climate impact. This investment provision will remain under review as the programme of work develops through 2024/25. 2.25 On 7 November 2023 Cabinet approved changes to the Home Ownership Made Easy (HOME) project with the site being transferred to the HRA for the provision of social housing. This has resulted in the withdrawal of investment from the current General Services Capital Investment Programme, including a (£1.033m) reduction in planned expenditure for 2024/25. 2.26 Recent years have witnessed periods of significant volatility across the construction industry linked to the ongoing legacy impacts of the Covid-19 pandemic, the influence of national economic developments and international externalities arising from global conflicts and their impacts on costs and supply chains. These volatilities have manifested locally through increased borrowing costs, inflationary pressures, limited availability of contractors, supply chain issues and material shortages which are impacting on tender returns and the cost of materials. Where the resultant cost pressures have been quantified, additional expenditure requirements have been identified in relation to specific projects. However, unquantified risks have also been identified, or are anticipated, across a number of other projects, including the Upper Garnock Flood Protection Scheme, Moorpark Primary School and Ardrossan Harbour Landside works. In order to support the management of these and other emerging risks, it is proposed that the £10.000m investment within the Flexibility budget over the next five years is maintained. 58
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2.27 The current approved Capital Investment Programme to 2030/31 is attached at appendix 1. Full details of the proposed changes to the programme following the review, as outlined above, are included in appendix 2. The revised Capital Investment Programme covering the period from 2024/25 to 2033/34 is included in appendix 3. This will deliver a total programme of investment of £406.459m. Future Affordability 2.28 The Prudential Investment Fund was created as part of the 2015/16 budget strategy to utilise short term underspends on General Fund financing budgets to offset longer term pressures to support Prudential Borrowing arising from the Capital Investment Programme. 2.29 Due to the significant investment planned by North Ayrshire Council over the period to 2033/34, set within the context of government grant forecasts and combined with the additional cost pressures identified across a number of projects, it is projected that these funds will be exhausted before the end of the current 10 year Capital Investment Programme. In order to ensure the affordability of current and future capital investments beyond this, it will be necessary to incrementally increase the current General Fund financing budgets over the period of the programme. Additional funding support to mitigate the significant cost increases and the increased cost of borrowing includes the use of the recurring element of the Service Concession flexibility, approved at Council on 15 February 2023, which resulted in an average contribution of £3.437m from 2022/23 and the utilisation of the balance of savings from the temporary reduction in the employers’ superannuation contributions during 2024/25 and 2025/26. 2.30 In addition to the application of these non-recurring funds, it is necessary to include an indicative recurring pressure within the General Services Revenue Estimates 2024/25 to 2026/27. This includes an incremental contribution of £0.250m per annum from 2024/25, increasing to £0.450m from 2025/26 and £0.500m per annum from 2026/27. The impacts of inflationary pressures and interest rate fluctuations will continue to be monitored on an ongoing basis and the resultant increases in revenue contributions will be reviewed as part of the next major review of the capital programme, due to be undertaken during 2026/27. Treasury Management and Investment Strategy (TMIS) 2.31 Compliance with Regulation and the Prudential Code requires assurance to be provided on affordability and sustainability of the Capital Investment Programme. This is provided in the Treasury Management and Investment Strategy (TMIS) which follows this report on the Council agenda. The TMIS recognises that this will require to be kept under review to ensure the underlying assumptions continue to apply. Capital Investment Strategy 2.32 In addition to the TMIS there is also a requirement for the Council to publish a Capital Investment Strategy (CIS) which provides the overarching framework under which the draft Capital Investment Programme has been developed. The current CIS was approved by Council on 1 March 2023. During 2023/24 this has been refreshed with the revised CIS included at Appendix 4. 59
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Conclusion 2.32 The draft Capital Investment Programme 2024/25 to 2033/34, including proposed funding, is attached at Appendix 3. This confirms total investment of £406.459m over the period. The proposed investment aligns with the Council's key priorities, as set out in the Council Plan 2023-2028, core asset management plans and the refreshed Capital Investment Strategy, included at Appendix 4. 2.33 The programme is affordable based on the estimated funding streams set out in the 2024/25 to 2026/27 Medium Term Financial Plan and from the mitigating actions noted earlier in this report to supplement the Loans Fund. These proposals have been developed within a very challenging financial landscape impacted by a combination of significant cost volatility across the Programme and an increased cost of borrowing. The affordability of the Programme is also highlighted within the Treasury Management and Investment Strategy, reported elsewhere on the agenda, and this will be monitored on an ongoing basis. A further, full assessment of the Programme’s affordability will be undertaken as part of the next major review of the capital programme due for completion during 2026/27. 3. Proposals 3.1 It is proposed that Council : (a) approves the draft Capital Investment Programme 2024/25 to 2033/34 included in appendix 3; (b) notes that the programme will be reviewed on an on-going basis with the next major review in 2026/27; and (c) approves the refreshed Capital Investment Strategy included in appendix 4. 4. Implications/Socio-economic Duty Financial 4.1 The revised capital programme is based on a number of assumptions around the availability of finance including capital grant and capital receipts. Given the forward projection for 10 years, it is essential that these and the cost of projects are kept under review. There are a number of assumptions underpinning the current revenue projection including; the level of loans fund support, the level of future interest rates, delivery of the programme within the timelines outlined in the programme and application of the Capital Fund and the Prudential Investment Fund to smooth the revenue implications across the life of the plan. Due to the long-term nature of the borrowing required to support this programme, a review of available financing budgets has been undertaken with a view to increasing the available funding and maintaining the future affordability of the Programme. 60
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Human Resources 4.2 Through investment in the Capital Investment Programme, it is anticipated there will be additional staffing requirements. This will be considered on a project basis. Legal 4.3 None. Equality/Socio-economic 4.4 Where the Council is making decisions in relation to its spending priorities, it is obliged to comply with the public sector equality duty set out in the Equalities Act 2010. To meet this requirement, the Council assesses the impact of applying a decision against key groups to ensure that certain groups are not disadvantaged by those decisions. A number of the projects within the revised capital programme, will make a positive contribution to the Council’s commitment to equalities. Environmental and Sustainability 4.5 All projects within the revised plan will be delivered to minimise the impact on the environment and maximise sustainability. Further, specific projects within the plan will have a positive environmental impact. Key Priorities 4.6 The refreshed Capital Investment Programme 2024/25 to 2033/34 supports the delivery of the outcomes as outlined in the Council Plan 2023-2028 by focusing our investment on priorities, managing risk and supporting the delivery of key priorities. Community Wealth Building 4.7 The Council will aim to maximise opportunities within the context of the 5 pillars of Community Wealth Building from its investment programme. In particular, Ayrshire Growth Deal and growth and investment projects will make a positive contribution to economic regeneration across the region. 5. Consultation 5.1 Executive Directors have been consulted as part of the review the current capital investment programme and the identification of the proposed revisions and additions to the programme detailed in this report. Mark Boyd Head of Service (Finance) For further information please contact David Forbes, Senior Manager (Strategic Business Partner), on 01294 324551. Background Papers Capital Investment Programme 2023/24 to 2030/31 – North Ayrshire Council 1 March 2023 61
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Appendix 1 Project Description Revised 24/25 Revised 25/26 Revised 26/27 Revised 27/28 Revised 28/29 Revised 29/30 Revised 30/31 Total £ £ £ £ £ £ £ £ EXPENDITURE Place Roads Improvement / Reconstruction 3,800,000 3,800,000 3,800,000 3,800,000 3,800,000 3,800,000 3,800,000 26,600,000 Lighting 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 7,000,000 Millport Coastal FPS 20,035,000 20,035,000 Millport Pier 349,920 349,920 Millburn FPS 1,109,982 1,109,982 Bridges infrastructure programme 954,564 560,000 560,000 560,000 560,000 560,000 460,000 4,214,564 B714 Improvements 8,000,000 16,351,443 24,351,443 Property lifecycle investment 1,000,000 1,000,000 1,000,000 1,100,000 1,000,000 1,000,000 1,000,000 7,100,000 HOME 1,033,021 1,033,021 Cemetery extns, walls & infra 300,000 268,162 23,042 591,204 Cmty, Kilbirnie - Works 200,000 200,000 Cmty, Ardrossan - Extension 300,000 300,000 Renewal of Play Parks 347,000 578,000 925,000 Vehicles 1,022,023 2,000,000 2,977,977 2,000,000 2,000,000 2,000,000 2,000,000 14,000,000 Montgomerie Park Masterplan 50,000 100,000 600,000 350,000 490,000 500,000 2,090,000 Cycling / Walker / Safer Streets 586,000 586,000 586,000 586,000 586,000 586,000 586,000 4,102,000 Access Paths Network Programme 50,000 50,000 50,000 50,000 50,000 50,000 50,000 350,000 Growth & Investment Ayrshire Growth Deal: AGD - i3 DPMC Phase 1 394,551 394,551 AGD - i3 DPMC Phase 2 400,000 2,000,000 2,150,030 4,550,030 AGD - i3 Flexible Business Space Phase 1 978,000 2,419,000 7,591,500 411,818 11,400,318 AGD - Hunterston - Centre for Low Carbon Energy & Circular Economy 335,000 335,000 4,196,000 4,196,000 4,196,000 4,195,881 17,453,881 AGD - Great Harbour 4,025,000 4,188,000 2,335,000 2,221,000 86,000 88,474 12,943,474 AGD - IMSE 250,000 273,740 3,200,000 3,250,000 3,250,000 10,223,740 AGD Marine Tourism - Ardrossan 512,000 4,500,000 1,689,621 6,701,621 AGD Marine Tourism - Arran 30,000 40,000 150,000 1,600,000 104,611 1,924,611 AGD Marine Tourism - Cumbrae 50,000 150,000 1,600,000 96,750 1,896,750 Ardrossan Harbour & Landside 1,793,701 1,793,702 3,587,403 Irvine Enterprise Area 103,079 103,079 Ardrossan North Shore 10,912,238 1,694,804 12,607,042 Sub Total 59,621,079 43,614,111 30,082,910 21,421,568 16,982,611 17,020,355 9,396,000 198,138,634 Communities Montgomerie Park School 15,413,953 15,413,953 Universal Free School Meals Expansion 122,420 1,538,830 2,090,270 1,944,294 333,087 3,067,241 9,096,142 Schools ICT Investment 752,000 752,000 752,000 752,000 752,000 752,000 752,000 5,264,000 Ardrossan New Build 15,183,238 19,000,185 35,238,359 4,600,000 74,021,782 Sub Total 31,471,611 21,291,015 38,080,629 7,296,294 1,085,087 3,819,241 752,000 103,795,877 North Ayrshire Council Approved Capital Programme 2024/25 - 2030/31 (Base) 62
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Appendix 1 Project Description Revised 24/25 Revised 25/26 Revised 26/27 Revised 27/28 Revised 28/29 Revised 29/30 Revised 30/31 Total £ £ £ £ £ £ £ £ North Ayrshire Council Approved Capital Programme 2024/25 - 2030/31 (Base) Chief Executive ICT Investment Fund 382,400 376,600 702,600 297,600 282,600 282,600 297,600 2,622,000 WAN 500,000 500,000 LAN/WiFi 1,500,000 1,500,000 Telephony 650,000 650,000 Sub Total 382,400 376,600 702,600 2,947,600 282,600 282,600 297,600 5,272,000 Health & Social Care Partnership Community Alarms - Analogue to Digital 333,000 333,000 Improvement grants 500,000 500,000 500,000 500,000 500,000 500,000 500,000 3,500,000 Sub Total 833,000 500,000 500,000 500,000 500,000 500,000 500,000 3,833,000 Other Flexibility / Infrastructure Fund 7,000,000 100,000 7,100,000 Sub Total 7,000,000 100,000 7,100,000 TOTAL EXPENDITURE 92,308,090 72,781,726 69,466,139 32,165,462 18,850,298 21,622,196 10,945,600 318,139,511 Revised 24/25 Revised 25/26 Revised 26/27 Revised 27/28 Revised 28/29 Revised 29/30 Revised 30/31 Total £ £ £ £ £ £ £ £ INCOME Prudential Borrowing 68,762,811 33,183,283 50,474,139 13,173,462 1,218,552 (7,035,058) 352,600 160,129,789 Specific Grants - AGD 4,839,000 8,399,000 8,399,000 8,399,000 7,038,746 18,064,254 55,139,000 Specific Grants - Cycling, Walking & Safer Streets 586,000 586,000 586,000 586,000 586,000 586,000 586,000 4,102,000 Specific Grants - B714 Improvements 5,630,000 16,351,443 21,981,443 Specific Grants - Renewal of Play Parks 347,000 578,000 925,000 General Capital Grant 10,007,000 10,007,000 10,007,000 10,007,000 10,007,000 10,007,000 10,007,000 70,049,000 Recovery & Renewal 1,235,180 1,235,180 Grants & Contributions 901,099 901,099 Sale of land & buildings 3,677,000 3,677,000 TOTAL INCOME 92,308,090 72,781,726 69,466,139 32,165,462 18,850,298 21,622,196 10,945,600 318,139,511 63
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Appendix 2 Project Description Changes 24/25 Changes 25/26 Changes 26/27 Changes 27/28 Changes 28/29 Changes 29/30 Changes 30/31 Changes 31/32 Changes 32/33 Changes 33/34 Total £ £ £ £ £ £ £ £ £ £ £ EXPENDITURE Place Roads Improvement / Reconstruction 3,800,000 3,800,000 3,800,000 11,400,000 Traffic Calming 82,953 82,953 Lighting 1,000,000 1,000,000 1,000,000 3,000,000 Upper Garnock FPS 467,828 467,828 Millport Pier (329,920) 154,960 134,960 (40,000) Millburn FPS 343,547 343,547 Coastal Adaptations 99,727 99,727 Bridges infrastructure programme (100,000) 100,000 560,000 560,000 560,000 1,680,000 Largs Promenade Seawall 50,000 50,000 100,000 B714 Improvements (5,435,000) (1,574,749) 12,211,695 5,201,946 Property lifecycle investment 51,160 400,000 600,000 1,000,000 1,000,000 1,000,000 4,051,160 Locality Based Property Review 1,000,000 1,500,000 2,500,000 HOME (1,033,021) (1,033,021) Cemetery extns, walls & infra (229,285) (63,365) 122,560 11,521 (158,569) Cmty, Kilbirnie - Works (200,000) (200,000) Cmty, Ardrossan - Extension 150,000 450,000 600,000 Cmty, Kilbirnie - Walls 36,071 36,072 72,143 Cmty, Beith - Walls 51,416 51,417 102,833 Cmty, Abbey Tower - Walls 44,469 44,469 88,938 Cmty, Stev Hawkhill - Walls 51,196 51,196 102,392 Cmty, West Kilbride - Walls 47,282 47,282 94,564 Cmty, Kilbirnie - New 288,916 288,917 577,833 Goldcraigs Refurbishment 608,438 132,562 741,000 Vehicles (2,023) 2,023 2,000,000 2,000,000 2,000,000 6,000,000 Fleet Decarbonisation 2,320,000 1,660,000 1,950,000 5,930,000 Shewalton landfill 48,949 48,949 Solar PV Investment - Nethermains 260,720 260,721 521,441 Solar PV Investment - Shewalton 1,825,377 1,825,377 3,650,754 Repurposing Property Grant Fund 250,000 250,000 Islands Pit Stops 500,000 500,000 Place Based Investment Programme 350,000 350,000 Digital - SIPP Great Harbour 127,882 127,882 PBIP 36 Bank Street 50,000 50,000 PBIP Galt House 25,000 25,000 Montgomerie Park Masterplan 137,500 112,500 (25,000) 50,000 275,000 VDLF - 2024/25 allocation 963,000 963,000 VDLF - Irvine Kyle Road Phase 2 1,087,018 1,087,018 VDLF - Development Work 119,012 119,012 VDLF - Tree Planting 47,600 47,600 VDLF Stalled Spaces Fund 100,000 100,000 Cycling / Walker / Safer Streets 1,000 1,000 1,000 1,000 1,000 1,000 1,000 587,000 587,000 587,000 1,768,000 Access Paths Network Programme 445,000 50,000 50,000 50,000 595,000 North Ayrshire Council Capital Programme 2024/25 - 2033/34 - Revisions 64
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Appendix 2 Project Description Changes 24/25 Changes 25/26 Changes 26/27 Changes 27/28 Changes 28/29 Changes 29/30 Changes 30/31 Changes 31/32 Changes 32/33 Changes 33/34 Total £ £ £ £ £ £ £ £ £ £ £ North Ayrshire Council Capital Programme 2024/25 - 2033/34 - Revisions Growth & Investment Ayrshire Growth Deal: AGD - i3 DPMC Phase 1 5,898 300,000 305,898 AGD - i3 DPMC Phase 2 (300,449) (1,750,000) (693,169) 2,908,275 164,657 AGD - i3 Flexible Business Space Phase 1 1,047,920 (2,419,000) (7,591,500) (411,818) (9,374,398) AGD - i3 Flexible Business Space Phase 2 600,000 4,900,000 4,900,000 148,000 352,000 10,900,000 AGD - Hunterston - Centre for Low Carbon Energy & Circular Economy 333,892 (1) 333,891 AGD - Great Harbour (2,737,647) (1,881,436) 516,490 2,552,566 1,804,928 (31,909) 222,992 AGD - IMSE 445,000 (352,253) 92,747 AGD Marine Tourism - Ardrossan (512,000) (4,500,000) (1,689,621) 2,000,000 2,500,000 224,285 (1,977,336) AGD Marine Tourism - Arran 10,482 (37,837) (27,355) AGD Marine Tourism - Cumbrae 175,000 775,000 600,000 899,504 2,449,504 Ardrossan Harbour & Landside (914,222) (17,372) 896,851 (34,743) Irvine Enterprise Area (51,540) 51,540 Ardrossan North Shore 18,500,543 35,500 18,536,043 Sub Total 20,255,740 422,591 13,436,289 8,207,997 4,620,091 (158,878) 101,000 8,997,000 8,997,000 8,997,000 73,875,830 Communities Montgomerie Park School (2,364,552) (2,364,552) Universal Free School Meals Expansion 392,425 (327,021) (544,010) 1,136,848 (913) (137,500) 519,829 Schools ICT Investment 451,908 451,908 451,908 752,000 752,000 752,000 3,611,724 Ardrossan New Build (8,080,621) 1,371,270 (4,559,147) 17,410,374 6,141,876 Sub Total (9,600,840) 1,496,157 (4,651,249) 18,547,222 (913) (137,500) 752,000 752,000 752,000 7,908,877 Chief Executive ICT Investment Fund (158,700) 52,900 (145,500) 351,300 100,000 Telephony 115,000 115,000 230,000 Sub Total (43,700) 167,900 (145,500) 351,300 330,000 Health & Social Care Partnership Community Alarms - Analogue to Digital (264,024) 68,977 (195,047) Improvement grants 500,000 500,000 500,000 1,500,000 Sub Total (264,024) 68,977 500,000 500,000 500,000 1,304,953 Other Flexibility / Infrastructure Fund (7,000,000) 3,223,000 3,521,036 3,155,964 2,900,000 Core Infrastructure, property and Vehicles Renewal Investment 2,000,000 2,000,000 Sub Total 2,000,000 (7,000,000) 3,223,000 3,521,036 3,155,964 4,900,000 TOTAL EXPENDITURE 12,347,176 (4,844,375) 11,862,540 30,627,555 7,775,142 (296,378) 101,000 10,249,000 10,249,000 10,249,000 88,319,660 65
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Appendix 2 Project Description Changes 24/25 Changes 25/26 Changes 26/27 Changes 27/28 Changes 28/29 Changes 29/30 Changes 30/31 Changes 31/32 Changes 32/33 Changes 33/34 Total £ £ £ £ £ £ £ £ £ £ £ North Ayrshire Council Capital Programme 2024/25 - 2033/34 - Revisions Changes 24/25 Changes 25/26 Changes 26/27 Changes 27/28 Changes 28/29 Changes 29/30 Changes 30/31 Changes 31/32 Changes 32/33 Changes 33/34 Total £ £ £ £ £ £ £ £ £ £ £ INCOME Prudential Borrowing 9,537,439 (3,597,408) 5,359,081 22,110,062 7,534,232 12,703,178 914,000 594,000 594,000 594,000 56,342,584 Specific Grants - AGD (1,435,109) (1,743,415) 6,731,279 9,455,493 1,178,910 (12,061,556) 2,125,602 Specific Grants - Cycling, Walking & Safer Streets 1,000 1,000 1,000 1,000 1,000 1,000 1,000 587,000 587,000 587,000 1,768,000 Specific Grants - Vacant & Derelict Funding 2,376,630 2,376,630 Specific Grants - Islands Pit Stop 500,000 500,000 Specific Grants - Place Based Investment Programme 505,000 505,000 Specific Grants - B714 Improvements (428,054) (428,054) Specific Grants - Digital - SIPP Great Harbour 127,882 127,882 General Capital Grant - Flooding (440,000) 440,000 General Capital Grant (839,273) (939,000) (939,000) (939,000) (939,000) (939,000) (939,000) 9,068,000 9,068,000 9,068,000 20,730,727 Capital Fund 885,000 885,000 Recovery & Renewal 1,359,673 703,707 710,180 2,773,560 Grants & Contributions 96,988 49,560 146,548 Sale of land & buildings 100,000 241,181 125,000 466,181 TOTAL INCOME 12,347,176 (4,844,375) 11,862,540 30,627,555 7,775,142 (296,378) 101,000 10,249,000 10,249,000 10,249,000 88,319,660 66
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Appendix 3 Project Description Revised 24/25 Revised 25/26 Revised 26/27 Revised 27/28 Revised 28/29 Revised 29/30 Revised 30/31 Revised 31/32 Revised 32/33 Revised 33/34 Total £ £ £ £ £ £ £ £ £ £ £ EXPENDITURE Place Roads Improvement / Reconstruction 3,800,000 3,800,000 3,800,000 3,800,000 3,800,000 3,800,000 3,800,000 3,800,000 3,800,000 3,800,000 38,000,000 Traffic Calming 82,953 82,953 Lighting 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 10,000,000 Upper Garnock FPS 467,828 467,828 Millport Coastal FPS 20,035,000 20,035,000 Millport Pier 20,000 154,960 134,960 309,920 Millburn FPS 1,453,529 1,453,529 Coastal Adaptations 99,727 99,727 Bridges infrastructure programme 854,564 560,000 560,000 560,000 560,000 560,000 560,000 560,000 560,000 560,000 5,894,564 Largs Promenade Seawall 50,000 50,000 100,000 B714 Improvements 2,565,000 14,776,694 12,211,695 29,553,389 Property lifecycle investment 1,051,160 1,400,000 1,600,000 1,100,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 11,151,160 Locality Based Property Review 1,000,000 1,500,000 2,500,000 Cemetery extns, walls & infra 70,715 204,797 145,602 11,521 432,635 Cmty, Ardrossan - Extension 450,000 450,000 900,000 Cmty, Kilbirnie - Walls 36,071 36,072 72,143 Cmty, Beith - Walls 51,416 51,417 102,833 Cmty, Abbey Tower - Walls 44,469 44,469 88,938 Cmty, Stev Hawkhill - Walls 51,196 51,196 102,392 Cmty, West Kilbride - Walls 47,282 47,282 94,564 Cmty, Kilbirnie - New 288,916 288,917 577,833 Goldcraigs Refurbishment 608,438 132,562 741,000 Renewal of Play Parks 347,000 578,000 925,000 Vehicles 1,020,000 2,000,000 2,980,000 2,000,000 2,000,000 2,000,000 2,000,000 2,000,000 2,000,000 2,000,000 20,000,000 Fleet Decarbonisation 2,320,000 1,660,000 1,950,000 5,930,000 Shewalton landfill 48,949 48,949 Solar PV Investment - Nethermains 260,720 260,721 521,441 Solar PV Investment - Shewalton 1,825,377 1,825,377 3,650,754 Repurposing Property Grant Fund 250,000 250,000 Islands Pit Stops 500,000 500,000 Place Based Investment Programme 350,000 350,000 Digital - SIPP Great Harbour 127,882 127,882 PBIP 36 Bank Street 50,000 50,000 PBIP Galt House 25,000 25,000 Montgomerie Park Masterplan 137,500 162,500 75,000 650,000 350,000 490,000 500,000 2,365,000 VDLF - 2024/25 allocation 963,000 963,000 VDLF - Irvine Kyle Road Phase 2 1,087,018 1,087,018 VDLF - Development Work 119,012 119,012 VDLF - Tree Planting 47,600 47,600 VDLF Stalled Spaces Fund 100,000 100,000 Cycling / Walker / Safer Streets 587,000 587,000 587,000 587,000 587,000 587,000 587,000 587,000 587,000 587,000 5,870,000 Access Paths Network Programme 495,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 945,000 North Ayrshire Council Revised Capital Programme 2024/25 - 2033/34 67
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Appendix 3 Project Description Revised 24/25 Revised 25/26 Revised 26/27 Revised 27/28 Revised 28/29 Revised 29/30 Revised 30/31 Revised 31/32 Revised 32/33 Revised 33/34 Total £ £ £ £ £ £ £ £ £ £ £ North Ayrshire Council Revised Capital Programme 2024/25 - 2033/34 Growth & Investment Ayrshire Growth Deal: AGD - i3 DPMC Phase 1 400,449 300,000 700,449 AGD - i3 DPMC Phase 2 99,551 250,000 1,456,861 2,908,275 4,714,687 AGD - i3 Flexible Business Space Phase 1 2,025,920 2,025,920 AGD - i3 Flexible Business Space Phase 2 600,000 4,900,000 4,900,000 148,000 352,000 10,900,000 AGD - Hunterston - Centre for Low Carbon Energy & Circular Economy 668,892 335,000 4,196,000 4,196,000 4,196,000 4,195,880 17,787,772 AGD - Great Harbour 1,287,353 2,306,564 2,851,490 4,773,566 1,890,928 56,565 13,166,466 AGD - IMSE 445,000 250,000 273,740 3,200,000 3,250,000 2,897,747 10,316,487 AGD Marine Tourism - Ardrossan 2,000,000 2,500,000 224,285 4,724,285 AGD Marine Tourism - Arran 40,482 40,000 150,000 1,600,000 66,774 1,897,256 AGD Marine Tourism - Cumbrae 225,000 925,000 2,200,000 996,254 4,346,254 Ardrossan Harbour & Landside 879,479 1,776,330 896,851 3,552,660 Irvine Enterprise Area 51,539 51,540 103,079 Ardrossan North Shore 29,412,781 1,730,304 31,143,085 Sub Total 79,876,819 44,036,702 43,519,199 29,629,565 21,602,702 16,861,477 9,497,000 8,997,000 8,997,000 8,997,000 272,014,464 Communities Montgomerie Park School 13,049,401 13,049,401 Universal Free School Meals Expansion 514,845 1,211,809 1,546,260 3,081,142 332,174 2,929,741 9,615,971 Schools ICT Investment 1,203,908 1,203,908 1,203,908 752,000 752,000 752,000 752,000 752,000 752,000 752,000 8,875,724 Ardrossan New Build 7,102,617 20,371,455 30,679,212 22,010,374 80,163,658 Sub Total 21,870,771 22,787,172 33,429,380 25,843,516 1,084,174 3,681,741 752,000 752,000 752,000 752,000 111,704,754 Chief Executive ICT Investment Fund 223,700 429,500 557,100 648,900 282,600 282,600 297,600 2,722,000 WAN 500,000 500,000 LAN/WiFi 1,500,000 1,500,000 Telephony 115,000 115,000 650,000 880,000 Sub Total 338,700 544,500 557,100 3,298,900 282,600 282,600 297,600 5,602,000 Health & Social Care Partnership Community Alarms - Analogue to Digital 68,976 68,977 137,953 Improvement grants 500,000 500,000 500,000 500,000 500,000 500,000 500,000 500,000 500,000 500,000 5,000,000 Sub Total 568,976 568,977 500,000 500,000 500,000 500,000 500,000 500,000 500,000 500,000 5,137,953 Other Flexibility / Infrastructure Fund 3,323,000 3,521,036 3,155,964 10,000,000 Core Infrastructure, property and Vehicles Renewal Investment 2,000,000 2,000,000 Sub Total 2,000,000 3,323,000 3,521,036 3,155,964 12,000,000 TOTAL EXPENDITURE 104,655,266 67,937,351 81,328,679 62,793,017 26,625,440 21,325,818 11,046,600 10,249,000 10,249,000 10,249,000 406,459,171 68
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Appendix 3 Project Description Revised 24/25 Revised 25/26 Revised 26/27 Revised 27/28 Revised 28/29 Revised 29/30 Revised 30/31 Revised 31/32 Revised 32/33 Revised 33/34 Total £ £ £ £ £ £ £ £ £ £ £ North Ayrshire Council Revised Capital Programme 2024/25 - 2033/34 Revised 24/25 Revised 25/26 Revised 26/27 Revised 27/28 Revised 28/29 Revised 29/30 Revised 30/31 Revised 31/32 Revised 32/33 Revised 33/34 Total £ £ £ £ £ £ £ £ £ £ £ INCOME Prudential Borrowing 78,300,250 29,585,875 55,833,220 35,283,524 8,752,784 5,668,120 1,266,600 594,000 594,000 594,000 216,472,373 Specific Grants - AGD 3,403,891 6,655,585 15,130,279 17,854,493 8,217,656 6,002,698 57,264,602 Specific Grants - Cycling, Walking & Safer Streets 587,000 587,000 587,000 587,000 587,000 587,000 587,000 587,000 587,000 587,000 5,870,000 Specific Grants - Vacant & Derelict Funding 2,376,630 2,376,630 Specific Grants - Islands Pit Stop 500,000 500,000 Specific Grants - Place Based Investment Programme 505,000 505,000 Specific Grants - B714 Improvements 5,201,946 16,351,443 21,553,389 Specific Grants - Digital - SIPP Great Harbour 127,882 127,882 Specific Grants - Renewal of Play Parks 347,000 578,000 925,000 General Capital Grant - Flooding (440,000) 440,000 General Capital Grant 9,167,727 9,068,000 9,068,000 9,068,000 9,068,000 9,068,000 9,068,000 9,068,000 9,068,000 9,068,000 90,779,727 Capital Fund 885,000 885,000 Recovery & Renewal 2,594,853 703,707 710,180 4,008,740 Grants & Contributions 998,087 49,560 1,047,647 Sale of land & buildings 100,000 3,918,181 125,000 4,143,181 TOTAL INCOME 104,655,266 67,937,351 81,328,679 62,793,017 26,625,440 21,325,818 11,046,600 10,249,000 10,249,000 10,249,000 406,459,171 69
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Appendix 4 70
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Introduction The Capital Investment Strategy for North Ayrshire Council provides an overview of how capital expenditure plans, capital financing and treasury management activity contribute to the infrastructure and provision of services for the benefit of North Ayrshire communities and citizens. This refreshed strategy takes a long-term view and covers the period from 2024 to 2034. This is aligned to the Capital Investment Programme. The Capital Investment Strategy is a reporting requirement of the CIPFA Prudential Code. Local authorities produce many plans and strategies in the course of their operations. However, it is recognised that within the context of capital planning, there is a need to produce an overarching view that addresses the following key considerations: - • Ensuring that capital plans are aligned to the strategic priorities as set out in the Council Plan. • Ensuring that capital plans are affordable, prudent and sustainable. • Demonstrating the linkage to local strategic planning and local asset management planning. • Ensuring that financing decisions are taken in accordance with good professional practice and a full understanding of the risks involved. • Demonstrating the Council has robust governance arrangements to support its capital planning activities 71
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Background North Ayrshire Council has ambitious plans to deliver significant capital investment over the planning period across housing, schools, economic development and infrastructure. Working in partnership with East Ayrshire, South Ayrshire, the UK and Scottish Government, the Ayrshire Growth deal will see the regeneration of the region through investment in strategic infrastructure across various sectors, including life sciences, tourism, manufacturing and aerospace. Throughout 2023/24 the wider construction industry has reported significant, ongoing inflationary pressures linked to a number of factors, including additional costs as an ongoing consequence of the Covid-19 pandemic; upward pressure on input costs linked to international externalities such as ongoing global conflicts and its impact on global supply chains; material and labour shortages; and increased demand linked to reduced contractor availability. This has resulted in the identification of increased cost risks in relation to a number of our investment priorities. The Capital Investment Strategy takes account of the Council’s strategic priorities and considers any new investment within the context of outcomes, affordability or invest to save. Decisions made over the course of the programme for capital and treasury management will have financial consequences for the Council for many years in the future. There is also recognition of the need to balance investment between maintaining current assets and infrastructure against the ambitions for acquiring new assets. North Ayrshire Council’s Capital Investment Programme is shaped and influenced by various associated strategies and plans. 72
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The primary purpose of the Capital Investment Strategy is to provide an overarching view of how various plans and strategies inform capital investment and to demonstrate that this is both affordable and sustainable. The associated plans and strategies each focus on specific priority areas and, through appropriate governance structures, ultimately shape and influence the investment plans delivered through the Capital Investment Programme. Underpinning the Capital Investment Programme is the Treasury Management and Investment Strategy and Loans Fund Policy. Both ultimately consider the delivery of the capital programme within the context of affordability and risk and apply a measurement of what this means against key prudential and treasury indicators. The aim being to demonstrate affordability and sustainability over the long term. 73
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Plans and Strategies Council Plan 2023-2028 The mission for North Ayrshire Council is “Working together to improve the lives of our people in North Ayrshire.” To deliver on this mission 4 key strategic priorities, outlined below, have been developed to direct plans now and into the future. Through appropriate governance frameworks all capital investment must demonstrate that it is aligned to the Council’s strategic themes, with particular focus and priority given to capital investment opportunities that meet multiple strategic priorities. 74
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Community Planning Partnerships and Local Outcomes Improvement Plan The North Ayrshire Community Planning Partnership is a partnership across a wide range of organisations. The Local Outcomes Improvement Plan (LOIP) 2022 – 2030 provides a commitment by all partners to North Ayrshire communities and citizens across three main priority areas: The Community Planning Partnership consists of 6 Locality Partnerships across North Ayrshire. Key to the success of the LOIP is working in partnership with a number of agencies to deliver better outcomes for citizens and communities. The partnership includes Scottish Government, Police Scotland, NHS Ayrshire and Arran, Skills Development Scotland, KA Leisure, Scottish Fire and Rescue and Scottish Enterprise. Through the Local Development Plan, one of the strategic policies is to deliver on local community priorities. Each Locality Partnership has agreed their own local priorities. The following diagram illustrates the links between the locality priorities and those in the LOIP: 75
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This framework of community engagement and structured partnership working is vital when planning capital investment. More importantly, that local priorities are considered as part of any strategic planning framework. Health and Social Care Partnership Strategic Commissioning Plan 2022-2030 The North Ayrshire Health & Social Care Strategic Plan 2022-2030 was developed through engagement and collaboration with local people, service users, members of staff and other key stakeholders. It sets out our long-term ambitions for improving the health and wellbeing of everyone who lives in North Ayrshire. The 2022-2030 plan continues the existing vision that “all people who live in North Ayrshire are able to have a safe, healthy and active life” and to achieve this the HSCP focuses on key priorities: WELLBEING WORK WORLD 76
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Asset Management Plans Asset Management Plans aim to ensure that the Council holds the right assets and that they are fit for purpose in terms of condition, suitability and accessibility. The plans also provide the vehicle for identifying future investment needs across all asset classes. In line with the CIPFA “Guide to Asset Management and Capital Planning in Local Authorities” North Ayrshire has classified its assets into six categories: The Council’s assets play a key role in the delivery of a wide range of essential services to our local communities, contribute to regeneration and help drive economic growth. The plans set out clear actions and include details of lifecycle investment costs required to maintain assets and infrastructure to an appropriate standard that supports service delivery. The plans are updated on an annual basis and chief officers across all Directorates hold the responsibility for maintaining the plans and reporting progress to the Council’s Cabinet on a bi-annual basis. A snapshot of the asset portfolio for North Ayrshire Council includes: Both capital and revenue financial resources across the General Fund and Housing Revenue Account are used to maintain the current asset base. From a capital perspective, planned investment which has been incorporated in the current Capital Investment Programme includes: Fleet and Plant •Around 570 Vehicles and items of Plant Roads • Over 1,000 Km of roads Structures •Around 400 bridges and structures Street Lighting •Over 23,000 street lighting columns Operational Buildings • Over 70 offices, libraries and community centres Council Houses •Around 13,000 Council Houses Schools and Early Years •63 Schools and Early Years Facilities Social Care •21 Social Care Facilities 77
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Local Housing Strategy 2023-28 and Strategic Housing Investment Plan 2024- 29 The Local Housing Strategy sets out the Council’s ambition: ‘We want all our people to live in the right homes, in great places, with access to any support services they need.” The strategy mirrors the format of Scotland’s first 20 year housing strategy, Housing to 2040 and sets out four overarching outcomes which align to the four key strategies in Housing to 2040: •Planned investment of £112.8m to 2033/34 including improvements to the roads and street lighting network, upgrading of the B714, flood prevention works at Upper Garnock and Millport and bridges infrastructure improvement. Roads, Structures and Lighting •Procurement and maintenance of all Council fleet vehicles and plant ensuring the fleet of 566 vehicles and heavy plant are maintained and operated in accordance with the Council’s Operator’s licences and Road Transport legislation. Prioritisation of emissions reductions through decarbonisation of vehicle fleet. Vehicle and plant capital investment is planned at £25.9m to 2033/34. Fleet,Plant and Equipment •To ensure Council properties meet all legislative requirements and they are sustainable, energy efficient and maintained to a high standard as well as ensuring the physical environment is able to support mobile and flexible work programmes, Investment is planned at £18.6m to 2033/34. It is also recognised that through the Estates Strategy further rationalisation and remodelling will continue to be progressed on a locality by locality basis, with capital receipts incorporated into the capital programme. Property •Underpinned by the Local Housing Strategy, the Strategic Housing Investment Plan and the 30 Year HRA Business Plan, responsibility for maintenance of around 13,000 council houses, ensuring legislative compliance and meeting the needs of tenants. In addition, delivery of an ambitious house building and improvement programme over the period 2024/25-2028/29 will see capital investment by the Council total £352.0m. Housing •The Technology Strategy sets out how ICT supports service delivery and transformation. Significant changes to our ICT infrastructure have been reflected in the ICT Asset Management Plan. To deliver on the 6 key principles as outlined in the Technology Strategy £5.6m investment to 2033/34 is planned. ICT •The service maintains 2,410 hectares of public open space, a Country Park, 14 local parks, 44 cemeteries and burial grounds, 37 war memorials & monuments, 366 hectares of woodlands, 3 allotments, 91 sports facilities and playing fields, 84 equipped play areas and 12 multi-use games areas, residential greenspace, 38 water courses and open water features, 5 promenades and 16 beaches, three of which are Sites of Special Scientific Interest. The majority of investment is delivered through the Place service revenue budget, however, specific capital investment of £2.4m is planned to 2033/34 for cemetery infrastructure. Open Spaces 78
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The Strategic Housing Investment Plan is an extension of, and aligns to, the Local Housing Strategy, supporting the objectives of the Council Plan. The Strategic Housing Investment Plan also aligns with the Council’s Community Wealth Building Strategy and supports the North Ayrshire Child Poverty Action Plan 2022-2023. Access to good quality and affordable housing is a key asset in addressing child poverty, and poverty overall. The SHIP will secure investment in a total of 1,302 properties across North Ayrshire and provide sustainable, affordable, accessible high-quality homes which will contribute to the wider regeneration aims for the area. The Council projects in the SHIP represent investment of £194.464m (including an estimated £78.07m Scottish Government grant funding). Developments continue to be progressed across all six localities: Public sector investment can have a transformational impact for communities, and the Council explores site and area specific opportunities with partners to secure maximum regeneration benefits. This supports the ambitions of the Council’s Regeneration Delivery Plan to drive forward place-based development on strategic regeneration sites, including town centres. Several SHIP projects completed to date are within, or near, town centres. The plan supports major housing led regeneration including the replacement of the 275 homes in the Fullarton tower blocks in Irvine and the provision of funding to assist the delivery of Housing’s Estate Based Regeneration Programme. The Strategic Housing Investment Plan prioritises new social housing developments which include the provision of outdoor green space, and which support the principles of 20-minute neighbourhoods, where feasible. Developments are also planned utilising ‘secure by design’ principles. The Council and its partners recognise that bringing former social housing stock into ownership can assist with housing management and maintenance issues and increase housing available through the North Ayrshire Housing Register. All developing registered social landlord partners with stock in North Ayrshire now have provision for buyback programmes in the SHIP. Housing to 2040 Strategy Local Housing Strategy Outcome More homes at the heart of great places Affordability and choice Affordable warmth and zero emission homes Improving the quality of all homes Our places support thriving and inclusive communities Our people have affordable homes in the place they choose to live Our homes are energy efficient and release less emissions Our homes are in good condition and people can access any support services they need Arran Garnock Valley Irvine Kilwinning North Coast Three Towns 79
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New housing has a key role to play in carbon reduction, climate change mitigation, and in the alleviation of fuel poverty. The Council and its partners will continue to consider innovative and sustainable approaches to heat and power, such as low carbon heat, solar photovoltaic panels and smart technologies. The Council recognises that a ‘fabric first’ approach to sustainability can provide benefits to tenants, in terms of reducing heating costs. This investment aligns to the Council’s Environmental Sustainability and Climate Change Strategy in supporting affordable warmth to households across North Ayrshire. Developments will also be designed to promote sustainable travel. All amenity and sheltered housing in North Ayrshire should be built to an ambulant housing standard as a minimum. To ensure need is met now and in the future, the new Local Housing Strategy increased the target to ensure at least 10% of all tenure new build stock is suitable for wheelchair users (increased from 7% in the previous strategy). Officers within the Place Directorate and the Health and Social Care Partnership developed a new supported accommodation housing model which has been implemented at sites across North Ayrshire to maximise tenant independence The Local Housing Strategy recognises that the proportion of older people in North Ayrshire is higher than that of Scotland as a whole. The SHIP estimates the delivery of a further 311 amenity homes and 28 sheltered housing units. Alongside the new build programme, the Council will continue to deliver its sheltered housing re- provisioning programme, which includes £25m investment in the refurbishment of sheltered housing units out with the SHIP. Regeneration Delivery Plan and Local Development Plan The Regeneration Delivery Plan sets out our priorities for delivering on the regeneration ambitions of the Council Plan and Community Wealth Building strategy, working in partnership with communities. The Plan focuses on the delivery of physical regeneration across North Ayrshire through an ambitious project-based rolling action programme. The Regeneration Delivery Plan focuses activity around the four key regeneration themes: Mission Enhancing local wealth and the creation of fair jobs and maximising the potential of all our places through working in partnership with out communities and businesses Strengthening Communities Inclusive and Green Economy Placemaking Enabling Infrastructure 80
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The Local Development Plan was adopted in November 2019 and aligns to the themes set out in the Regeneration Delivery Plan, it brings a targeted local context in guiding development and investment in North Ayrshire over the next 20 years. The focus is supporting and growing the business base across key sectors including manufacturing, engineering, life sciences, tourism and hospitality and regenerating towns and communities. The overarching aim of the plan is to deliver the Community Planning Partnership vision of a “Better Life” to the citizens and communities of North Ayrshire. The plan outlines the land use strategy that supports delivery of the Local Outcomes Improvement Plan 2022 – 2030 and focuses on four key strategic policies: The Spatial Strategy is an overarching policy for supporting the LOIP. This directs development to towns and villages to support communities, the economy and environment, while recognising the value that the countryside and coastal areas offer both as natural resources worthy of protection and as an economic driver. An example of directing investment to towns is evidenced by the Montgomerie Park development with Council investment in road and service infrastructure to facilitate large scale housing development and regeneration and using capital receipts from land sale as a key source of funding. The Placemaking policy supports the LOIP by ensuring that all development contributes to making quality places. This is measured by six qualities that define a successful place: Distinctive Welcoming Safe and Pleasant Adaptable Resource Efficient Easy to Move Around and Beyond 81
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Through the Local Development Plan eight strategic development areas have been identified: Working in partnership with the UK and Scottish Government and East Ayrshire and South Ayrshire councils, the Ayrshire Growth Deal will regenerate the region through investment in strategic infrastructure across various sectors, including life sciences, tourism, manufacturing and aerospace, with total investment of over £251.5m. From a North Ayrshire perspective and to support investment into the strategic development areas, including the Ayrshire Growth Deal and wider economic regeneration activity, the Capital Investment Programme from 2024/25 to 2033/34 includes planned investment of £70.6m. Finally, our Community Wealth Building Strategy helps to develop resilient, inclusive local economies, with more local employment and a larger and more diverse business base, ensuring that wealth is locally owned and benefits local people. All capital and revenue investment will be considered within the context of the Community Wealth Building Strategy, with maximising opportunities for local suppliers through procurement a key priority and pillar of the strategy. Technology Strategy The Technology Strategy was approved by North Ayrshire Council in August 2021 and sets out the vision, principles and key technologies that will support transformational change across North Ayrshire Council. Solutions will be designed in partnership to improve processes, service delivery and collaboration and ultimately improve outcomes. The six key Technology Strategy principles are: Hunterston Ardrossan Harbour and North Shore i3 - Irvine Montgomerie Park, Irvine Kilbirnie Irvine Harbourside Brodick Cumbrae- Millport Deliberately designed •Holistic view of the business and deliver efficient, effective and agile solutions People at the core •Solutions built around the needs of customers and people Anytime, anywhere access •Access to systems, applications and information wherever they are Cloud where appropriate •Utilise cloud based technologies where appropriate Data driven •Utilise data to effectively inform our decision making Secure by design •Operate securely whilst still taking advantage of technology innovations 82
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Office 365 has been a transformative technology, enabling agile working and simplifying collaboration. The ICT Asset Management Plan incorporates the technology principles and, in terms of investment, a total of £5.6m is planned to 2033/34 to deliver technology solutions aligned to this strategy. From a financial planning perspective it is also recognised the shift from capital financing to revenue through software as a service, will lead to a remodelling of the way in which ICT investment is funded. Estates Strategy The key objective of North Ayrshire Council’s Estate Strategy is to achieve rationalisation and remodelling of the Council’s property portfolio on a locality basis. The Estates Strategy plays a key role in maximising capital investment across multiple strategic priority areas, e.g. moving away from the traditional like for like school replacements to incorporating wider community campus facilities, including leisure and health and social care facilities. This approach was evidenced through the Largs campus facility which delivered primary, secondary, and early years provision as well as community use sport, theatre and leisure facilities. Through rationalisation of the Council’s property portfolio, a key funding component to support the capital programme and provide flexibility in the Council’s Revenue account, is the generation of capital receipts. Anticipated income from land and property capital receipts planned to support the capital programme totals £4.1m to 2033/34. The neighbourhood approach outlined in the Estates Strategy also recognises community empowerment and, in particular, provides support to communities for asset transfers. This engagement is progressed through the Community Planning Partnerships. 83
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General Fund Capital Investment Programme North Ayrshire Council takes a long-term approach to capital investment, covering a 10-year period. The plan is updated annually and 2024/25 represents year 1 of the 10-year plan. A full refresh is undertaken every 3 years. The current Capital Investment programme is aligned to the strategic priorities as set out in the Council Plan and is the product of the various plans and strategies which impact on the assets and infrastructure of North Ayrshire Council. Through the Community Planning Partnerships and the Local Development Plan there is also clear linkage to local strategic planning and local asset planning. Total capital investment of £406.5m from the Council’s General Fund is planned over the period from 2024/25 to 2033/34, supporting the 3 key strategic priorities from the Council Plan. This includes planned expenditure of £70.6m towards the Ayrshire Growth Deal to 2033/34. It is recognised that the total level of investment across Ayrshire will be in the region of £251.5m (including £103m commitments from both the UK and Scottish Governments). Capital Programme 2024/25 to 2033/34 Total Investment £406.5m 84
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The capital plan includes £111.7m planned investment in Education. The major areas of education investment include; Investment in education reflects the Council’s desire to ensure children and young people have access to high quality facilities which support and promote excellent learning and teaching. Well designed and well-equipped buildings also support the promotion of positive health and well-being. It is also recognised that investment in education contributes to and can be integrated within wider economic development and regeneration within the localities and this is reflected in the nature of the planned developments for Ardrossan Academy and Montgomerie Park school. Through stakeholder engagement, effective cross Directorate working within North Ayrshire Council and collaboration with other agencies including the Scottish Government, these new developments combine education provision with community facilities, residential, respite and housing provision as part of a wider focus on economic regeneration. Investing in core assets and infrastructure is key to ensuring sustainability. A planned investment of £112.8m within Roads, Structures and Lighting includes £38.0m road improvements, £22.0m on flood prevention works and £29.6m on the upgrading of the B714 following a successful application to the UK Governments Levelling Up Fund. Property lifecycle investment of £11.2m, to support the property asset management plan, will ensure Council properties continue to be maintained to the appropriate standards in delivering services to citizens and communities. The plan includes investment in several key programmes of regeneration within North Ayrshire and, in respect of the Ayrshire Growth Deal, on a wider pan Ayrshire basis. The Capital Investment Programme 2024/25 to 2033/34 sets out the ambition of North Ayrshire Council and supports the key strategic themes of the Council Plan. Through investment that supports regeneration and delivers first class education and community facilities, this strategic approach will help grow the population and the local economy. It is also recognised that key to a sustainable environment is the requirement to continue to invest in core assets and infrastructure. Universal School meals Expansion - £9.6m •Improvements to current kitchen and dining facilities across the school estate to create capacity for the anticipated uptake. Ardrossan Campus- £80.2m •New build project as part of an exciting wider community facility development Montgomerie Park school £13.0m •New primary provision linked to Montgomerie park regeneration project and housing developments Schools ICT Investment £8.9m •Investment on ICT Equipment within the School Estate Figure 1 Artist impression of Ardrossan Campus Figure 2 Artist impression of Montgomerie Park Primary School 85
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Funding the Capital Investment Programme Funding the Capital Investment Programme requires to be planned in an affordable and sustainable manner. The funding sources to support delivery of the £406.5m capital investment programme to 2033/34 include; The major sources of funding include assumptions on the level of general capital grant from Scottish Government to 2033/34 (£90.8m) and the level of prudential borrowing (£216.5m) required. The cost of borrowing is included within the Council’s revenue budget process through the Medium-Term Financial Plan and the impact of borrowing is included as part of the Council’s Treasury Management and Investment Strategy. The Council takes a prudent approach when phasing the capital investment over the period, with the main objective to ensure general capital grant from Scottish Government is maximised. Other income sources are also explored including external income, grants, partner contributions and capital receipts. The balance of funding is met from affordable prudential borrowing with annual loans fund repayments made to reduce the debt. This approach helps to ensure that investment in assets to deliver on the Council’s strategic priorities is sustainable in the long term. £216.5 £89.1 £90.8 £4.9 £1.1 £4.1 Funding the Capital Investment Programme £406.5million Prudential Borrowing Specific Capital Grants General Capital Grant Reserve Funds Other Grants and Contributions Capital Receipts 86
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Treasury Management Strategy and Loans Fund Policy The Prudential Code for Capital Finance in Local Authorities enables councils to set their own borrowing limits with a requirement to ensure that investment plans are affordable, prudent and sustainable. The Council can borrow over a number of years to supplement its capital income, provided the resultant annual debt repayments can be accommodated within future years’ revenue budgets. The Council’s annual Treasury Management and Investment Strategy sets out the prudential indicators and parameters over the medium to long term, with regular reporting to Council members through: • Annual Treasury Management and Investment Strategy • Mid-Year Treasury Update report • Annual Report following the financial year end describing the activity compared to the strategy The key prudential and treasury indicators include: • Capital expenditure and financing • The Council’s overall borrowing need (the Capital Financing Requirement) • Limits to borrowing activity through the Operational Boundary and the Authorised Limit. As reflected in the Treasury Management Strategy for 2024/25, the analysis of the Capital Financing Requirement for North Ayrshire Council indicates that the borrowing needs to support delivery of the capital programme will increase to £821.544m by 2030/31 and then reduce annually to 2033/34. The analysis also indicates that this borrowing need continues to be within the parameters of both the Operational Boundary (the expected maximum borrowing position of the Council) and the Authorised limit (the limit beyond which external debt is prohibited). 87
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Another key affordability indicator is the ratio of financing costs to net revenue stream. This indicator identifies the trend in the cost of capital (borrowing and other long-term liabilities, net of investment income) against the net revenue stream of the Council. The estimates of financing costs include current commitments and those arising from the capital programme. The Housing Revenue Account (HRA) costs are aligned with the 30-year business plan. The estimated ratio of debt to net revenue stream across the next 3 years averages at 4.3% for General Services and 27.7% for the HRA. From a General Fund perspective, the CIPFA Directors of Finance Performance Indicators 2022/23 show a Scottish Local Authority average of 5.4%, therefore demonstrating a prudent borrowing policy. For the HRA, the indicative Scottish average in 2022/23 was 21.4%. The rising ratio within the HRA is indicative of the significant capital investment programme as outlined in the Strategic Housing Investment Plan. The level of loan charges is deemed prudent and affordable within the framework of the 30 year Housing business plan. The Liability Benchmark, another treasury prudential indicator, is an important tool used to identify whether the Council is likely to be a long-term borrower or long-term investor, allowing it to shape its strategic focus and decision making. The liability benchmark itself represents an estimate of the cumulative amount of external borrowing the Council must hold to fund its current capital and revenue plans while keeping treasury investments at the minimum level required to manage day-to-day cash flow. 2023/24 2024/25 2025/26 2026/27 Probable Outturn Estimate Estimate Estimate % % % % General Services 2.5% 3.5% 4.4% 4.9% HRA 20.5% 24.0% 28.7% 30.5% Proportion of financing costs to net revenue stream 88
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Loans Fund Policy In July 2016, the Scottish Government confirmed the new Loans Fund accounting arrangements under the provisions of the Local Authority (Capital Finance and Accounting) (Scotland) Regulations 2016. This regulation requires the Council to outline its policy on the repayment of Loans Fund advances. The Loans Fund advance is effectively the repayment of the principal linked to the capital expenditure which is required to be funded from borrowing. The broad aim of prudent repayment is to ensure that the authority’s unfinanced capital expenditure is financed over the expected life of the asset and that each year’s repayment amount is reasonably commensurate with the period and pattern of the benefits. From a governance perspective the Loans Fund policy of North Ayrshire Council is included as part of the Treasury Management and Investment Strategy and submitted for approval to the North Ayrshire Council committee on an annual basis. 89
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Governance Having robust governance arrangements in place is key to ensuring effective strategic management of assets, from initial planning through to delivery, utilisation and disposal. North Ayrshire Council delivers a governance framework through a number of officer and member represented groups / committees. To ensure a consistent approach is adopted when considering any new capital investment, a business case framework has been developed. The framework includes key criteria across: • Aims and strategic objectives • Scope and Benefits • Options Appraisal, • Risks, Constraints & Dependencies • Procurement arrangements • Monitoring of Key milestones • Evaluation criteria & scoring • Investment costs, funding and impact on revenue All business cases are considered by the Capital Programme and Assets Group and the Executive Leadership Team, with a recommendation being made to Cabinet / Council, for inclusion of new projects into the Capital Investment Programme. A key focus when assessing potential capital investment is the alignment to the Council’s strategic priorities, with the aim being to maximise opportunities where investment meets multiple strategic priorities and where there is the potential to lever in external funding. The current governance framework is illustrated below: Cabinet North Ayrshire Council Executive Leadership Team Strategic Assets Group Service Project Boards Programme Boards Capital Programme and Assets Group 90
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The Strategic Assets Group provides a strategic focus on the Council’s property assets. The key objective of the group is the effective utilisation of Council assets and to reduce the public sector’s building footprint and deliver improved services from a smaller, more efficient and fit for purpose estate. Service Project Boards are chaired by Executive Directors across each Directorate area with representation from relevant service managers. Following approval by North Ayrshire Council committee on the Capital Investment Programme, the Service Project Board is responsible for ensuring robust project management is in place to deliver projects on time and within budget. Programme Boards provide a strategic focus at programme level and are chaired by the responsible Chief Officer. Each programme can include a number of individual projects across each Directorate which contribute to specific Council and programme objectives. To ensure the objectives are met the Chief Officer for the programme is responsible for strategic oversight including all projects that form part of the overall programme. The Capital Programme and Assets Group is chaired by the Head of Service (Finance) and is responsible for: • Ensuring a strategic and corporate overview of the Council’s capital programme is in place. • Developing and monitoring the Council’s capital investment programme, tracking slippage on delivery and expenditure against approved budgets. • Developing clear criteria for investment of Council resources on asset matters and assessing all investment business cases. • Developing a prudent capital receipts programme for inclusion in the Council’s Capital Programme. The Executive Leadership Team consists of the Chief Executive, Executive Director Communities, Executive Director Place, Head of Democratic Services, Head of People and ICT and Head of Finance and is responsible for advising members on the relative priorities of the Council’s long term investment needs and plays a key monitoring role in ensuring the major capital projects deliver the anticipated benefits on time and within budget. The Executive Leadership Team also considers all business cases for new areas of capital investment as well as being the escalation point for any key strategic decisions across the Capital Investment Programme prior to consideration by Cabinet or Council. Cabinet is chaired by the Leader of the Council and is the main decision-making body of the Council. It consists of member portfolio holders from the Administration. Cabinet receives regular progress reports and approves amendments to the Capital Investment Programme. North Ayrshire Council consists of all elected members and is chaired by the Provost. The Council approves the corporate framework and the medium and longer term Capital Investment Programme. 91
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Knowledge & Skills North Ayrshire Council employs professionally qualified and experienced staff in senior positions with responsibility for making capital expenditure, borrowing and investment decisions. The Head of Finance is a qualified accountant and holds the position of Section 95 officer for the Council. The Council’s Section 95 Officer is responsible for the proper administration of the Council’s financial affairs and is required: • to recommend treasury management policies / practices, review these regularly and monitor compliance; • to submit regular treasury management updates; • to receive and review management information; • to review the performance of the treasury management function; • to ensure the adequacy of treasury management resources and skills and the effective division of responsibilities within the treasury management function; and • to approve the appointment of external service providers. Where the Council does not have the knowledge and skills required, use is made of external advisers that are specialists in their field. The Council currently employs Arlingclose Limited as treasury management advisers to ensure that we have access to specialist knowledge and skills if required. Decisions to invest in land and property are overseen in accordance with Council policies and the priorities from our Council plan, to capitalise on its position, power and influence to deliver tangible improvements to the lives of people in North Ayrshire. These decisions are made by suitably qualified personnel including architects and surveyors. Risk There are risks inherent across all capital planning and project delivery activity. Key planning risks are managed / mitigated through detailed business case development prior to any capital investment project getting approved. From a project delivery perspective, risk registers are maintained throughout the duration of the project and in accordance with standard project management practice. The long-term view to capital investment and the development of associated strategies also play a key role in risk management. Examples include: • Development of a 10-year capital programme, considering funding and priorities in the long term • Asset Management Plans and lifecycle maintenance which inform capital plans in the long term • Treasury Management and Investment Strategy which considers borrowing levels in the long term. • Local Housing Strategy and Strategic Housing Investment Plan takes a medium and long-term view of housing and regeneration priorities. 92
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Conclusion The Capital Investment Strategy for North Ayrshire Council provides an overview of how capital expenditure plans, capital financing and treasury management activity contribute to the infrastructure and provision of services for the benefit of North Ayrshire communities and citizens. It is a reporting requirement of the CIPFA Prudential Code. The Strategy takes account of the Council’s strategic priorities and considers any new investment within the context of outcomes and affordability. There is also recognition of the need to balance investment between maintaining current assets and infrastructure against the ambitions for acquiring new assets. The current capital programme demonstrates an innovative approach in maximising investment across multiple strategic priority areas, with developments that incorporate education provision, community facilities, health and social care services and housing. This approach, whilst providing key services that deliver positive outcomes to communities, also contributes to the wider economic regeneration of North Ayrshire, helping to grow the population and the local economy. Working in partnership with the UK and Scottish Government and East Ayrshire and South Ayrshire councils, the Ayrshire Growth Deal will regenerate the region through investment in strategic infrastructure across various sectors, including life sciences, tourism, manufacturing and aerospace, with total investment of over £251.5m. 93
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Related Documents / Strategies / Plans Council Plan Local Development Plan Asset Management Plans Local Outcomes Improvement Plan Local Housing Strategy Strategic Housing Investment Plan Technology Strategy Estates Strategy 10 Year Capital Investment Programme Regeneration Delivery Plan Treasury Management and Investment Strategy Loans Fund Policy HSCP Strategic Plan Environmental,Sustainability & Climate Change Strategy 94
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NORTH AYRSHIRE COUNCIL 28 February 2024 North Ayrshire Council Title: Revenue Estimates 2024/25 – Common Good Funds and Trusts Purpose: To advise Council of the anticipated annual income and expenditure of the Common Good Funds and Trusts administered by North Ayrshire Council and seek approval for the level of funding to be made available for disbursement during 2024/25. Recommendation: That Council: (a) approves the 2024/25 revenue estimates for the Common Good Funds and registered Charitable Trusts detailed in Appendix 1; (b) approves the carry forward of funds from Irvine Common Good Fund to meet the costs of essential works required at Seagate Castle, as noted at paragraph 2.2; (c) approves the amounts available for disbursement noted at paragraphs 2.12 and 2.13; (d) agrees to capital spend from the dormant and low value Trusts and Common Good Funds, and instructs officers to seek approval from the Office of the Scottish Charity Regulator (OSCR) prior to the disbursement of any grant which would result in the winding up of a Trust; (e) notes that approval will now be sought from OSCR for the winding up of the James Dyer Simpson Fund, H Watt Trust and J H Watt Trust, held within North Ayrshire Charitable Trust. 1. Executive Summary 1.1 The Council is the custodian of the Common Good Funds for the former burghs of Ardrossan, Irvine, Largs, Millport, Saltcoats and Stevenston and a number of charitable Trusts, which are largely composed of bequests made many years ago. 1.2 This report provides Members with an overview of the financial position of each Common Good Fund and Charitable Trust and recommends the level of expenditure which can be disbursed from each for 2024/25. Agenda Item 5 95
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1.3 Following delays in previous financial years, previously approved essential works at Seagate Castle have not yet been completed and Council is asked to approve the carry forward of this budget to allow the completion of these works during 2024/25. Should cost projections exceed estimates, a further report will be presented to Council. 1.4 The Common Good Funds and Trusts make annual disbursements of grants to groups and individuals. The level of funding available for these grants is normally set at the net annual income of each Fund or Trust after meeting their expenditure commitments. For Common Good Funds, where the expenditure commitments exceed the annual income, the recommended budget for grant disbursement reflects the level of disbursements in previous years or £5,000, whichever is the greater. 1.5 In order to encourage the utilisation of funds across communities, in particular where the Trusts have been dormant or have low levels of income, it is recommended that, with the exception of those Trusts with significant balances, the full balance of the Trusts are approved as available for disbursement. Any disbursement which utilises the full capital balance will result in closure and will require the approval of OSCR. During 2024/25, the funds within Douglas Sellers Trust and Anderson Park Trust will be exhausted. Approval will be sought from OSCR for the disbursement of any remaining capital and winding up of these Trusts. 1.6 During 2023/24 the remaining capital within James Dyer Simpson Fund, H Watt Trust and J H Watt Trust, held within the North Ayrshire Charitable Trust, was disbursed. Approval will be sought from OSCR for winding up of these Trusts. 2. Background Common Good Funds 2.1 The Council is the custodian of the Common Good Funds for the former burghs of Ardrossan, Irvine, Largs, Millport, Saltcoats and Stevenston. The purpose of the Common Good Funds is to benefit the general population within the defined areas of each of their respective towns. 2.2 At its meeting on 5 March 2020, Council approved the allocation of £0.250m from Irvine Common Good Fund to meet the costs of works required at Seagate Castle. Following delays in the completion of these works during previous financial years, Council is asked to approve the carry forward of the £0.189m balance to allow the completion of the works during 2024/25. As noted in the previous reports to Council, working on a structure as historic as this may flag up further works which may need to be addressed at the same time. Should cost projections exceed estimates, a further report will be presented to Council. 96
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2.3 The Common Good Funds make annual disbursements to groups and individuals based on approved criteria. The levels of grant available for disbursement is determined after all expenditure commitments and projected income from assets has been assessed. Current practice has been for the remaining surplus to be made available for trustees to disburse, ensuring that capital balances are left intact, with the disbursement of funds from the capital balance requiring Council approval. It is recommended that this practice continues for those Common Good Funds with sufficient net income, with the minimum budget set at £5,000 for each. 2.4 In the case of Irvine and Largs Common Good Funds, the level of expenditure exceeds the level of income. In order to maximise the benefits to the community, it is proposed that the budgets for grant disbursement are set at a level which reflects previous years’ disbursements. Charitable Trusts 2.5 The Council also administers a number of Trusts which are largely composed of bequests made many years ago. Of these Trusts, there are only two which accrue significant levels of income; the Spier’s Trust and the Margaret Archibald Trust. The Spier's Trust was founded in 1936 for the administration of Spier's School, Beith and for the provision of educational grants and bursaries for the benefit of the local area, comprising the parishes of Beith, Dalry, Dunlop, Kilbirnie, Lochwinnoch and Neilston. The purpose of the Margaret Archibald Trust is "to apply the capital and income from time to time, at the discretion of the Council, for the charitable purpose of persons in need who have attained sixty five years of age, living in the Parish of Dalry, Ayrshire". 2.6 The remaining Trusts comprise four town Trusts, covering Dalry, Kilbirnie & Glengarnock, Kilwinning and Largs, which provide assistance to persons in need within the defined area of each fund; the North Ayrshire Council Trust, which incorporates a further seven smaller funds; two minor Trusts and a number of sundry bequests listed on Appendix 2. 2.7 Historically a number of Trusts have experienced periods of dormancy where no grant applications have been received. OSCR is keen that charities fulfil their charitable purposes and the Council’s external auditors have previously expressed concern about the continued lack of activity in these Trusts. If no other action is taken, the annual external audit fee and administrative charges will eventually exhaust these Trusts. As such, the utilisation of available funds through a particular project which complies with the Trust’s purposes should be considered. It is, therefore, recommended that, with the exception of those Trusts with significant balances, the full balances of the town and minor Trusts are made available for disbursement. It should be noted that any disbursement which would result in the winding up of a registered Trust must be approved by OSCR before the relevant Locality Partnership agrees the grant. For those Trusts with significant balances, it is proposed that the budgets for grant disbursement are set at a level which reflects previous years’ disbursements. 2.8 During 2024/25, the funds within Douglas Sellers Trust and Anderson Park Trust will be exhausted. Approval will be sought from OSCR for the disbursement of the remaining capital and winding up of these Trusts. 97
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2.9 As previously reported to Council in March 2023, the James Dyer Simpson Fund, H Watt Trust and J H Watt Trust have disbursed all remaining funds and approval will now be sought from OSCR for the winding up of these 3 Trusts by the Council’s Legal Services Team. 2.10 The following table summarises the anticipated income and expenditure for each Common Good Fund and Trusts and the proposed budget for grant disbursement for each: 2.11 The remaining smaller trusts administered by the Council are listed in Appendix 2. Projected income for 2024/25 is £232 and during 2023/24, thus far, there have been no disbursements. Therefore, the full balance of £13,970 is available for disbursement during 2024/25. Estimated Balance at 1 April 2024 Estimated Income 2024/25 Estimated Expenditure 2024/25 Available for Disbursement Estimated Balance at 31 March 2025 £ £ £ £ £ Common Good Fund Ardrossan 344,472 44,320 (13,883) (30,437) 344,472 Irvine 1,118,352 83,875 (239,430) (41,041) 921,756 Largs 433,573 22,634 (29,061) (10,000) 417,145 Millport 68,823 1,150 (378) (5,000) 64,595 Saltcoats 14,781 230 (80) (5,000) 9,931 Stevenston 188,342 17,430 (1,030) (16,400) 188,342 TOTAL 2,168,342 169,639 (283,862) (107,878) 1,946,241 Registered Charitable Trusts Dalry 1,823 30 (168) (1,685) 0 Kilbirnie & Glengarnock 2,975 40 (174) (2,841) 0 Kilwinning 37,618 630 (386) (37,862) 0 Largs 2,261 30 (176) (2,115) 0 Speir's Trust 61,666 4,230 (1,175) (3,055) 61,666 Margaret Archibald Trust 211,661 14,266 (504) (13,762) 211,661 Douglas Sellers Trust 164 0 (158) (6) 0 Anderson Park Trust 22 0 0 (22) 0 NAC Charitable Trust 47,644 2,694 (316) (2,378) 47,644 TOTAL 365,834 21,920 (3,057) (63,726) 320,971 98
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3. Proposals 3.1 That Council: (a) approves the 2024/25 revenue estimates for the Common Good Funds and registered Charitable Trusts detailed in Appendix 1; (b) approves the carry forward of funds from Irvine Common Good Fund to meet the costs of essential works required at Seagate Castle, as noted at paragraph 2.2; (c) approves the amounts available for disbursement noted at paragraphs 2.12 and 2.13; (d) agrees to capital spend from the dormant and low value Trusts and Common Good Funds, and instructs officers to seek approval from the Office of the Scottish Charity Regulator (OSCR) prior to the disbursement of any grant which would result in the winding up of a Trust; (e) notes that approval will now be sought from OSCR for the winding up of the James Dyer Simpson Fund, H Watt Trust and J H Watt Trust, held within North Ayrshire Charitable Trust. 4. Implications/Socio-economic Duty Financial 4.1 Approval of the budgets will allow each Locality Partnership to disburse individual grants up to the approved levels. All income and expenditure which relates to Common Good properties must be charged to the relevant Common Good Fund. Human Resources 4.2 None. Legal 4.3 All expenditure from Trusts and Common Good Funds must be for the purposes of the Trust or meet the Common Good criteria of benefitting the inhabitants of the Common Good area. Equality/Socio-economic 4.4 None. Environmental and Sustainability 4.5 None. 99
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Key Priorities 4.6 This report directly supports the Council Plan 2023 to 2028 by developing strong relationships with communities and providing support for community organisations in achieving their goals. Community Wealth Building 4.7 None. 5. Consultation 5.1 Legal Services have been consulted on the recommendations and procedures for winding up the Trusts. Click here to enter text. Mark Boyd Head of Service Finance(Chief Executives) For further information please contact David Forbes, Senior Manager (Strategic Business Partner), on 01294 324551. Background Papers None 100
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Index of Common Good and Trust Funds Page Appendix 1 Common Good Funds Ardrossan 1 Irvine 2 Largs 3 Millport 4 Saltcoats 4 Stevenston 5 Trusts North Ayrshire Council (Dalry) Charitable Trust 6 North Ayrshire Council (Kilbirnie & Glengarnock) Charitable Trust 6 North Ayrshire Council (Kilwinning) Charitable Trust 7 North Ayrshire Council (Largs) Charitable Trust 7 Speir’s Trust 8 Margaret Archibald Trust 8 Douglas Sellers Trust 9 Anderson Park Trust 9 North Ayrshire Council Charitable Trust 10 Appendix 2 Sundry Bequests 11 101
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1 | P a g e Budget 2023/24 Projected Outturn 2023/24 Proposed Budget 2024/25 £ £ £ 308,045 325,082 Projected Common Good Balance Brought Forward at 1 April 344,472 INCOME 38,500 38,500 Rental - Ardrossan Civic Centre 38,500 7,700 15,090 Loans Fund Interest (on cash balances) 5,820 46,200 53,590 TOTAL INCOME FOR THE YEAR 44,320 EXPENDITURE Property Costs 12,000 0 External Property Repairs - Ardrossan Civic Centre 12,000 Others 1,586 1,586 Administration - Charge from Finance 1,883 13,586 1,586 SUB TOTAL OF EXPENDITURE 13,883 32,614 52,004 SURPLUS/(DEFICIT) FOR THE YEAR BEFORE GRANTS 30,437 32,614 32,614 Available for Disbursement as Grants 30,437 0 19,390 FINAL SURPLUS/(DEFICIT) FOR THE YEAR INCLUDING GRANTS 0 308,045 344,472 COMMON GOOD BALANCE CARRIED FORWARD AT 31 MARCH 344,472 COMMON GOOD FUND - ARDROSSAN 102
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2 | P a g e Budget 2023/24 Projected Outturn 2023/24 Proposed Budget 2024/25 £ £ £ 1,093,549 1,115,681 Projected Common Good Balance Brought Forward at 1 April 1,118,352 INCOME Property Rentals 25,000 25,000 Woodlands Centre 25,000 11,500 11,500 Bank Street (Church of Latter Day Saints) 11,500 13,385 13,385 Irvine Moor 13,385 13,000 13,000 Ground East Road (McConnachies) 13,000 2,000 2,000 East Road New Car Park 2,000 Other Income 27,340 49,260 Loans Fund Interest (on cash balances) 18,990 92,225 114,145 TOTAL INCOME FOR THE YEAR 83,875 EXPENDITURE Property Costs 500 500 General Repairs 500 10,500 10,219 Rates on vacant properties (36/38 Bank Street) 10,500 3,110 3,110 Electricity 1,837 30,445 28,995 Grounds Maintenance* 30,445 210,000 21,000 Property Maintenance - Seagate Castle 189,000 1,000 980 Other Property Costs 1,000 255,555 64,804 233,282 Others 5,629 5,629 Administration - Charge from Finance 6,148 5,629 5,629 6,148 261,184 70,433 SUB TOTAL OF EXPENDITURE 239,430 (168,959) 43,712 SURPLUS/(DEFICIT) FOR THE YEAR BEFORE GRANTS (155,555) 26,500 41,041 Available for Disbursement as Grants 41,041 (195,459) 2,671 FINAL SURPLUS/(DEFICIT) FOR THE YEAR INCLUDING GRANTS (196,596) 898,090 1,118,352 COMMON GOOD BALANCE CARRIED FORWARD AT 31 MARCH 921,756 COMMON GOOD FUND - IRVINE 103
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3 | P a g e * For the upkeep of ground at Douglas Park. Budget 2023/24 Projected Outturn 2023/24 Proposed Budget 2024/25 £ £ £ 425,819 431,752 Projected Common Good Balance Brought Forward at 1 April 433,573 INCOME Property Rentals (Including Insurance Premiums) 7,315 7,315 Haylie House 7,315 1,250 1,250 Douglas Park Bowling Club 1,250 210 210 Douglas Park Grazings 210 6,000 6,000 Douglas Park Tennis Club & Children's Nursery 6,539 Other Income 10,650 19,000 Loans Fund Interest (on cash balances) 7,320 25,425 33,775 TOTAL INCOME FOR THE YEAR 22,634 EXPENDITURE Property Costs 5,584 5,300 Electricity 10,976 13,462 13,462 Grounds Maintenance* 14,714 1,000 1,000 Other Property Costs 1,000 Others 2,192 2,192 Administration - Charge from Finance 2,371 22,238 21,954 SUB TOTAL OF EXPENDITURE 29,061 3,187 11,821 SURPLUS/(DEFICIT) FOR THE YEAR BEFORE GRANTS (6,427) 10,000 10,000 Available for Disbursement as Grants 10,000 (6,813) 1,821 FINAL SURPLUS/(DEFICIT) FOR THE YEAR INCLUDING GRANTS (16,427) 419,006 433,573 COMMON GOOD BALANCE CARRIED FORWARD AT 31 MARCH 417,145 COMMON GOOD FUND - LARGS 104
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4 | P a g e Budget 2023/24 Projected Outturn 2023/24 Proposed Budget 2024/25 £ £ £ 66,008 67,433 Projected Common Good Balance Brought Forward at 1 April 68,823 INCOME 1,630 3,020 Loans Fund Interest (on cash balances) 1,150 1,630 3,020 TOTAL INCOME FOR THE YEAR 1,150 EXPENDITURE Others 335 335 Administration - Charge from Finance 378 335 335 SUB TOTAL OF EXPENDITURE 378 1,295 2,685 SURPLUS/(DEFICIT) FOR THE YEAR BEFORE GRANTS 772 1,295 1,295 Available for Disbursement as Grants 5,000 0 1,390 FINAL SURPLUS/(DEFICIT) FOR THE YEAR INCLUDING GRANTS 4,228 66,008 68,823 COMMON GOOD BALANCE CARRIED FORWARD AT 31 MARCH 64,595 COMMON GOOD FUND - MILLPORT Budget 2023/24 Projected Outturn 2023/24 Proposed Budget 2024/25 £ £ £ 15,106 15,213 Projected Common Good Balance Brought Forward at 1 April 14,781 INCOME 350 640 Loans Fund Interest (on cash balances) 230 350 640 TOTAL INCOME FOR THE YEAR 230 EXPENDITURE 73 72 Administration - Charge from Finance 80 73 72 SUB TOTAL OF EXPENDITURE 80 277 568 SURPLUS/(DEFICIT) FOR THE YEAR BEFORE GRANTS 150 1,000 1,000 Available for Disbursement as Grants 5,000 (723) (432) FINAL SURPLUS/(DEFICIT) FOR THE YEAR INCLUDING GRANTS (4,850) 14,383 14,781 COMMON GOOD BALANCE CARRIED FORWARD AT 31 MARCH 9,931 COMMON GOOD FUND - SALTCOATS 105
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5 | P a g e Budget 2023/24 Projected Outturn 2023/24 Proposed Budget 2024/25 £ £ £ 175,310 184,472 Projected Common Good Balance Brought Forward at 1 April 188,342 INCOME Property Rentals 14,250 14,250 New Street (Health & Social Care) 14,250 Other Income 4,380 8,250 Loans Fund Interest (on cash balances) 3,180 18,630 22,500 TOTAL INCOME FOR THE YEAR 17,430 EXPENDITURE 902 902 Administration - Charge from Finance 1,030 902 902 SUB TOTAL OF EXPENDITURE 1,030 17,728 21,598 SURPLUS/(DEFICIT) FOR THE YEAR BEFORE GRANTS 16,400 17,728 17,728 Available for Disbursement as Grants 16,400 0 3,870 FINAL SURPLUS/(DEFICIT) FOR THE YEAR INCLUDING GRANTS 0 175,310 188,342 COMMON GOOD BALANCE CARRIED FORWARD AT 31 MARCH 188,342 COMMON GOOD FUND - STEVENSTON 106
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6 | P a g e Budget 2023/24 Projected Outturn 2023/24 Proposed Budget 2024/25 £ £ £ 1,878 1,903 Projected Trust Balance Brought Forward at 1 April 1,823 INCOME 47 80 Loans Fund Interest (on cash balances) 30 47 80 TOTAL INCOME FOR THE YEAR 30 EXPENDITURE 160 160 Administration - Charge to Finance 168 160 160 SUB TOTAL OF EXPENDITURE FOR THE YEAR 168 (113) (80) SURPLUS/(DEFICIT) FOR THE YEAR BEFORE GRANTS (138) 1,765 0 Available for Disbursement as Grants 1,685 (1,878) (80) FINAL SURPLUS/(DEFICIT) FOR THE YEAR INCLUDING GRANTS (1,823) 0 1,823 TRUST BALANCE CARRIED FORWARD AT 31 MARCH 0 NAC (DALRY) CHARITABLE TRUST Budget 2023/24 Projected Outturn 2023/24 Proposed Budget 2024/25 £ £ £ 2,978 3,010 Projected Trust Balance Brought Forward at 1 April 2,975 INCOME 75 130 Loans Fund Interest (on cash balances) 40 75 130 TOTAL INCOME FOR THE YEAR 40 EXPENDITURE 165 165 Administration - Charge from Finance 174 165 165 SUB TOTAL OF EXPENDITURE FOR THE YEAR 174 (90) (35) FINAL SURPLUS/(DEFICIT) FOR THE YEAR BEFORE GRANTS (134) 2,888 - Available for Disbursement as Grants 2,841 (2,978) (35) FINAL SURPLUS/(DEFICIT) FOR THE YEAR (2,975) 0 2,975 TRUST BALANCE CARRIED FORWARD AT 31 MARCH 0 NAC (KILBIRNIE & GLENGARNOCK) CHARITABLE TRUST 107
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7 | P a g e Budget 2023/24 Projected Outturn 2023/24 Proposed Budget 2024/25 £ £ £ 36,045 37,594 Projected Trust Balance Brought Forward at 1 April 37,618 INCOME 934 1,650 Loans Fund Interest (on cash balances) 630 934 1,650 TOTAL INCOME FOR THE YEAR 630 EXPENDITURE 342 342 Administration - Charge from Finance 386 342 342 SUB TOTAL OF EXPENDITURE FOR THE YEAR 386 592 1,308 SURPLUS/(DEFICIT) FOR THE YEAR BEFORE GRANTS 244 36,637 1,284 Available for Disbursement as Grants 37,862 (36,045) 24 FINAL SURPLUS/(DEFICIT) FOR THE YEAR INCLUDING GRANTS (37,618) 0 37,618 TRUST BALANCE CARRIED FORWARD AT 31 MARCH 0 NAC (KILWINNING) CHARITABLE TRUST Budget 2023/24 Projected Outturn 2023/24 Proposed Budget 2024/25 £ £ £ 3,301 3,328 Projected Trust Balance Brought Forward at 1 April 2,261 INCOME 83 100 Loans Fund Interest (on cash balances) 30 83 100 TOTAL INCOME FOR THE YEAR 30 EXPENDITURE 167 167 Administration - Charge from Finance 176 167 167 SUB TOTAL OF EXPENDITURE FOR THE YEAR 176 (84) (67) SURPLUS/(DEFICIT) FOR THE YEAR BEFORE GRANTS (146) 3,217 1,000 Available for Disbursement as Grants 2,115 (3,301) (1,067) FINAL SURPLUS/(DEFICIT) FOR THE YEAR INCLUDING GRANTS (2,261) 0 2,261 TRUST BALANCE CARRIED FORWARD AT 31 MARCH 0 NAC (LARGS) CHARITABLE TRUST 108
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8 | P a g e Budget 2023/24 Projected Outturn 2023/24 Proposed Budget 2024/25 £ £ £ 8 22 Projected Trust Balance Brought Forward at 1 April 22 INCOME 0 0 Loans Fund Interest (on cash balances) 0 0 0 TOTAL INCOME FOR THE YEAR 0 EXPENDITURE Administration - Charge from Finance 0 0 0 SUB TOTAL OF EXPENDITURE FOR THE YEAR 0 0 0 SURPLUS/(DEFICIT) FOR THE YEAR BEFORE GRANTS 0 8 0 Available for Disbursement as Grants 22 (8) 0 FINAL SURPLUS/(DEFICIT) FOR THE YEAR INCLUDING GRANTS (22) 0 22 TRUST BALANCE CARRIED FORWARD AT 31 MARCH 0 ANDERSON PARK TRUST Budget 2023/24 Projected Outturn 2023/24 Proposed Budget 2024/25 £ £ £ 197,297 197,817 Projected Trust Balance Brought Forward at 1 April 211,661 INCOME 10,130 10,688 Share dividends 10,696 1,093 9,250 Loans Fund Interest (on cash balances) 3,570 11,223 19,938 TOTAL INCOME FOR THE YEAR 14,266 EXPENDITURE 302 444 Administration - Charge from Finance 504 302 444 SUB TOTAL OF EXPENDITURE FOR THE YEAR 504 10,921 19,494 SURPLUS/(DEFICIT) FOR THE YEAR BEFORE GRANTS 13,762 10,921 5,650 Available for Disbursement as Grants 13,762 0 13,844 FINAL SURPLUS/(DEFICIT) FOR THE YEAR INCLUDING GRANTS 0 197,297 211,661 TRUST BALANCE CARRIED FORWARD AT 31 MARCH 211,661 MARGARET ARCHIBALD BEQUEST 109
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9 | P a g e Budget 2023/24 Projected Outturn 2023/24 Proposed Budget 2024/25 £ £ £ 197,297 197,817 Projected Trust Balance Brought Forward at 1 April 211,661 INCOME 10,130 10,688 Share dividends 10,696 1,093 9,250 Loans Fund Interest (on cash balances) 3,570 11,223 19,938 TOTAL INCOME FOR THE YEAR 14,266 EXPENDITURE 302 444 Administration - Charge from Finance 504 302 444 SUB TOTAL OF EXPENDITURE FOR THE YEAR 504 10,921 19,494 SURPLUS/(DEFICIT) FOR THE YEAR BEFORE GRANTS 13,762 10,921 5,650 Available for Disbursement as Grants 13,762 0 13,844 FINAL SURPLUS/(DEFICIT) FOR THE YEAR INCLUDING GRANTS 0 197,297 211,661 TRUST BALANCE CARRIED FORWARD AT 31 MARCH 211,661 MARGARET ARCHIBALD BEQUEST Budget 2023/24 Projected Outturn 2023/24 Proposed Budget 2024/25 £ £ £ 291 306 Projected Trust Balance Brought Forward at 1 April 164 INCOME 7 10 Loans Fund Interest (on cash balances) 0 7 10 TOTAL INCOME FOR THE YEAR 0 EXPENDITURE 152 152 Administration - Charge from Finance 158 152 152 SUB TOTAL OF EXPENDITURE FOR THE YEAR 158 (145) (142) SURPLUS/(DEFICIT) FOR THE YEAR BEFORE GRANTS (158) 146 0 Available for Disbursement as Grants 6 (291) (142) FINAL SURPLUS/(DEFICIT) FOR THE YEAR (164) 0 164 TRUST BALANCE CARRIED FORWARD AT 31 MARCH 0 DOUGLAS SELLERS TRUST 110
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10 | P a g e Budget 2023/24 Projected Outturn 2023/24 Proposed Budget 2024/25 £ £ £ 42,363 44,194 Projected Trust Balance Brought Forward at 1 April 47,644 INCOME 1,885 1,904 Dividends 1,904 1,027 2,080 Loans Fund Interest (on cash balances) 790 2,912 3,984 TOTAL INCOME FOR THE YEAR 2,694 EXPENDITURE 284 284 Administration - Charge from Finance 316 284 284 SUB TOTAL OF EXPENDITURE FOR THE YEAR 316 2,628 3,700 SURPLUS/(DEFICIT) FOR THE YEAR BEFORE GRANTS 2,378 2,628 250 Available for Disbursement as Grants 2,378 0 3,450 FINAL SURPLUS/(DEFICIT) FOR THE YEAR INCLUDING GRANTS 0 42,363 47,644 TRUST BALANCE CARRIED FORWARD AT 31 MARCH 47,644 NORTH AYRSHIRE COUNCIL CHARITABLE TRUST (excluding SPIERS TRUST) 111
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Appendix 2 11 | P a g e Name of Funds Investment Projected Income 2024/25 Available for Disbursement 2024/25 Purpose of Bequest £ £ £ Isabella McPhee Memorial Fund 2,962 50 3,012 Largs - Annual Putting Competition (Mackerston) N Stewart 1,682 28 1,710 Provision of Liberty at Rothesay and Arran Sturrock 3,033 51 3,084 Upkeep of Springside Community Centre Clark Trophy 568 10 577 Road Safety Competition Ayrshire Accident Relief 4,009 68 4,077 Accident Relief Cast/Florist/N Child 290 5 295 No information available Miss Hanslip Bequest 1,195 20 1,215 No information available Total 13,738 232 13,970 Sundry Bequests 112
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NORTH AYRSHIRE COUNCIL 28 February 2024 North Ayrshire Council Title: Treasury Management and Investment Strategy 2024/25 Purpose: To seek approval for the proposed Strategy for Treasury Management and Investment activities within the Council for the financial year 2024/25. Recommendation: That Council approves the Treasury Management and Investment Strategy for 2024/25 as attached at Appendix 1 1. Executive Summary 1.1 The Council is required by regulations issued under the Local Government in Scotland Act 2003 and the Chartered Institute of Public Finance and Accountancy’s Treasury Management in the Public Services: Code of Practice 2021 Edition (the CIPFA Code) to approve a Treasury Management Strategy before the start of each financial year. The Council is also required by regulation to have regard to CIPFA’s Prudential Code for Capital Finance in Local Authorities (2021) under Part 7 of the Local Government in Scotland Act 2003. In addition, the Consent by Scottish Ministers for the Investment of Money by Scottish Local Authorities, which came into force in April 2010, requires the Authority to approve an Investment Strategy before the start of each financial year. 1.2 The Treasury Management and Investment Strategy attached to this report complies fully with these requirements and provides: • a summary of the Council’s capital plans; • an outline of the treasury management strategy in relation to borrowing and the impact of capital plans on this borrowing; and • an outline of the investment strategy including the type of instruments available for investment and our permitted counterparties. 1.3 The strategy provides key prudential and treasury indicators to 2033/34 which clearly articulate the operational parameters associated with Treasury Management and Investment as well as offering assurance in relation to the affordability and sustainability of capital investment plans. Agenda Item 6 113
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1.4 The key points highlighted in this report are; • the continuation of an “under borrowed” position; • interest rate forecasts predict that the UK Bank Rate will begin to decline in the latter half of 2024 and continue to decline until December 2025; • notes the introduction of International Financial Reporting Standard (IFRS)16 which from 1 April 2023 sees leases, which were previously off balance sheet, now being included. Although leases form part of the other long term liability figures which make up the Prudential Indicators, it is not currently anticipated that the Indicators will be exceeded. The full impact will not be known until the end of the financial year 2023/24, an updated report may be required to inform the members of the detailed impact of IFRS 16 with amended Prudential Indicators for approval. 1.5 As recommended under the CIPFA Prudential and Treasury Management Codes, updated performance information in relation to the treasury management and prudential indicators are reported to Cabinet on a quarterly basis as part of the regular Revenue and Capital Monitoring arrangements. 2. Background 2.1 CIPFA defines treasury management as: ‘The management of the local authority’s investments and cash flows, its banking, money market and capital market transactions; the effective control of the risks associated with those activities; and the pursuit of optimum performance consistent with those risks.’ 2.2 The Local Government Scotland Act 2003 and the Prudential Code requires the Council to approve an annual Treasury Management and Investment Strategy which outlines the Council's strategy in relation to borrowing and the Council's strategy for managing investments giving priority to the security and liquidity of those investments. 2.3 The Treasury Management and Investment Strategy 2024/25 is attached at Appendix 1. The overall objectives of the strategy are as follows: Borrowing • to minimise the revenue cost of borrowings; • to manage the Council’s cash flow; • to manage the borrowing repayment profile; • to assess interest rates’ movements and borrow/invest accordingly; • to monitor and review the level of variable rate loans held in order to take advantage of interest rate movements; and • to identify and evaluate opportunities for debt rescheduling. 114
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Investments • to protect capital security of the invested funds; • to obtain the best market return whilst recognising that security and liquidity are key priorities; • to specify criteria for identifying creditworthy counterparties; and • to specify the types of investments permitted and appropriate limits for each. 2.4 The strategy provides detailed key prudential and treasury indicators to 2033/34, aligned to the Councils current capital investment programme, which clearly articulate the operational parameters associated with Treasury Management and Investment as well as offering assurances in relation to the affordability and sustainability of capital investment strategy, including; • the General Services capital plan to 2033/34; and • the Housing Revenue Account Capital Plan to 2053/54 2.5 The strategy also links with the key objectives of the Prudential Code that capital investment programmes: • should be set at a level that delivers the Council’s strategic priorities; and • are affordable in terms of the impact of the resultant debt repayments on revenue budgets. 2.6 The Treasury Management and Investment Strategy includes prudential indicators which are critical in assessing the affordability of capital investment plans and their impact on the Council's overall finances. The indicator used to demonstrate affordability is the proportion of financing costs to the net revenue stream (for both General Fund and Housing Revenue Account). 2.7 There are a number of other key indicators designed to ensure that the Council operates within well-defined limits. The strategy, therefore, specifies: • limits we do not expect external debt to exceed; • appropriate levels of fixed rate borrowing versus variable rate borrowing; • upper and lower limits on the maturity of the debt portfolio, which reduces the Council's exposure to large sums falling due for refinancing at any one time; and • limits on investments placed for more than 365 days. 2.8 The Council expects to hold an 'under-borrowed' position at 31 March 2024. This means that the capital borrowing need (the Capital Financing Requirement) has not been fully funded by debt, due to the level of the Council's internal funds. The use of internal funds instead of borrowing will continue in order to minimise borrowing costs. This under- borrowed position will decline through time as internal funds reduce and borrowing is required to be undertaken to replace internal funding. 115
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2.9 The Treasury Management and Investment Strategy includes details of the Council’s policy on repayment of loans fund advances. The Council’s policy complies with the options currently available under the Local Authority (Capital Financing and Accounting) (Scotland) Regulations 2016 and the asset lives and methodologies used have been reviewed to provide for the prudent repayment of advances. 3. Proposals 3.1 That Council approves the Treasury Management and Investment Strategy for 2024/25 as attached at Appendix 1. 4. Implications/Socio-economic Duty Financial 4.1 Financial implications are detailed in the report attached at Appendix 1. Human Resources 4.2 None. Legal 4.3 The Local Government in Scotland Act 2003 and supporting regulations require the Council to set out its Treasury Strategy for borrowing and to prepare an Annual Investment Strategy. The Local Authority (Capital Financing and Accounting) (Scotland) Regulations 2016 require the Council to set a policy for the repayment of loans fund advances. Equality/Socio-economic 4.4 None. Environmental and Sustainability 4.5 None. Key Priorities 4.6 The Treasury Management Strategy aligns with the Council Plan 2023-28 by ensuring robust governance arrangements are in place to fulfil the Council’s statutory duties, manage risk and support delivery of key priorities. Community Wealth Building 4.7 None. 116
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5. Consultation 5.1 The Council's treasury advisors, Arlingclose Ltd, were consulted in the preparation of the Strategy. Mark Boyd Head of Service (Finance) For further information please contact David Forbes, Senior Manager (Strategic Business Partner), on 01294 324551. Background Papers None 117
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1 | P a g e Treasury Management and Investment Strategy 2024/25 Appendix 1 118
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2 | P a g e Table of Contents 1 Purpose 3 2 Executive Summary 5 3 Capital and Prudential Indicators 2024/25 – 2026/27 7 Capital Expenditure and Financing 7 The Council's Overall Borrowing Need (the Capital Financing Requirement) 8 The Liability Benchmark 9 Limits to Borrowing Activity 10 Affordability Prudential Indicators 11 4 Treasury Management Strategy 12 Interest Rate Forecast 12 Current Portfolio Position 13 Controls on Borrowing Activity 14 LOBOs 15 Policy on Borrowing in Advance of Need 15 Debt Rescheduling 15 Borrowing Sources 15 Policy on Use of Financial Derivative 16 Policy on Repayment of Loans Fund Advances 16 5 Investment Strategy 17 Current Portfolio Position 18 Environmental, Social and Governance (ESG) Policy 18 Creditworthiness Policy 18 Bail-in Risk 19 Investment Strategy and Permitted Investments 20 Summary of Material Investments, Guarantees and Liabilities 21 Monitoring of Investment Strategy 21 Appendices Appendix 1: Prudential Indicators 2028 to 2034 22 Appendix 2: Treasury Risk Register 25 Appendix 3: Permitted Investments, Risks and Mitigating Controls 27 Appendix 4: Policy on Repayment of Loans Fund Advances 32 Appendix 5: Economic Background 34 119
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3 | P a g e 1 Purpose The Council is required by regulations issued under the Local Government in Scotland Act 2003 and the Chartered Institute of Public Finance and Accountancy’s Treasury Management in the Public Services: Code of Practice 2021 Edition (the CIPFA Code) to approve a Treasury Management Strategy before the start of each financial year. The Council is also required by regulation to have regard to CIPFA’s Prudential Code for Capital Finance in Local Authorities (2021) under Part 7 of the Local Government in Scotland Act 2003. In addition, the Consent by Scottish Ministers for the Investment of Money by Scottish Local Authorities, which came into force in April 2010, requires the Authority to approve an Investment Strategy before the start of each financial year. This strategy meets these requirements fully. Three main reports on Treasury Management activity are presented to Members each year, incorporating a variety of policies, estimates and actuals. These are: • Annual Treasury Management and Investment Strategy (this report), which is submitted to full Council before the start of each financial year. • Mid-Year Treasury Management and Investment Report, submitted to Cabinet as soon as possible following 30 September each year. • Annual Treasury Management and Investment Report, submitted to full Council annually by the 30 June following the end of each financial year. Responsibilities Regulations place responsibility on Members for the review and scrutiny of treasury management policy and activities. The following Scheme of Delegation has been adopted by the Council: Full Council • to receive and review reports on treasury management policies, practices and activities; • to approve the annual Treasury Management and Investment Strategy. 120
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4 | P a g e Cabinet • to approve amendments to the treasury management policy statement and treasury management practices; • to approve the division of responsibilities; • to receive and review regular monitoring reports and act on recommendations. Section 95 Officer The Council’s Section 95 Officer is responsible for the proper administration of the Council’s financial affairs and is required: • to recommend treasury management policies / practices, review these regularly and monitor compliance; • to submit regular treasury management updates; • to receive and review management information; • to review the performance of the treasury management function; • to ensure the adequacy of treasury management resources and skills and the effective division of responsibilities within the treasury management function; and • to approve the appointment of external service providers. External Treasury Advisers The Council recognises that there is value in employing external providers of treasury management services, in order to access specialist skills and resources. However, it recognises that the responsibility for treasury management decisions remains with the Council at all times and officers will ensure that undue reliance is not placed upon external advice. The Council’s current external treasury management advisors are Arlingclose Limited. The contract started on 5 April 2021 and was in place for an initial 3 year period. A one year extension has been agreed taking the existing contract to 5 April 2025. The Council will ensure that the terms of their appointment and the methods by which their value is assessed are properly agreed, documented and subject to regular review. 121
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5 | P a g e 2 Executive Summary The treasury management function ensures that the Council’s funds are managed in accordance with the relevant professional codes, so that sufficient cash is available to meet service activity. This involves both the organisation of the cashflow and, where capital plans require, the organisation of approporiate borrowing facilities. CIPFA defines treasury management as: “The management of the organisation’s borrowing, investments and cashflows, including its banking, money market and capital market transactions; the effective control of the risks associated with those activities; and the pursuit of optimum performance consistent with those risks.” This document outlines the Council’s Annual Treasury Management Strategy and Annual Investment Strategy providing: • a summary of the Council’s capital plans; • an outline of the treasury management strategy in relation to borrowing and the impact of capital plans on this borrowing; and • an outline of the investment strategy including the type of instruments available for investment and our permitted counterparties. Key prudential and treasury indicators are provided throughout this strategy which clearly articulate the operational parameters in relation to Treasury Management and Investment, as well as providing assurances in relation to the affordability and sustainability of capital investment plans. Table 1 contains the key prudential and treasury indicators within the report. Table 1 2023/24 2024/25 2025/26 2026/27 Prudential and Treasury Indicators Probable Outturn Estimate Estimate Estimate £m £m £m £m Capital Expenditure: General Services 112.312 104.655 67.937 81.329 HRA 39.730 52.417 75.709 65.552 Total 152.042 157.072 143.646 146.881 Loans Capital Financing Requirement (CFR): General Services 269.594 346.096 372.693 425.982 HRA 180.546 198.552 234.854 264.527 Total 450.140 544.648 607.547 690.509 Gross Borrowing 325.829 478.337 561.236 656.198 Operational Boundary for Borrowing 467.574 558.072 624.121 705.352 Authorised Limit for Borrowing 514.331 613.879 686.533 775.887 Total Operational Boundary (Including PPP/NPD) 555.306 641.366 702.711 779.069 Total Authorised Limit (Including PPP/NPD) 602.063 697.173 765.123 849.604 Liability Benchmark 160.988 258.447 329.296 416.677 Investments 30.000 30.000 30.000 30.000 122
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6 | P a g e A summary of this is provided as follows, with more detailed information provided in the body of the report. Capital Expenditure for the General Fund (GF) reflects the capital investment programme for 2024/25 to 2033/34 and Housing Revenue Account (HRA) reflects the capital investment programme for 2024/25 and the capital investment plans included in the latest business plan. To ensure the financial consequences of the new programme are fully transparent, all relevant indicators have been projected to 2033/34 and these can be found in Appendix 1. The Capital Financing Requirement (CFR) is the underlying borrowing requirements of the Council. Gross Borrowing reflects the actual borrowing which has been undertaken. This is projected to be lower than the CFR as the Council continues with its strategy to use internal funds. The Operational Boundary is the maximum borrowing and other long-term liabilities to fund previous years’ and the current year capital programme, building in flexibility for the timing of the different funding streams and principal repayments. The operational boundary includes any other long-term liabilities (e.g. PPP/NPD schemes, finance leases) however no borrowing is actually required against these schemes as a borrowing facility is included in the contract. The Authorised Limits is set at 10% above the Operational Boundary to give some flexibility around raising funds for future year capital investment. The Liability Benchmark is an estimate of the cumulative amount of external borrowing the Council must hold to fund its current capital and revenue plans while keeping treasury investments at the minimum level required to manage day-to-day cash flow. Affordability of borrowing is measured by the percentage of financial costs relative to the net revenue stream of the GF and HRA. Full details of these can be found on page 11. The average investment rate estimated for 2024/25 is 4.25% and is reflective of the Council’s appetite for risk, the short term nature of investments and the permitted instruments and counterparties selected. Other prudential and treasury indicators and supporting information can be found in the main body of this report. Client Status The second Market in Financial Instruments Directive (MiFID II), introduced in January 2018, classifies Local Authorities as “retail clients” unless they choose to opt-up to “professional client” status. This has the advantages of lower fees and access to a greater range of products and investment firms. The Council continues to opt-up to professional client status. In order to meet the professional client criteria, the Council must hold a £10m investment portfolio at all times and have at least one officer with the necessary level of experience and knowledge to understand the risks involved in the management of the investments. 123
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7 | P a g e 3 Capital and Prudential Indicators 2024/25 – 2026/27 In exercising its power to borrow, the Local Authority (Capital Finance and Accounting) (Scotland) Regulations 2016 require the Authority to have regard to the Chartered Institute of Public Finance and Accountancy’s Prudential Code for Capital Finance in Local Authorities (the Prudential Code). The Prudential Code is a framework to ensure Councils demonstrate effective control over levels of, and decisions relating to, capital investment activity, including borrowing. The Treasury indicators are used to ensure that risk is managed and controlled effectively. Together the Prudential and Treasury Indicators consider the affordability and impact of capital expenditure decisions and set out the Council’s overall capital framework. Capital Expenditure and Financing This prudential indicator is a summary of the Council’s capital expenditure plans, both those agreed previously and those forming part of the 2024/25 budget setting. The 2024/25 budget proposes an updated Capital Investment Programme for General Services to 2033/34 and updated investment plans for the HRA for 2024/25 and the capital investment plans included in the latest business plan. All projects within the Capital Programme are linked to the Council’s key strategic priorities. These are also covered in the Capital Investment Strategy, produced in line with the requirements of the Prudential Code. To ensure that the financial consequences of the new programme are fully transparent, all relevant indicators have been projected to 2033/34 and these can be found in Appendix 1. Table 2 shows the capital expenditure plans and how they are being financed by capital or revenue resources over the next three years. The borrowing figure in Table 2 is the difference between the estimates for total capital expenditure and the other funding sources. Table 2 2023/24 2024/25 2025/26 2026/27 Probable Outturn Estimate Estimate Estimate £m £m £m £m General Services Capital expenditure 112.312 104.655 67.937 81.329 Funded by: Borrowing 51.246 78.300 29.586 55.833 Receipts / Grants 59.661 22.875 37.647 24.786 Funded from Revenue 1.405 - - - Funded from Reserves - 3.480 0.704 0.710 Total 112.312 104.655 67.937 81.329 HRA Capital expenditure 39.730 52.417 75.709 65.552 Funded by: Borrowing 21.284 24.116 43.279 37.306 Receipts / Grants 6.785 15.871 21.483 16.868 Funded from Revenue 5.151 11.492 9.010 7.422 Funded from Reserves 6.510 0.938 1.937 3.956 Total 39.730 52.417 75.709 65.552 Estimates of Capital Expenditure and Income 124
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8 | P a g e The Council’s Overall Borrowing Need (the Capital Financing Requirement) This indicator outlines the Council’s Capital Financing Requirement (CFR). The CFR is simply the total historic outstanding capital expenditure which has not been paid from either a capital or a revenue resource and, therefore, needs to be funded from borrowing. It is essentially a measure of the Council’s underlying borrowing need. Part of the Council’s treasury activity is to meet the funding requirements for this borrowing need. The treasury management section organises the Council’s cash position to ensure that sufficient cash is available to meet the capital plans and cash flow requirements. This may be sourced through borrowing from external bodies (such as the Government, through the Public Works Loan Board [PWLB], or the money markets), or utilising temporary cash resources within the Council. The Council’s underlying borrowing need (CFR) is not allowed to rise indefinitely. The Council is required to make an annual revenue charge, called the Loans Fund Principal Repayment. This is effectively a repayment of the borrowing need and it is charged to revenue over the life of the asset. This charge reduces the CFR each year. This differs from the treasury management arrangements, which ensure that cash is available to meet the payment of capital commitments on an ongoing basis. External debt can also be borrowed or repaid at any time, but this does not change the CFR. The total CFR can also be reduced by: • the application of additional capital financing resources (such as unapplied capital receipts); or • increasing the annual revenue charge. The Council’s CFR is shown below and is a key prudential indicator. The opening balances include the PPP/NPD schemes on the balance sheet, which increase the Council’s borrowing need. This is shown to give a complete picture of the Council’s debt. However, no borrowing is actually required against these schemes as a borrowing facility is included in the contract and, as such, this is subtracted from the total CFR to identify the Loans CFR. The Loans CFR is forecast to rise over the next few years as capital expenditure financed by borrowing increases. Table 3 2023/24 2024/25 2025/26 2026/27 Probable Outturn Estimate Estimate Estimate £m £m £m £m General Services 357.326 429.390 451.283 499.699 HRA 180.546 198.552 234.854 264.527 Sub-total 537.872 627.942 686.137 764.226 Less PPP/NPD long-term liability (87.732) (83.294) (78.590) (73.717) Loans Capital Financing Requirement (CFR) 450.140 544.648 607.547 690.509 Movement in CFR General Services 76.502 26.597 53.289 HRA 18.006 36.302 29.673 Annual Change 94.508 62.899 82.962 Capital Financing Requirement (CFR) 125
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9 | P a g e Liability Benchmark The liability benchmark, which is now a treasury prudential indicator, is an important tool to help establish whether the Council is likely to be a long-term borrower or long-term investor in the future, and so shape its strategic focus and decision making. The liability benchmark itself represents an estimate of the cumulative amount of external borrowing the Council must hold to fund its current capital and revenue plans while keeping treasury investments at the minimum level required to manage day-to-day cash flow. Table 4 Following on from the medium-term forecasts in the table above, the long-term liability benchmark assumes capital expenditure funded by borrowing will be in line with the 10 year capital plan and 30 year HRA business plan respectively, loans fund advances on new capital expenditure based on asset life and income, expenditure and reserves all increasing by inflation of 2.5% a year with any specific adjustments made for planned use of reserves. This is shown in the chart below together with the maturity profile of the Council’s existing borrowing: 2022/23 2023/24 2024/25 2025/26 2026/27 Actual £m Estimate £m Forecast £m Forecast £m Forecast £m Loans CFR 384.1 450.1 544.6 607.5 690.5 Less Balance sheet resources -252.2 -299.2 -296.2 -288.3 -283.8 Net loans requirement 131.881 150.988 248.447 319.296 406.677 Liquidity allowance 10.0 10.0 10.0 10.0 10.0 Liability Benchmark 141.881 160.988 258.447 329.296 416.677 Liability Benchmark 126
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10 | P a g e The Liability benchmark graph above is used to inform the Council’s borrowing strategy. The shaded grey area shows the Councils current debt and the gap between this and the Liability benchmark line is how much more borrowing the Council likely needs to undertake to support its current capital plans once taking into account its balance sheet resources. The above graph indicates that long term borrowing for the period of up to 25 years would be most appropriate to meet the Councils borrowing needs and mitigate against interest rate risk. Limits to borrowing activity The Operational Boundary The operational boundary is the expected maximum borrowing position of the Council during the year, taking account of the timing of various funding streams and the recharge of principal repayments from the revenue account. Periods where the actual position varies from the boundary are acceptable, subject to the authorised limit not being breached. The Authorised Limit The authorised limit represents a limit beyond which external debt is prohibited. This limit is set by Council and can only be revised by Council approval. It reflects the level of external borrowing which, while not desirable, could be afforded in the short term, but is not sustainable in the longer. The current limit is set at 10% above the Operational Boundary. The following graph shows the projected levels of the Operational Boundary and Authorised Limit for Borrowing, compared with the Council’s CFR and gross debt position. CIPFA’s Prudential Code for Capital Finance in Local Authorities recommends that the Council’s total debt should not exceed the highest forecast CFR over the next three years. This provides Councils with some flexibility to borrow to meet future capital investment requirements but provides a balance to ensure debt is not held for long periods of time without an underlying need to fund capital investment. The graph below confirms that the Council expects to comply with this recommendation. *NB: Figures exclude PPP/NPD 127
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11 | P a g e Leasing – International Financial Reporting Standard (IFRS) 16 From 1 April 2023, leases which were previously off balance sheet will now be included. Although leases form part of the other long term liability figures which make up the Prudential Indicators above, it is not currently anticipated that the Indicators will be exceeded. The full impact will not be known until the end of the financial year 2023/24, an updated report may be required to inform the members of the detailed impact of IFRS 16 with amended Prudential Indicators for approval. Affordability Prudential Indicators These Prudential Indicators assess the affordability of capital investment plans and provide an indication of the impact of capital investment plans on the Council’s overall finances. The cost impact of borrowing decisions are reflected in the Council’s budget as loan charges. These have been projected to 2033/34 in line with the capital plan. Actual and estimates of the proportion of financing costs to net revenue stream. This indicator identifies the trend in the cost of capital (borrowing and other long-term liabilities net of investment income) against the net revenue stream and reflects the profile of the loans fund advances together with future capital investment. The estimates of financing costs include current commitments and those arising from the capital programme. The HRA costs are aligned with the 30-year business plan. Table 5 Capital expenditure impacts on the revenue budget through financing charges, so it is essential that the Council ensures the financing costs remain affordable and do not constitute an excessive proportion of the revenue resources available. From a General Fund perspective, the CIPFA Directors of Finance Performance Indicators 2022/23 show a Scottish Local Authority average of 5.4%, therefore demonstrating a prudent borrowing policy. For the HRA, the indicative Scottish average in 2022/23 was 21.4%. The rising ratio within the HRA is indicative of the significant capital investment programme as outlined in the Strategic Housing Investment Plan. The level of loan charges is deemed prudent and affordable within the framework of the 30 year Housing business plan. 2023/24 2024/25 2025/26 2026/27 Probable Outturn Estimate Estimate Estimate % % % % General Services 2.5% 3.5% 4.4% 4.9% HRA 20.5% 24.0% 28.7% 30.5% Proportion of financing costs to net revenue stream 128
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12 | P a g e 4 Treasury Management Strategy The treasury management function ensures that the Council’s funds are managed in accordance with the relevant professional codes, so that sufficient cash is available to meet service activity. This involves both the organisation of the cashflow and, where capital plans require, the organisation of approporiate borrowing facilities. The strategy covers the relevant treasury / prudential indicators, the current and projected debt positions and the annual investment strategy. The primary objectives of the Council’s borrowing strategy is to minimise the revenue impact of borrowing and to effectively manage the repayment profile of the debt. The treasury strategy aligns with the Council Plan by contributing to “maximising financial flexibilities to help support delivery of priorities” and “Maximising value from the use of our assets” as referred to under the priority of “A Sustainable Council”. The Council Plan can be found on the Council’s website at: www.north-ayrshire.gov.uk. Economic Outlook Interest rate forecast Interest rate forecasts are key to forecasting the costs of future borrowing. The Council’s treasury management adviser Arlingclose is forecasting that the bank rate will begin to decline in the latter half of 2024 and continue to decline until December 2025 before settling at 3%. The projected rates are shown in the following graph alongside an assessment of PWLB borrowing rates to December 2026: 129
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13 | P a g e Current Portfolio Position The Council’s projected treasury portfolio position at 31 March 2024, with future year estimates, is summarised below. Table 6 shows the probable outturn of gross debt at 31 March 2024, and the estimated gross debt 2024/25 – 2026/27, against the underlying capital borrowing need (the CFR) highlighting any over or under borrowing. Both the external debt and CFR exclude the Council’s liabilities in respect of the PPP/NPD schemes. Table 6 Within the prudential indicators there are a number of key indicators to ensure that the Council operates within well-defined limits. One of these is that the Council’s gross debt should not, except in the short term, exceed the total of the CFR. This allows some flexibility for limited early borrowing for future years but ensures that borrowing is not undertaken for revenue purposes. The Council’s borrowing strategy continues to address the key issue of affordability without compromising the longer-term stability of the debt portfolio. The Council is currently under- borrowed. This means that the capital financing requirement (CFR), has not been fully funded with loan debt because the cash supporting the Council’s internal balances and cashflow is being used as a temporary measure. This strategy is currently prudent, as investment returns are low and counterparty risk is high. Where possible, the Council will continue to use internal funds but will balance this strategy against movements in interest rates as outlined above. Against this background and the risks within the economic forecast, caution will be adopted within 2024/25 treasury operations. The Section 95 Officer will monitor interest rates and adopt a pragmatic approach to changing circumstances. For example: • if it is anticipated that there is a significant risk of a sharp fall in long and short-term rates, then long-term borrowings will be postponed and potential rescheduling from fixed rate funding into short-term borrowing will be considered. • if it is anticipated that there is a significant risk of a sharp rise in long and short-term rates than that currently forecast, then the portfolio position will be re-appraised with the likely action that fixed rate funding will be drawn whilst interest rates are still lower than they are expected to be in the next few years. Any such decisions will be reported to the Cabinet as part of the mid-year and annual treasury outturn report. A summary of treasury risks and mitigating controls can be found at Appendix 2. 2023/24 2024/25 2025/26 2026/27 Probable Outturn Estimate Estimate Estimate £m £m £m £m Gross Debt at 31 March 325.829 478.337 561.236 656.198 CFR 450.140 544.648 607.547 690.509 (Under)/Over Borrowed Position (124.311) (66.311) (46.311) (34.311) Current Portfolio Position (excluding PPP/NPD) 130
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14 | P a g e Controls on Borrowing Activity The purpose of these controls is to manage the risk and impact of any adverse movement in interest rates. However, if they are set to be too restrictive, they may impair opportunities to reduce costs / improve performance. The indicators are: • Upper limits on variable interest rate exposure. This identifies a maximum limit for variable interest rates based upon the debt position net of investments; • Upper limits on fixed interest rate exposure. This is similar to the previous indicator and covers a maximum limit on fixed interest rates. Table 7 • Maturity structure of borrowing. These gross limits are set to reduce the Council’s exposure to large sums falling due for refinancing; both upper and lower limits are required. Table 8 * Note the Under 12 months figure in the above table includes £38.950m LOBOs which have call options in year. The impact of a 1% rise in interest rates based on the Councils current debt portfolio is shown in the table below: Table 9 *Note there is a lower impact of a 1% reduction as the LOBO loans are unlikely to be called when the rate reduces. 2023/24 2023/24 2024/25 2025/26 2026/27 Probable Outturn Limit Limit Limit Limit £m £m £m £m £m Limits on fixed interest rates based on net debt 274.879 514.331 613.879 686.533 775.887 Limits on variable interest rates based on net debt 50.950 60.000 60.000 60.000 60.000 2023/24 2023/24 Lower Upper Probable Outturn Probable Outturn Limit Limit £m % % % Under 12 months 53.428 18% 0% 50% 12 months and within 24 months 2.888 1% 0% 50% 24 months and within 5 years 10.032 3% 0% 50% 5 years and within 10 years 24.439 8% 0% 75% 10 years and above 208.152 70% 25% 90% Total Borrowing 298.938 100% Maturity Profile of Borrowing 2024/25 2025/26 2026/27 £m £m £m Impact of1% increase in Interest rates 0.420 0.561 0.604 Impact of1% decrease in Interest rates (0.191) (0.302) (0.344) Interest rate Risk Exposure 131
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15 | P a g e LOBOs The Council currently holds £50.950m of Lender’s Option Borrower’s Option (LOBO) loans where the lender has the option to propose an increase in the interest rate at set dates, following which the Council has the option to either accept the new rate or to repay the loan at no additional cost. Similar to other debt held by the Council we continue to work with treasury management advisers to identify financially beneficial opportunities to repay LOBO loans. Policy on Borrowing in Advance of Need The Council will not borrow more than, or in advance of, its needs purely to profit from the investment of the extra sum borrowed. Any decision to borrow in advance will be within forward approved CFR estimates and will be considered carefully to ensure that value for money can be demonstrated and that the Council can ensure the security of such funds. Risks associated with any advance borrowing activity will be subject to appraisal and subsequent reporting in either the mid-year or annual treasury report. Debt Rescheduling As short-term borrowing rates are cheaper than longer term fixed interest rates, there may be potential opportunities to generate savings by switching from long-term to short-term debt. However, these savings will need to be considered in the light of the current treasury position and the cost of any premiums incurred on early debt repayment. Potential reasons for debt rescheduling include: • the generation of cash savings and / or discounted cashflow savings; or • the enhancement of the portfolio balance (amend the maturity profile and / or risk). The recent rise in interest rates means that more favourable debt rescheduling opportunities should arise than in previous years. All debt rescheduling proposals will be reported to Cabinet / full Council as part of the annual or mid-year report. Borrowing Sources Approved sources of long-term and short-term borrowing are: • HM Treasury’s PWLB lending facility (formerly the Public Works Loan Board) and any successor body; • UK Infrastructure Bank Ltd • Any institution approved for investments (see Appendix 3); • Any other bank or buiding society authorised to operate in the UK; • Any other UK public sector body; • UK public and private sector pension fund (except Strathclyde Pension Fund); • Capital market bond investors; or 132
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16 | P a g e • UK Municipal Bonds Agency plc and other special purpose companies created to enable local authority bond issues. In addition, capital finance can be raised by the following methods that are not borrowing, but are classed as other debt liabilities: • Leases; • Hire purchase; • Private Finance Initiatives (including PPP/NPD); or • Sale and leaseback arrangements. • Similar asset based finance Alternatives to PWLB North Ayrshire Council has previously raised the majority of its long-term borrowing from the PWLB but will consider long-term loans from other sources including banks, pensions and local authorities. The Council will also investigate the possibility of issuing bonds and similar instruments, which may offer lower interest costs and reduce over-reliance on one source of funding in line with the CIPFA Code. One example of such funding is the UK Municipal Bonds Agency, an organisation which issues bonds on the capital markets and lends the proceeds to local authorities. As these will represent a more complex form of borrowing, any decision to borrow in this way will be the subject of a separate report to Council. PWLB loans are no longer available to local authorities planning to buy investment assets primarily for yield. The Council therefore intends to avoid this activity in order to retain its access to PWLB loans. Policy on Use of Financial Derivatives A financial derivative is a contract, which derives its value from the performance of an underlying entity. They are used for a number of purposes, including insuring against price movements. In the absence of any explicit legal power to do so, the Council will not use standalone financial derivatives (such as swaps, forwards, future and options). Derivatives embedded into loans and investments, including pooled funds and forward starting transactions, may be used and the risks that they present will be managed in line with the overall treasury risk management strategy. Policy on Repayment of Loans Fund Advances The prudent repayment of Loans Fund Advances are made under the provisions of The Local Authority (Capital Finance and Accounting) (Scotland) Regulations 2016, which came into force on 1 April 2016. These Regulations require North Ayrshire Council to outline its policy on the repayment of loans fund advances. The loans fund advance is effectively the repayment of the ‘principal’ linked to the capital expenditure which is funded from borrowing. 133
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17 | P a g e The statutory guidance identifies a number of options for the prudent repayment of advances, including basing the repayments on: • the depreciation charges made against the assets; • the life of the assets, using either the annuity or equal instalments methodology; or • the funding or income streams attached to the assets. For the majority of projects undertaken by the Council, the policy is to repay loans fund advances linked to asset life using the annuity methodology. However, where appropriate, the repayment of advances arising from projects with associated income streams will be matched to the profile of the income. The Council will continue to consider the most appropriate repayment methods, which align to the benefits of the assets and ensure a prudent repayment, for existing and future advances. The policy is outlined in full in Appendix 4. 5 Investment Strategy The Council’s investment strategy has regard to the Local Government Investment (Scotland) Regulations (and accompanying finance circular) and the 2021 revised CIPFA Treasury Management in Public Services Code of Practice and Cross Sectoral Guidance Notes (“the CIPFA TM Code”). The Council’s objective when investing money is to strike an appropriate balance between risk and return, minimising the risk of incurring losses from defaults or of receiving unsuitably low investment income. The Council aims to be a responsible investor and will consider environmental, social and governance (ESG) issues when investing. The aim of the Investment Strategy is to provide security of investment and minimisation of risk by generating a list of high creditworthy counterparties which will enable diversification. Investment instruments identified for use in the financial year, along with their associated risks and controls can be found in Appendix 3. Counterparty limits are set through the Council’s Treasury Management Practices. The maximum that will be lent to any one organisation (other than the UK Government) will be £10 million. A group of banks under the same ownership, will be treated as a single organisation for limit purposes. The Council uses purpose-built cash flow forecasting software to determine the maximum period for which funds may prudently be committed. The forecast is compiled on a prudent basis to minimise the risk of the Council being forced to borrow on unfavourable terms to meet its financial commitments. Limits on long-term investments are set by reference to the Council’s revenue budget and cash flow forecast. Given the risk of bail-in (as defined on page 19) and continued low returns from short-term unsecured bank investments, the Council will take opportunities, as cash flows permit, to further diversify into more secure asset classes during 2024/25. This diversification will mitigate further risks associated with investments. 134
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18 | P a g e Current Portfolio Position Table 10 Environmental, Social and Governance (ESG) Policy Environmental, social and governance (ESG) considerations are increasingly a factor in global investors’ decision making, but the framework for evaluating investment opportunities is still developing and therefore the Council’s ESG policy does not currently include ESG scoring or other real-time ESG criteria at an individual investment level. When investing in banks and funds, the Council will prioritise banks that are signatories to the UN Principles for Responsible Banking and funds operated by managers that are signatories to the UN Principles for Responsible Investment, the Net Zero Asset Managers Alliance and/or the UK Stewardship Code. A list of ESG Initiative signatories is updated quarterly by the Council’s treasury advisor Arlingclose to support the Council’s decision making process for investing. Creditworthiness policy In accordance with the above, and in order to minimise risk, the Council has clearly stipulated the minimum acceptable credit quality of counterparties for inclusion on its lending list. The Council uses Arlingclose’s Approved Counterparties List which takes full account of the ratings, outlooks and watches published by all three ratings agencies. Ratings are monitored on a real time basis with any changes notified electronically supplemented by weekly update. Investment decisions are made by reference to the lowest published long-term credit rating and analysis from the Council’s treasury management advisers. The Council considers high credit quality organisations and investments as those having a credit rating of A- or higher and which are domiciled in the UK or in a foreign country with a sovereign rating of AA+ or higher. For money market funds that are more diversified, “high credit quality” is defined as those having a credit rating of A- or higher. However, in addition to credit ratings, the Council will consider investments in organisations based on independent analysis from our treasury management advisors. All credit ratings are monitored by the Treasury Team who are alerted to changes in ratings of the main rating agencies through Arlingclose’s weekly updates and following credit developments. Where a downgrade results in the counterparty or investment scheme no longer meeting the Council’s minimum criteria, any investment will be withdrawn immediately, where breakage costs are not excessive. 2023/24 2024/25 2025/26 2026/27 Probable Outturn Estimate Estimate Estimate £m £m £m £m Investments at 31 March 30.000 30.000 30.000 30.000 Net Debt at 31 March 295.829 448.337 531.236 626.198 Current Portfolio Position 135
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19 | P a g e When deteriorating financial market conditions affect the creditworthiness of all organisations, as happened in 2008, 2020 and 2022, this is not generally reflected in credit ratings, but can be seen in other market measures. In these circumstances, the Council will restrict its investments to those organisations of higher credit quality and reduce the maximum duration of its investments to maintain the required level of security. The extent of these restrictions will be in line with prevailing financial market conditions. If these restrictions mean that insufficient commercial organisations of high credit quality are available to invest the Council’s cash balances, then the surplus will be deposited with the UK Government, or with other local authorities. This will cause investment returns to fall but will protect the principal sum invested. The Council recognises that credit ratings are good, but not comprehensive, indicators of investment default. Full regard is therefore given to other available information on the credit quality of the organisations in which it invests including credit default swap prices, financial statements, information on government support, reports in the financial press and analysis from the Council’s treasury management adviser. No investment will be made with an organisation if there are substantive doubts about its credit quality, even though it may otherwise meet the above criteria. Bail-in Risk Since the financial crisis, global authorities have embarked on a wide ranging review of the banking sector to ensure that the cost to the public purse of any future crises is contained. One of the most significant changes has arisen from the Financial Services (Banking Reform) Act 2013 which added the bail-in of certain unsecured creditors to the Special Resolution Regime (SRR) granted to the Bank of England under the Banking Act 2009. Bail-in is the opposite of bail-out and requires the country’s banking authority to bail-in funds from existing investments if a bank requires it to remain financially sustainable. Local authority deposits in banks are unsecured and because other previously unsecured creditors such as retail investors have become preferred under UK and EU Directives, it means that the risks associated with local authority unsecured investments in banks have risen. The best solution to mitigating against bail-in risk is to invest with high quality and credit worthy institutions. The identification of these institutions remains a key objective of the investment strategy. Ensuring diversification of investment counterparties is also an effective risk management approach and is reflected in investment counterparty limits. 136
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20 | P a g e Investment Strategy and Permitted Investments The Investment Regulations (Code on the Investment of Money by Local Authorities) require the Council to approve all types of investments to be used and to set appropriate limits for the amount that can be held in each investment type. In determining its permitted investments, the Council must identify the treasury risks associated with each type of instrument and the controls put in place to limit risk on each investment type. Full details can be found in Appendix 3. Investment Returns Expectations The Bank Rate is forecast to gradually fall during the second half of 2024 and continue with gradual reductions until December 2025. Bank Rate forecasts for financial year ends (March) are: • 2024/25 4.25% • 2025/26 3.00% • 2026/27 3.00% The estimated rates for returns on investments placed for periods up to 100 days during each financial year for the next three years are as follows: • 2023/24 4.25% • 2024/25 3.00% • 2025/26 3.00% Investment Treasury Indicator and Limit This is a control on the total principal funds invested for greater than 1 year. This limit is set with regard to the Council’s liquidity requirements and to reduce the need for early sale of an investment, and is based on the availability of funds after each year-end. Table 11 For cashflow management, the Council will seek to utilise its money market funds and short- dated deposits (overnight to three months) in order to benefit from the compounding of interest. 2023/24 2024/25 2025/26 2026/27 Probable Outturn £m Limit £m Limit £m Limit £m Principal sums invested for more than 1 year - 10.000 10.000 10.000 Maximum principal sums invested for more than 1 year 137
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21 | P a g e Summary of Material Investments, Guarantees and Liabilities In line with the requirements in respect of the Council’s Capital Investment Strategy information is provided on material Investments, Guarantees and Liabilities. Reporting of this fits better within the TMIS. Information is provided in the table below; The Council has the current historic investments on the balance sheet as at 31st March 2023: Category Value as at 31 March 2023 £m Long-term Debtors 0.044 Total 0.044 The long-term debtors represent loan finance provided by the Council to other parties which relates to Advances for House Purchases. Monitoring of Investment Strategy An update on the investment position of the Council will be reported to Cabinet in the 2024/25 Mid-Year Treasury report and the Annual Treasury Report will be submitted to the Council after the end of the financial year. 138
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22 Appendix 1: Prudential Indicators 2028 to 2034 * A negative annual change in CFR reflects a reduction in the need to finance capital investment from borrowing. 2027/28 2028/29 2029/30 2030/31 2031/32 2032/33 2033/34 Estimate Estimate Estimate Estimate Estimate Estimate Estimate £m £m £m £m £m £m £m General Services Capital expenditure 62.793 26.625 21.326 11.047 10.249 10.249 10.249 Funded by: Borrowing 35.284 8.753 5.668 1.267 0.594 0.594 0.594 Receipts / Grants 27.509 17.872 15.658 9.780 9.655 9.655 9.655 Funded from Revenue - - - - - - - Funded from Reserves - - - - - - - Total 62.793 26.625 21.326 11.047 10.249 10.249 10.249 HRA Capital expenditure 80.075 46.543 25.272 24.382 24.928 25.792 26.804 Funded by: Borrowing 62.024 33.999 11.881 11.435 10.260 10.366 9.211 Receipts / Grants 8.466 1.566 0.588 0.004 - - - Funded from Revenue 9.585 10.978 12.803 12.943 14.668 15.426 17.593 Funded from Reserves - - - - - - - Total 80.075 46.543 25.272 24.382 24.928 25.792 26.804 2027/28 2028/29 2029/30 2030/31 2031/32 2032/33 2033/34 Estimate Estimate Estimate Estimate Estimate Estimate Estimate £m £m £m £m £m £m £m General Services 526.200 526.243 523.368 515.233 505.572 494.885 482.934 HRA 320.543 348.064 353.599 357.152 359.314 360.353 360.299 Sub-total 846.743 874.307 876.967 872.385 864.886 855.238 843.233 Less PPP/NPD long-term liability (68.023) (62.547) (56.667) (50.841) (44.793) (38.127) (29.984) Sub-total 778.720 811.760 820.300 821.544 820.093 817.111 813.249 Movement in CFR General Services 32.195 5.519 3.005 (2.309) (3.613) (4.021) (3.808) HRA 56.016 27.521 5.535 3.553 2.162 1.039 (0.054) Annual Change 88.211 33.040 8.540 1.244 (1.451) (2.982) (3.862) Estimates of Capital Expenditure and Income Capital Financing Requirement (CFR) 139
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23 2027/28 2028/29 2029/30 2030/31 2031/32 2032/33 2033/34 Estimate Estimate Estimate Estimate Estimate Estimate Estimate £m £m £m £m £m £m £m General Services 5.4% 5.8% 5.7% 5.9% 6.0% 6.0% 5.9% HRA 30.6% 31.6% 30.8% 31.8% 30.8% 31.1% 29.8% 2027/28 2028/29 2029/30 2030/31 2031/32 2032/33 2033/34 Current Portfolio Position Estimate Estimate Estimate Estimate Estimate Estimate Estimate (excluding PPP/NPD) £m £m £m £m £m £m £m Gross Debt at 31 March 744.409 777.449 785.989 787.233 785.782 782.800 778.938 CFR 778.720 811.760 820.300 821.544 820.093 817.111 813.249 (Under)/Over Borrowed Position (34.311) (34.311) (34.311) (34.311) (34.311) (34.311) (34.311) 2027/28 2028/29 2029/30 2030/31 2031/32 2032/33 2033/34 Estimate Estimate Estimate Estimate Estimate Estimate Estimate £m £m £m £m £m £m £m Investments at 31 March 20.000 20.000 20.000 20.000 20.000 20.000 20.000 Net Debt at 31 March 724.409 757.449 765.989 767.233 765.782 762.800 758.938 2027/28 2028/29 2029/30 2030/31 2031/32 2032/33 2033/34 Estimate Estimate Estimate Estimate Estimate Estimate Estimate £m £m £m £m £m £m £m Anticipated borrowing 791.587 822.023 829.897 833.131 832.398 831.053 826.916 PPP/NPD long-term liability 68.023 62.547 56.667 50.841 44.793 38.127 29.984 Operational Boundary 859.610 884.570 886.564 883.972 877.191 869.180 856.900 2027/28 2028/29 2029/30 2030/31 2031/32 2032/33 2033/34 Estimate Estimate Estimate Estimate Estimate Estimate Estimate £m £m £m £m £m £m £m Operational Boundary + 10% 870.746 904.225 912.887 916.444 915.638 914.158 909.608 PPP/NPD long-term liability 68.023 62.547 56.667 50.841 44.793 38.127 29.984 Authorised Limit 938.769 966.772 969.554 967.285 960.431 952.285 939.592 Proportion of financing costs to net revenue stream Current Portfolio Position Authorised Limit Operational Boundary 2027/28 2028/29 2029/30 2030/31 2031/32 2032/33 2033/34 Estimate Estimate Estimate Estimate Estimate Estimate Estimate £m £m £m £m £m £m £m Loans CFR 778.703 811.758 820.298 821.542 820.091 817.109 813.247 Less Balance sheet resources (79.143) (80.754) (82.914) (86.815) (91.078) (95.174) (99.326) Net loans requirement 699.560 731.004 737.384 734.727 729.013 721.935 713.921 Liquidity allowance 10.250 10.506 10.769 11.038 11.314 11.597 11.887 Liability Benchmark 709.810 741.510 748.153 745.765 740.327 733.532 725.808 Liability Benchmark 140
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25 Appendix 2: Treasury Risk Register Risk Title Description Consequence of Risk Current Controls RAG Status Credit and Counterparty Risk This is the risk of failure by a counterparty (bank or building society) to meet its contractual obligations to the organisation particularly due to the counterparty’s diminished creditworthiness, and the resulting detrimental effect on the organisation’s capital or current (revenue) resources. There are no counterparties where this risk is zero although AAA rated organisations have a very high level of creditworthiness. That investment funds will not be returned in full to the Council as per the contractual obligation of the counterparty. The Council sets minimum credit criteria to determine which counterparties and countries are of sufficiently high creditworthiness to invest securely. The RAG status is Amber because this risk will never be fully eliminated. Amber Liquidity Risk This is the risk that cash will not be available when it is needed. Whilst it could be said that all counterparties are subject to at least a very small level of liquidity risk, in this document, liquidity risk has been treated as whether or not instant access to cash can be obtained from each form of investment instrument. While some forms of investment e.g. gilts, Certificates of Deposit, corporate bonds can usually be sold immediately if the need arises, there are two caveats: - a) cash may not be available until a settlement date up to three days after the sale; and b) there is an implied assumption that markets will not freeze up and so the instrument in question will find a ready buyer. That the Council has insufficient access to cash to enable it to carry out its activities. The Council has a cash flow forecasting model to enable it to determine how long investments can be made for and how much can be invested. This has a high level of assurance around regular cash inflows and outflows. Some of the Council’s cashflow related investments are invested in Money Market Funds which provide very high daily liquidity. Green 142
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26 Risk Title Description Consequence of Risk Current Controls RAG Status Market Risk This is the risk that, through adverse market fluctuations in the value of the sums that the Council borrows and invests, there is a detrimental impact on the Council. That investment funds will not be returned in full to the Council as per the contractual obligation of the counterparty due to market variations. Only a proportion of the Council’s investments will be invested in instruments whose value are subject to market movements. The proportion will not exceed the maximum percentage the Council will invest in investments over 1 year Green Interest Rate Risk This is the risk that fluctuations in the levels of interest rates create an unexpected or unbudgeted burden on the organisation’s finances, against which the organisation has failed to protect itself adequately. The Council has set limits for its fixed and variable rate exposure in its Treasury Indicators in this report That the Council will be faced with unexpected higher interest costs due to market variations. The Council manages this risk by having a view of the future course of interest rates and then formulating a treasury management strategy accordingly which aims to maximise investment earnings consistent with control of risk or alternatively, seeks to minimise expenditure on interest costs on borrowing. Green Legal and Regulatory Risk This is the risk that the organisation itself, or an organisation with which it is dealing in its treasury management activities, fails to act in accordance with its legal powers or regulatory requirements, including failure to comply with the CIPFA Codes and that the organisation suffers losses accordingly. That investment funds will not be returned in full to the Council due to the failure of the counterparty to comply with their contractual obligations The Council will not undertake any form of investing until it has ensured that it has all necessary powers and has complied with all regulations. Green 143
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27 Appendix 3: Permitted Investments, Risks and Mitigating Controls Type of Investment Description and Risk Mitigating Controls Council Limits Banks Unsecured These are accounts, deposits, certificates of deposit and senior unsecured bonds with banks and building societies, other than multilateral development banks, which are established by more than one country, e.g. European Investment Bank. These investments are subject to the risk of credit loss via a bail-in should the regulator determine that the bank is failing or likely to fail. Diversifying investments is crucial to managing bail-in risk, in addition to determining proportionate counterparty and maturity limits. Certificates of Deposit, which are tradable on the secondary market and which can be sold prior to maturity, will also assist in managing credit risk. The combined secured and unsecured investments in any one bank will not exceed £10m. Banks Secured These are covered bonds, reverse repurchase agreements and other collateralised arrangements with banks and building societies. Reverse purchase agreements involve the purchase of securities with the agreement to sell at a future date at a higher price. Collateralised arrangement are an investment with collateral such as properties or debt. These investments are secured on the bank’s assets, which limits the potential losses in the unlikely event of insolvency, and means that they are exempt from bail- in. Where there is no investment specific credit rating, but the collateral upon which the investment is secured has a credit rating, the higher of the collateral credit rating and the counterparty credit rating will be used to determine cash and time limits. The combined secured and unsecured investments in any one bank will not exceed £10m. 144
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28 Type of Investment Description and Risk Mitigating Controls Council Limits Operational Bank Accounts The Council will incur operational exposures to its banking services provider, Clydesdale Bank, through current accounts. The bank is not currently on the Council's lending list as its credit ratings are below the investment credit rating criteria of A-. These balances are not classed as investments but are still subject to the risk of bail-in and balances will therefore be minimised. The Bank of England has stated that in the event of failure, banks with assets greater than £25 billion (which applies to Clydesdale Bank) are more likely to be bailed in than made insolvent, increasing the chance of the Council maintaining operational continuity. . The Council monitors its operational accounts on a daily basis, transferring any surplus funds to investment accounts and there for minimising the amount held in the operational bank account at any time. Government These are loans, bonds and bills issued or guaranteed by national governments, regional and local authorities and multilateral development banks. Includes the UK Debt Management Office. These investments are not subject to bail- in, and there is an insignificant risk of insolvency. Investments with the UK Central Government may be made in unlimited amounts for up to 50 years. Corporates These are loans, bonds and commercial paper issued by companies other than banks and registered social landlords. Loans to unrated companies will only be made if approved through a separate report to Council. These investments are not subject to bail- in, but are exposed to the risk of the company going insolvent. This risk will be mitigated by taking independent external advice and diversifying investments over a number of counterparties. Loans to unrated companies would be made as part of a diversified pool in order to spread the risk widely. 145
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29 Type of Investment Description and Risk Mitigating Controls Council Limits Registered Social Landlords These are loans and bonds issued by, guaranteed by or secured on the assets of Registered Social Landlords (Housing Associations). These bodies are regulated by the Scottish Housing Regulator and by the Homes and Communities Agency for Registered Providers of Social Housing in England. As providers of public services, they retain the likelihood of receiving government support if needed and are therefore considered low risk. Policy driven, managing all associated risks. Money Market Funds These are diversified investment vehicles consisting of the any of the above investment types, plus equity shares and property. These funds have the advantage of providing wide diversification of investment risks, coupled with the services of a professional fund manager in return for a management fee. Short-term Money Market Funds that offer same-day liquidity and very low or no volatility will be used as an alternative to instant access bank accounts. It is recommended that no more than 10% of the Council’s total investments are invested in any one MMF and that the amount invested is no more than 0.5% of the size of a MMF used for liquidity purposes. For pooled investment vehicles that invest in bonds, equities and property, all of which operate on a variable net asset value (VNAV) it is recommended that no more than 10% of the Council’s total investments are invested in each fund. These investments will be held for periods greater than 1 year. 146
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30 Type of Investment Description and Risk Mitigating Controls Council Limits Investment Properties These are non-operational properties that are being held pending disposal, or for a longer- term rental income stream. They are highly illiquid assets with high risk to value (the potential for property prices to fall or for rental voids). In larger investment portfolios, some small allocation of property-based investment may counterbalance/ complement the wider cash portfolio. Property holding will be re- valued regularly and reported annually with gross and net rental streams. Member approval required and each application must be supported by the service rationale behind the loan and the likelihood of partial or full default. Policy driven, managing all associated risks. Loans to third parties, including soft loans These are service investments either at market rates of interest, or below market rates (soft loans). These types of investments may exhibit credit risk and are likely to be highly illiquid. Each third party loan requires Member approval and each application must be supported by the service rationale behind the loan and the likelihood of partial or full default. Interest payments and loan repayments will be monitored and the likelihood of partial or full default re- assessed regularly. Policy driven, amount and loan maturity limit will be determined on a case-by-case basis. Loans to a local authority company These are service investments either at market rates of interest, or below market rates (soft loans). These types of investments may exhibit credit risk and are likely to be highly illiquid. Each loan to a local authority company requires Member approval and each application must be supported by the service rationale behind the loan and the likelihood of partial or full default. Interest payments, loan repayments, and their timeliness will be monitored and the likelihood or partial or full default reassessed regularly. Policy driven, amount and loan maturity limit determined on a case-by-case basis, managing all associated risks. 147
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31 Type of Investment Description and Risk Mitigating Controls Council Limits Shareholdings in a local authority company These are service investments, which may exhibit market risk and are likely to be highly illiquid. Each equity investment in a local authority company requires Member approval and each application must be supported by the service rationale behind the investment and the likelihood of loss. Service investments will be subject to scrutiny by Financial Services on a regular basis and will include scrutiny of financial statements issued by the local authority company. Policy driven, amount determined on a case-by-case basis, managing all associated risks. Non-local authority shareholdings These are non-service investments, which may exhibit market risk, will only be considered for longer term investments and are likely to be liquid. Any non-service equity investment will require separate Member approval and each application must be supported by the service rationale behind the investment and the likelihood of loss. Non-service investments will be subject to scrutiny by Financial Services on a regular basis, reported to Members, and will include scrutiny of financial statements issued by the company. Policy driven, amount and anticipated time frame for shareholding determined on a case-by-case basis, managing all associated risks. 148
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32 Appendix 4: Policy on Repayment of Loans Fund Advances Policy on Repayment of Loans Fund Advances The purpose of the Loans Fund is to record advances from the loan fund for expenditure incurred, or loans made to third parties, which a local authority has determined are to be financed from borrowing as set out in Regulation 2 of The Local Authority (Capital Finance and Accounting) (Scotland) Regulations 2016 [“the Regulations”]. The Council is also statutorily required to repay Loans Fund advances and to prudently determine the periods over which it will repay Loans Fund advances and the amount of repayments in any financial year. Loans Fund advances comprise several items and the estimated opening balances for 2024/25, where applicable for North Ayrshire Council, are: • capital expenditure (£454.140m); • grants to third parties and expenditure on third party assets which would be classified as capital expenditure by a local authority (£0m); • loans to third parties (£0m); and • expenditure for which a borrowing consent has been issued by the Scottish Government (£0m). Prudent repayment of Loans Fund advances The loans fund advance is effectively the repayment of the ‘principal’ linked to the expenditure classified above which is unfinanced and is required to be funded from borrowing. Repayment of loans fund advances are required to be made in line with Scottish Government statutory guidance on Loans Fund Accounting. The Council’s annual accounts require to include a disclosure of details of Loans Fund transactions. The HRA Loans Fund advances and associated annual repayments are identified separately from that of the General Fund. The broad aim of prudent repayment is to ensure that the Council’s unfinanced capital expenditure is repaid over the period of years in which that expenditure is expected to provide a benefit and that each year’s repayment amount is reasonably commensurate with the period and pattern of the benefits. The statutory guidance requires the Council to approve a policy on Loans Fund repayments each year and recommends a number of options for calculating prudent repayments. North Ayrshire Council’s policy is as follows: For the majority of projects undertaken by the Council the policy is to use the asset life method to repay loans fund advances on an annuity basis, which is similar to the repayment of a mortgage where principal payments are lower at the start of the mortgage and build up to deliver full repayment over the term of the mortgage. As well as annuity, the asset life method has the option of equal instalments. The Council will continue to consider the most appropriate repayment method which aligns to the benefits of the assets and ensures a prudent repayment. 149
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33 In addition, there are some projects where income streams are attached to the project which can be reasonably associated with the borrowing which will be undertaken. In these circumstances it may be more appropriate for the advances to be repaid on a profile which matches this income. For these unique projects, loans fund advances may be profiled for repayment to match the income and not on the annuity basis. These options comply with the statutory guidance and the Council will continue to consider all options available to it. The repayment of Loans Fund advances will therefore be equal to the annual amount determined in accordance with the Local Authority (Capital Finance and Accounting) (Scotland) Regulations 2016. The above regulations state that Council’s may vary the period and/or amount of the repayments if they consider it prudent to do so. As a result, officers continue to review existing loans fund advances for opportunities to ensure the most prudent repayment method is being used. Estimates of prudent Loans Fund repayment The Council’s latest estimates of its Loans Fund account information are as follows: Policy on Apportioning Interest to the HRA Interest and expenses on all new borrowing is allocated to the HRA based on the share of total borrowing taken each year. Year Opening Balance £m Advances to GF £m Advances to HRA £m Repayment by GF £m Repayment by HRA £m Closing Balance £m 2022/23 actual 352.989 2.492 13.994 19.962 -5.372 384.065 2023/24 384.065 51.246 21.284 -1.461 -4.994 450.140 2024/25 - 28/29 450.140 207.757 200.724 -13.655 -33.205 811.760 2029/30 – 33/34 811.760 8.717 53.153 -19.464 -40.918 813.247 2034/35 – 38/39 813.247 0.000 78.267 -23.657 -51.933 815.923 2039/40– 43/44 815.923 0.000 97.847 -58.078 -60.818 794.874 2044/45 – 48/49 794.874 0.000 10.337 -80.229 -65.921 659.061 2049/50 – 53/54 659.061 0.000 0.000 -97.915 -60.944 500.202 2054/55 – 58/59 500.202 0.000 0.000 -74.414 -56.485 369.303 2059/60 – 63/64 369.303 0.000 0.000 -44.604 -61.121 263.578 2064/65 – 68/69 263.578 0.000 0.000 -36.656 -60.019 166.904 2069/70 & later 166.904 0.000 0.000 -37.396 -129.507 0.000 150
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34 Appendix 5: Economic Background – Arlingclose’s View December 2023 Economic Outlook The impact on the UK from higher interest rates and inflation, a weakening economic outlook, an uncertain political climate due to an upcoming general election, together with war in Ukraine and the Middle East, will be major influences on the Authority’s treasury management strategy for 2024/25. The Bank of England (BoE) increased Bank Rate to 5.25% in August 2023, before maintaining this level for the rest of 2023. In December 2023, members of the BoE’s Monetary Policy Committee voted 6-3 in favour of keeping Bank Rate at 5.25%. The three dissenters wanted to increase rates by another 0.25%. The November quarterly Monetary Policy Report (MPR) forecast a prolonged period of weak Gross Domestic Product (GDP) growth with the potential for a mild contraction due to ongoing weak economic activity. The outlook for CPI inflation was deemed to be highly uncertain, with upside risks to CPI falling to the 2% target coming from potential energy price increases, strong domestic wage growth and persistence in price-setting. Office for National Statistics (ONS) figures showed CPI inflation was 3.9% in November 2023, down from a 4.6% rate in the previous month and, in line with the recent trend, lower than expected. The core CPI inflation rate declined to 5.1% from the previous month’s 5.7%, again lower than predictions. Looking ahead, using the interest rate path implied by financial markets the BoE expects CPI inflation to continue falling slowly, but taking until early 2025 to reach the 2% target before dropping below target during the second half 2025 and into 2026. ONS figures showed the UK economy contracted by 0.1% between July and September 2023. The BoE forecasts GDP will likely stagnate through 2024. The BoE forecasts that higher interest rates will constrain GDP growth, which will remain weak over the entire forecast horizon. The labour market appears to be loosening, but only very slowly. The unemployment rate rose slightly to 4.2% between June and August 2023, from 4.0% in the previous 3-month period, but the lack of consistency in the data between the two periods made comparisons difficult. Earnings growth has remained strong but has showed some signs of easing; regular pay (excluding bonuses) was up 7.3% over the period and total pay (including bonuses) up 7.2%. Adjusted for inflation, regular pay was 1.4% and total pay 1.3%. Looking forward, the MPR showed the unemployment rate is expected to be around 4.25% in the second half of calendar 2023, but then rising steadily over the forecast horizon to around 5% in late 2025/early 2026. Having increased its key interest rate to a target range of 5.25-5.50% in August 2023, the US Federal Reserve appears now to have concluded the hiking cycle. It is likely this level represents the peak in US rates following a more dovish meeting outcome in December 2023. US GDP grew at an annualised rate of 4.9% between July and September 2023, ahead of expectations for a 4.3% expansion and the 151
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35 2.1% reading for Q2. But the impact from higher rates has started to feed into economic activity and growth will weaken in 2024. Annual CPI inflation was 3.1% in November. Eurozone inflation has declined steadily since the start of 2023, falling to an annual rate of 2.4% in November 2023. Economic growth has been weak and GDP contracted by 0.1% in the three months to September 2023. In line with other central banks, the European Central Bank has increased rates, taking its deposit facility, fixed rate tender, and marginal lending rates to 3.75%, 4.25% and 4.50% respectively. Credit outlook Credit Default Swap (CDS) prices were volatile during 2023, spiking in March on the back of banking sector contagion concerns following the major events of Silicon Valley Bank becoming insolvent and the takeover of Credit Suisse by UBS. After then falling back in Q2 of calendar 2023, in the second half of the year, higher interest rates and inflation, the ongoing war in Ukraine, and now the Middle East, have led to CDS prices increasing steadily. On an annual basis, CDS price volatility has so far been lower in 2023 compared to 2022, but this year has seen more of a divergence in prices between ringfenced (retail) and non-ringfenced (investment) banking entities once again. Moody’s revised its outlook on the UK sovereign to stable from negative to reflect its view of restored political predictability following the volatility after the 2022 mini-budget. Moody’s also affirmed the Aa3 rating in recognition of the UK’s economic resilience and strong institutional framework. Following its rating action on the UK sovereign, Moody’s revised the outlook on five UK banks to stable from negative and then followed this by the same action on five rated local authorities. However, within the same update the long-term ratings of those five local authorities were downgraded. There remain competing tensions in the banking sector, on one side from higher interest rates boosting net income and profitability against another of a weakening economic outlook and likely recessions that increase the possibility of a deterioration in the quality of banks’ assets. However, the institutions on our adviser Arlingclose’s counterparty list remain well- capitalised and their counterparty advice on both recommended institutions and maximum duration remain under constant review and will continue to reflect economic conditions and the credit outlook. 152