Chief Executive Service - Capital Monitoring Report 1 April 2022 to 6 January 2023 (Period 10)
North Lanarkshire Council · 1 March 2023
Back to Finance and Resources Committee — 1 March 2023 and its agenda
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North Lanarkshire Council Report Finance and Resources Committee Does this report require to be approved? ☐ Yes ☒ No Ref EK/NL/PF Date 01/03/23 Chief Executive Service – Capital Monitoring Report 1 April to 6 January 2023 (Period 10) From Elaine Kemp, Chief Officer (Finance) E-mail KempE@northlan.gov.uk Telephone 07939 280 601 Executive Summary This report highlights the financial performance and provisional outturn of 2022/23 Chief Executive capital programme for the period ended 6 January 2023 (Period 10). In summary the Service has a total capital budget of £14.289m, comprising of £10.470m within Business and Digital and £3.819m within Communities. CMT (11 October 2022) approved capital budget reductions across all services, per the recommendations of the Capital Investment Programme Review. This will result in a reduction of £0.490m within Business and Digital and £4.016m within Communities over the remaining program. Subject to approval at SCDG, Business and Digital have identified a reduction of £0.206m and Communities identifying a reduction of £1.000m within 2022/23, with the balance of £3.300m to be reprofiled over future years. The Service is currently projecting year end variance of £3.629m (£1.000m within Business and Digital and £2.629m within Communities), which includes the proposed Capital Investment Programme Review budget reduction of £1.206m. Further explanation of project variances and management action taken by the Service is included within the main report and attached appendices. Recommendations It is recommended that the Committee: (1) Considers the financial position of the 2022/23 Chief Executive capital programme. The Plan for North Lanarkshire Priority Improve economic opportunities and outcomes Ambition statement (25) Ensure intelligent use of data and information to support fully evidence based decision making and future planning
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1. Background 1.1 This report provides a summary of the Chief Executive Service financial performance for the period 1 April 2022 to 6 January 2023 (Period 10). The report illustrates the provisional outturn as at 31 March 2023, with major outturn variances highlighted and explained per the Council’s approved Financial Regulations. 1.2 The Council approved its Capital 5-year programme at Policy and Strategy Committee on 18 March 2021 with an allocated budget of £13.036m for the current year. Following a number of realignments, the allocation of growth funding and reprofiling budgets to future years the revised Capital Programme is £14.249M for the 2022/23 Financial Year as detailed in Appendix 1 of this report. 1.3 The Council’s approved Financial Regulations required the Chief Executive to remain within his approved budgetary provision, and to report all significant deviations – defined as the higher of £0.100m or 5% - within their budget monitoring reports. Where significant deviations were identified, Executive Directors must provide explanatory commentary, outline the action required to rectify such deviations and where relevant, must also highlight the impact this has on other budget headings. 2. Report 2.1 Summary of Financial Position 2.1.1 The service is currently projecting an underspend of £3.629m within the current financial year, inclusive of the proposed Capital Investment Programme Review budget reduction of £1.206m. A request to reprofile £2.423m within the Composite Capital Programme will be presented to SCDG (February 2023). Actual budget movements are explained in more detail in Section 2.2 below. In addition, capital budgets and expenditure are detailed in Appendix 1 and a summary of proposed budget reprofiling requests in Appendix 2. 2.2 Analysis of Significant Variances 2.2.1 A explanation of variances within Business and Digital is detailed below: • Digitisation & Innovation The budget for this theme is £7.462m with an updated projected spend of £7.222m by 31 March 2023. The current year spend to date per the ledger is £3.997m with a projected committed spend of £7.167m. The current projection has resulted in a reprofiling request of £0.240m. • Line of Business (LOB) This theme has been reprofiled to £1.504m with a year-end projection of £1.044m. The actual year to date spend is low due to timing issues. Current spend is £0.323m with committed spend of £0.892m. A projected underspend of £0.460m is being reported to reflect the reprofiling request this period, which includes the proposed £0.006m reduction relating to the Capital Investment Programme Review. • End User Device (EUD) The budget is £1.504m with spend and commitments totalling £1.194m. A projected underspend of £0.300m is being reported to reflect the reprofiling request which includes the proposed £0.200m reduction relating to the Capital Investment Programme Review. 2.2.2 Challenges facing the Service throughout financial year 2021/22 in respect of lengthy delivery times and competing resourcing have continued into 2022/23. Business and
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Digital therefore reviewed projections and requested £4.424m be reprofiled to later years, better reflecting the likely phasing of project costs. Work packages aligned to the DigitalNL programme continue to be closely monitored to ensure they remain within the available capital investment. 2.2.3 An explanation of variances within Communities is detailed below: The Communities budget reduction in relation to the Capital Investment Programme Review is £4.016m over the remaining years of the programme with appropriate substitutions being identified from alternative funding sources. The Service are therefore proposing to remove £1.000m from the 2022/23 budget, subject to SCDG approval, leaving a reduction of £3.016m from future years. The Service has actual spend and commitments amounting to £0.803m and is projecting spend at year end of £1.190m resulting in a year end variance of £2.629m, which includes the proposed £1.000m reduction relating to the Capital Investment Programme Review. This is due to challenges faced in obtaining bids for tendered projects and contractors unable to deliver projects within previously agreed timeframes. Expenditure on these projects will not therefore be incurred until 2023/24. 2.3 Management Actions 2.3.1 The service will continue to review phasing of associated programmes with updates being provided to the SCDG, DigitalNL Board and Committee accordingly 3. Measures of success 3.1 The Service aim is to operate within approved budget resources over the term of the capital programme. 4. Supporting documentation 4.1 Appendix A Summary Expenditure by Project / Theme Elaine Kemp Chief Officer (Finance)
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5. Impacts ( http://connect/report-template-guidance ) 5.1 Public Sector Equality Duty and Fairer Scotland Duty Does the report contain information that has an impact as a result of the Public Sector Equality Duty and/or Fairer Scotland Duty? Yes ☐ No ☒ If Yes, please provide a brief summary of the impact? If Yes, has an assessment been carried out and published on the council’s website? https://www.northlanarkshire.gov.uk/your-community/equalities/equality- and-fairer-scotland-duty-impact-assessments Yes ☐ No ☐ 5.2 Financial impact Does the report contain any financial impacts? Yes ☒ No ☐ If Yes, have all relevant financial impacts have been discussed and agreed with Finance? Yes ☒ No ☐ If Yes, please provide a brief summary of the impact? The Service aims to operate within approved funding levels across the term of the programme and utilise budget virements to support emerging issues. 5.3 HR policy impact Does the report contain any HR policy or procedure impacts? Yes ☐ No ☒ If Yes, have all relevant HR impacts have been discussed and agreed with People Resources? Yes ☐ No ☐ If Yes, please provide a brief summary of the impact? 5.4 Legal impact Does the report contain any legal impacts (such as general legal matters, statutory considerations (including employment law considerations), or new legislation)? Yes ☐ No ☒ If Yes, have all relevant legal impacts have been discussed and agreed with Legal and Democratic? Yes ☐ No ☐ If Yes, please provide a brief summary of the impact? 5.5 Data protection impact Does the report / project / practice contain or involve the processing of personal data? Yes ☐ No ☒ If Yes, is the processing of this personal data likely to result in a high risk to the data subject? Yes ☐ No ☐ If Yes, has a Data Protection Impact Assessment (DPIA) been carried out and e- mailed to dataprotection@northlan.gov.uk Yes ☐ No ☐ 5.6 Technology / Digital impact
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Does the report contain information that has an impact on either technology, digital transformation, service redesign / business change processes, data management, or connectivity / broadband / Wi-Fi? Yes ☐ No ☒ If Yes, please provide a brief summary of the impact? Where the impact identifies a requirement for significant technology change, has an assessment been carried out (or is scheduled to be carried out) by the Enterprise Architecture Governance Group (EAGG)? Yes ☐ No ☐ 5.7 Environmental / Carbon impact Does the report / project / practice contain information that has an impact on any environmental or carbon matters? Yes ☐ No ☒ If Yes, please provide a brief summary of the impact? 5.8 Communications impact Does the report contain any information that has an impact on the council’s communications activities? Yes ☐ No ☒ If Yes, please provide a brief summary of the impact? 5.9 Risk impact Is there a risk impact? Yes ☒ No ☐ If Yes, please provide a brief summary of the key risks and potential impacts, highlighting where the risk(s) are assessed and recorded (e.g. Corporate or Service or Project Risk Registers), and how they are managed? 5.9.1 All activities undertaken by the Council are subject to risk, and in acknowledging the Council’s approved Risk Management Strategy, Services managed these as part of their overall corporate and service planning processes. The current economic climate, in particular, has the potential to impact upon the Council’s ability to provide quality services within approved budget levels. 5.9.2 To minimise risk this report was prepared by service based Financial Solutions personnel in consultation with budget managers, in accordance with the Financial Regulations 5.10 Armed Forces Covenant Duty Does the report require to take due regard of the Armed Forces Covenant Duty (i.e. does it relate to healthcare, housing, or education services for in-Service or ex- Service personnel, or their families, or widow(er)s)? Yes ☐ No ☒ If Yes, please provide a brief summary of the provision which has been made to ensure there has been appropriate consideration of the particular needs of the Armed Forces community to make sure that they do not face disadvantage compared to other citizens in the provision of public services.
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Appendix 1 Chief Executives Capital Programme 2022/23 Thematic Expenditure Summary 1st April 2022 - 6th January 2023 (Period 10) Theme Budget £ Actual £ Committed £ Uncommitted £ Projected Outturn £ Outturn variance £ Digitisation & Innovation 7,461,528 3,997,390 7,167,323 54,205 7,221,528 240,000 Line of Business (LOB) System Portfolio 1,504,322 323,181 892,038 152,249 1,044,287 460,035 End User Device (EUD) Refresh 1,503,902 68,514 1,193,800 10,102 1,203,902 300,000 TOTAL BUSINESS and DIGITAL 10,469,752 4,389,085 9,253,161 216,556 9,469,717 1,000,035 COMMUNITIES Community Board Project Investment Fund 3,819,345 665,100 803,422 386,493 1,189,915 2,629,430 TOTAL COMMUNITIES 3,819,345 665,100 803,422 386,493 1,189,915 2,629,430 TOTAL CHIEF EXECUTIVES 14,289,097 5,054,185 10,056,583 603,049 10,659,632 3,629,465 YTD OUTTURN
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Appendix 2 SUMMARY OF PROPOSED BUDGET REPROFILING/ACCELERATION REQUESTS Amount Category From To Service: Chief Executives £ Re-profiling to future years Business & Digital: Digitisation & Innovation (240,000) 3 Digitisation & Innovation (Year 2) Digitisation & Innovation (Year 3) Line of Business (LOB) System Portfolio (197,550) 3 Line of Business (LOB) System Portfolio (Year 2) Line of Business (LOB) System Portfolio (Year 3) Line of Business (LOB) System Portfolio (256,685) 3 Line of Business (LOB) System Portfolio (Year 2) Line of Business (LOB) System Portfolio (Year 4) End User Device (EUD) Refresh (Year 2) (100,000) 3 Total Business & Digital (794,235) Community Boards Community Board Project Investment Fund (1,629,430) 3 Community Board Project Investment Fund (Year 2) Community Board Project Investment Fund (Year 3) Total Community Boards (1,629,430) Total reprofiling to Future Years (2,423,665) Capital Investment Programme Review Business & Digital: Line of Business (LOB) System Portfolio (Year 2) (5,800) 2 Reduction approved by CMT End User Device (EUD) Refresh (Year 2) (200,000) 2 Reduction approved by CMT End User Device (EUD) Refresh (Year 3) (232,237) 2 Reduction approved by CMT End User Device (EUD) Refresh (Year 4) (51,763) 2 Reduction approved by CMT Total Business & Digital (489,800) Community Boards Community Board Project Investment Fund (Year 2) (1,000,000) 2 Reduction approved by CMT Community Board Project Investment Fund (Year 3-5) (3,016,000) 2 Reduction approved by CMT Total Community Boards (4,016,000) Total Chief Executive - net movement (6,439,665)