Agenda Document Pack - Moray Council - 28/01/2026
Moray Council · 28 January 2026
Back to Moray Council — 28 January 2026 and its agenda
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Moray Council Wednesday, 28 January 2026 NOTICE IS HEREBY GIVEN that a Meeting of the Moray Council is to be held at Council Chambers, Council Office, High Street, Elgin, IV30 1BX on Wednesday, 28 January 2026 at 09:30. BUSINESS 1. Sederunt 2. Declaration of Group Decisions and Members Interests * 3. Resolution Consider, and if so decide, adopt the following resolution: "That under Section 50A (4) and (5) of the Local Government (Scotland) Act 1973, as amended, the public and media representatives be excluded from the meeting for Item 11 of business on the grounds that it involves the likely disclosure of exempt information of the class described in the relevant Paragraphs of Part 1 of Schedule 7A of the Act.” 4. Minutes of meeting 3 December 2025 5 - 20 5. Written Questions ** 6. Capital Plan 2026-29 Report by the Chief Executive 21 - 42 7. Charging for Services Report by the Chief Executive 43 - 64 8. Just Transition Fund Report by Executive Director Economy, Enterprise and Operations 65 - 76 Page 1
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9. Elgin High School Expansion Project Update Report by Executive Director Education, Housing and Communities 77 - 98 10. Revised Remit Audit and Scrutiny Committee Report by Executive Director Economy, Environment and Operations 99 - 106 Item(s) which the Committee may wish to consider with the Press and Public excluded 11. Report on Tender - Banff Road, Keith Phase 3 [Para 7 and 9] • 7. Information relating to the financial or business affairs of any particular person (other than the authority). • 9. Any terms proposed or to be proposed by or to the authority in the course of negotiations for a contract for the acquisition or disposal of property or the supply of goods or services. Watching the Meeting You can watch the webcast live by going to: http://www.moray.gov.uk/moray_standard/page_43661.html Webcasts are available to view for 1 year following the meeting. You can also attend the meeting in person. If you wish to attend in person, please come to the High Street entrance door and a member of staff will let you into the Chamber. Page 2
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GUIDANCE NOTES * Declaration of Group Decisions and Members Interests - The Chair of the meeting shall seek declarations from any individual or political group at the beginning of a meeting whether any prior decision has been reached on how the individual or members of the group will vote on any item(s) of business on the Agenda, and if so on which item(s). A prior decision shall be one that the individual or the group deems to be mandatory on the individual or the group members such that the individual or the group members will be subject to sanctions should they not vote in accordance with the prior decision. Any such prior decisions will be recorded in the Minute of the meeting. ** Written Questions - Any Member can put one written question about any relevant and competent business within the specified remits not already on the agenda, to the Chair provided it is received by the Proper Officer or Committee Services by 5pm three working days prior to the day of the meeting, please see Standing Order 36 for deadlines. A copy of any written answer provided by the Chair will be published on the Council’s committee management system by 12pm the day before the meeting. The Member who has put the question may, after the answer has been published, may ask one supplementary question directly related to the subject matter at the meeting, but no discussion will be allowed. No supplementary question can be put or answered more than 10 minutes after the Council has started on the relevant item of business, except with the consent of the Chair. If a Member does not have the opportunity to put a supplementary question because no time remains, then he or she can submit it in writing to the Proper Officer who will arrange for a written answer to be provided within 7 working days. Page 3
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MORAY COUNCIL Moray Council SEDERUNT Councillor Kathleen Robertson (Chair) Councillor Amber Dunbar (Depute Chair) Councillor James Allan (Member) Councillor Peter Bloomfield (Member) Councillor Neil Cameron (Member) Councillor Tracy Colyer (Member) Councillor Theresa Coull (Member) Councillor John Cowe (Member) Councillor John Divers (Member) Councillor Jérémie Fernandes (Member) Councillor Donald Gatt (Member) Councillor David Gordon (Member) Councillor Juli Harris (Member) Councillor Sandy Keith (Member) Councillor Elaine Kirby (Member) Councillor Scott Lawrence (Member) Councillor Marc Macrae (Member) Councillor Paul McBain (Member) Councillor Neil McLennan (Member) Councillor Shona Morrison (Member) Councillor Bridget Mustard (Member) Councillor Derek Ross (Member) Councillor John Stuart (Member) Councillor Draeyk van der Horn (Member) Councillor Sonya Warren (Member) Councillor Ben Williams (Member) Clerk Name: Tracey Sutherland Clerk Telephone: 07971 879268 Clerk Email: committee.services@moray.gov.uk Page 4
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MORAY COUNCIL Minute of Meeting of the Moray Council Wednesday, 3 December 2025 Council Chambers, Council Office, High Street, Elgin, IV30 1BX PRESENT Councillor James Allan, Councillor Peter Bloomfield, Councillor Neil Cameron, Councillor Tracy Colyer, Councillor Theresa Coull, Councillor John Cowe, Councillor John Divers, Councillor Amber Dunbar, Councillor Jérémie Fernandes, Councillor Donald Gatt, Councillor David Gordon, Councillor Juli Harris, Councillor Sandy Keith, Councillor Elaine Kirby, Councillor Scott Lawrence, Councillor Marc Macrae, Councillor Paul McBain, Councillor Neil McLennan, Councillor Shona Morrison, Councillor Bridget Mustard, Councillor Kathleen Robertson, Councillor Derek Ross, Councillor Draeyk van der Horn, Councillor Ben Williams APOLOGIES Councillor John Stuart, Councillor Sonya Warren IN ATTENDANCE Chief Executive, Executive Director Economy, Enterprise and Environment, Executive Director Education, Housing and Communities, Chief Officer Moray Integrated Joint Board, Head of Service and Chief Social Work Officer, Chief Governance Officer (Monitoring Officer), Head of Housing, Property and Communities, Head of Customer Experience, ICT and Digital Services, Chief Financial Officer, Service Manager Strategic Finance, Service Manager Housing Strategy, Service Manager Leisure and Culture, Community Learning and Engagement Team Manager and Service Manager Democratic Services. 1. Chair The meeting was chaired by Councillor Kathleen Robertson. 2. Message of Condolence The Council joined the Chair in expressing their condolences to the family of the late former Councillor Morag Anderson who sadly died in October. 3. Declaration of Group Decisions and Members Interests In terms of Standing Orders 21 and 23 and the Councillors' Code of Conduct, there were no declarations from Group Leaders or Spokespersons in regard to any prior decisions taken on how Members will vote on any item on the agenda or any further declarations of Member's interests in respect of any item on the agenda. Item 4. Page 5
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4. Resolution The meeting resolved that in terms of Section 50A (4) and (5) of the Local Government (Scotland) Act 1973, as amended, the public and media representatives be excluded from the meeting for Item 14 of business on the grounds that it involves the likely disclosure of exempt information of the class described in the relevant Paragraphs of Part 1 of Schedule 7A of the Act. Para number of the minute Para Number of Schedule 7a 27 Para 7 Information relating to the financial or business affairs of any particular person (other than the authority) 28 Para 7 Information relating to the financial or business affairs of any particular person (other than the authority) Para 9 Any terms proposed or to be proposed by or to the authority in the course of negotiations for a contract for the acquisition or disposal of property or the supply of goods or services. 29 Para 1 Information relating to a particular employee, former employee or applicant to become an employee of, or a particular officeholder, former officeholder or applicant to become an officeholder under, the authority. 5. Minutes of meeting of 19 September 2025 - Public The minute of the meeting of 19 September 2025 was submitted and approved. 6. Minutes of meeting of 24 September 2025 The minute of the meeting of 24 September 2025 was submitted and approved. 7. Minutes of meeting of 6 November 2025 The minute of the meeting of 6 November 2025 was submitted and approved. 8. Emergency Notice of Motion Councillor Keith sought permission from the Chair to submit an emergency notice of motion following the announcement of the UK government's additional £820m in funding to the Scottish Government and for a letter to be written to urge the Scottish Government to ensure that local government receives some of the additional funding. In response, the Chief Governance Officer (Monitoring Officer), stated that standing orders do have notices of motion provision, which is 14 days or 10 working days prior Page 6
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to the meeting. There can be an exception in Standing Order 35 for a notice of motion, which would be accepted by reason of urgency, which would be in the opinion of the leader as being considered urgent. He further added that the situation had been known in relation to the budget for a number of days. There was nothing in writing before the Council to consider. So, there was a question as to the notice period and that there could have been something for consideration earlier than this morning. On considering the advice of the Chief Governance Officer (Monitoring Officer), the Chair advised that she was not going to accept the emergency notice of motion and that Councillor Keith could raise the issue again when the Revenue Budget Report was considered. 9. Written Questions Under reference to Standing Order 36 a written question from Councillor Warren was submitted under the following terms: Major Developments Recent discussion around major renewable energy proposals, such as the Moray FLOW-Park, has highlighted the importance of clear communication between officers, senior Members and local councillors when early engagement with developers takes place. What mechanisms are currently in place to ensure that Ward Members are informed at an early stage when Senior Officers or Council Leader meet with developers to discuss significant development proposals within their areas? Response Recent discussion around major renewable energy proposals, such as the Moray FLOW-Park, has highlighted the importance of clear communication between Officers, Senior Members and Local Councillors when early engagement with developers takes place. What mechanisms are currently in place to ensure that Ward Members are informed at an early stage when senior officers or Council Leaders meet with developers to discuss significant development proposals within their areas? In engaging with external stakeholders, a difficult balance must to be struck by senior officers and senior members involved in this engagement between enabling what is often (but not exclusively) a candid exchange of information which is commercially confidential and provided on a still evolving proposal, and the need to share relevant information with the wider member body at a time and to an extent that is appropriate for the potential development in question. This cannot be prescribed as considerations vary from case to case, but is supported by the Council’s Guidance on Councillor/Officer relations, Councillors’ Roles and Responsibilities Guidance, and supplemented by legal advice as required. Some specific clarifications can be offered however as follows: Page 7
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• Often developers seek early engagement on proposals to allow them to raise awareness and/or take informal soundings on a proposal which is still in development. Many proposals at this stage are speculative and as such a number will not be further developed. At this stage, conversations will usually be regarded as commercially confidential. This was the case with the Moray Flow Park. • Excepting regulatory requirements on consultation and notification, it is for the developer to determine how and when their community engagement arrangements begin and how they are implemented. Sharing information with all councillors is likely to be viewed as beginning that community engagement process. • Moray Council does not have a role in directing or delivering the developer’s community engagement processes – this is a matter for them - particularly where regulatory processes will be involved as this can create conflicts of interest for councillors. Guidance has been provided by the Monitoring Officer in this respect for the Moray Flow Park proposal. • Information which could be shared with all councillors was sought relative to the Moray Flow Park and circulated at the earliest opportunity. Under reference to Standing Order 36 a written question from Councillor Keith was submitted under the following terms: Deanshaugh Park What steps are the Council taking to stop unauthorised encampments on the hardstanding area adjacent to the playing fields at Deanshaugh Park Elgin? Response The Council has installed a chain and combination padlock on the entrance gates at Lesmurdie Road to deter unauthorised access to the hardstanding area beside the playing fields at Deanshaugh Park, Elgin. Whilst this measure is not impregnable, it affords a degree of control of the site whilst ensuring it remains accessible to approved users, including the Air Ambulance service. Euroblocks had been considered as an alternative for the gate entrance, however they would restrict essential access. Officers are reviewing alternative locking mechanisms for the gates that would offer a stronger deterrent than the chain and padlock currently in place. Under reference to Standing Order 36 a written question from Councillor Dunbar was submitted under the following terms: Financial Assistance Mechanisms Page 8
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What measures does Moray Council currently have in place to support local businesses during infrastructure works that may adversely impact trade and accessibility? Additionally, has the Council considered, or is there scope to develop, any financial assistance mechanisms or mitigation funds to support businesses that experience demonstrable disruption as a result of Council-led works? Response The general rule is that there is no compensation if a business is affected by road works properly carried out by the roads authority. Successive governments have taken the view that businesses should not have the right in law to any particular given level of passing trade, and that traders must take the risk of loss due to temporary disruption of traffic flows along with all the other various risks of running a business. This is set out in government advice. Utility companies operate under separate legislation which may provide for compensation. In light of this legislative context the council has no financial assistance mechanisms in place. 10. Chief Social Work Officer Annual Report 2024-25 The meeting had before it, a report by the Chief Social Work Officer asking Council to note the annual report of the Chief Social Work Officer (CSWO) on the statutory work undertaken on the Council’s behalf during the period 1 April 2024 to 31 March 2025. Following consideration, the Council unanimously agreed to note the content of the report contained at Appendix 1. 11. Moray Integration Joint Board Chief Officer Update The meeting had before it, a report by the Chief Officer, Health and Social Care Moray, informing the Council of the latest approved minutes of the meeting of the Moray Integration Joint Board and to provide an update on the MIJB revenue budget position at Quarter 1, 2025/26. Following consideration, the Council unanimously agreed to note the contents of the report. 12. Revenue Budget Monitoring and Estimated Act to 30 September 2025 The meeting had before it, a report by the Chief Executive advising Council of the revenue budget monitoring position as of 30 September 2025, quarter 2 2025/26 and the estimated outturn for the year. Councillor Keith stated that the Scottish Government's budget is due on 13 January 2026. The UK Government announced in their budget an additional £820m extra funding for the Scottish Government. He moved that the Leader writes to the Cabinet Secretary for Finance to request a fairer funding deal for Moray. This was seconded by Councillor Ross. Councillor Lawrence stated that the funding formula for local government is decided by CoSLA and that Councillor Keith is proposing to write to the wrong person. He Page 9
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further added that the Council Leader should make representations at CoSLA for additional funding. Councillor Keith stated that he would be happy for the Council Leader to write to the Cabinet Secretary for Finance and CoSLA. Councillor Lawrence, seconded by Councillor Cameron proposed the recommendations as printed. On the division there voted: For the Motion (17) Councillors Keith, Ross, Allan, Bloomfield, Colyer, Cowe, Divers, Dunbar, Gatt, Gordon, Kirby, Macrae, McBain, McLennan, Mustard, Robertson and Williams For the Amendment (6) Councillors Lawrence, Cameron, Coull, Fernandes, Harris and van der Horn Abstention (1) Councillor Morrison Accordingly, the motion became the finding of the meeting and following further consideration, the Council agreed to: i) note the budget monitoring position of £1,848,000 over budget for 2025/26 as at 30 September 2025; ii) note that this position consists of underspends within Education, on Devolved School budgets of £510,000, and non-devolved School budgets of £619,000, and an overspend on Out of Area Placements of £604,000 to date; an underspend in Education, Resources and Community of £150,000; an underspend of £262,000 in Environmental and Commercial Services; an overspend on Social Care and Children’s Services delivered on behalf of the Moray Integration Joint Board (MIJB) of £2,617,000, and overspends in other services totalling £168,000; iii) note an increase of £2,033,000 in the General Revenue Grant, as detailed in paragraph 4.3; and iv) note the current estimated out-turn for 2024/25 of an overspend of £2,472,000, which includes projected overspends in Health and Social Care and Children’s Services of £900,000 after adjusting for the cost sharing agreement with NHS for MIJB, Education £2,553,000, Environmental and Commercial Services £211,000, Financial Services £385,000, and underspends in Education, Resources and Communities £302,000 and Economic Growth and Development Services of £191,000, and other variances totalling £1,084,000 under spend; v) note that Heads of Service have been tasked with reducing overspends and generally reducing expenditure to bring the outturn back into line with budget; and vi) the Council Leader will write to the Cabinet Secretary for Finance and CoSLA to request a fairer funding deal for Moray Page 10
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13. Capital Plan 2025-2026 Quarter 2 The meeting had before it, a report by the Chief Executive informing Council of the expenditure to 30 September 2025 under the capital plan for financial year 2025/26 and to recommend budget adjustments for inclusion in the capital plan for 2026/27 and future years. Following consideration, the Council unanimously agreed to: i) note expenditure to 30 September 2025 of £16,580,000 shown in Appendix 1; ii) note Appendix 2 - major capital projects spanning more than 1 financial year; iii) note the indicative affordability indicator for each year of the three year 2025 - 2028 Capital Plan; and iv) approved amendments of £694,000 to the capital plan for 2025/26 as set out in section 6. 14. Short to Medium Term Financial Plan The meeting had before it, a report by the Chief Executive updating Council on the Short to Medium Term Financial Plan for the period 2025/26 to 2027/28. Following consideration, the Council unanimously agreed to approve: i) an increased savings target of up to £2.4 million in 2026/27, with in-year savings in 2025/26 to be maximised to preserve the Council’s reserves as much as possible; ii) Savings of £16,000 in 2025/26 and £18,000 in 2026/27 from Education budgets, as set out in paragraph; and iii) Additional funding to Moray Integration Joint Board (MIJB) from the additional funding from Scottish Government for the 2025/26 pay award, pro rata to the MIJB budget for salaries. The Council also agreed to note the risks and uncertainties currently identified in paragraph 5.5 to 5.10 and listed in Appendix 2 to this report. 15. Meeting Attendance Protocol The meeting had before it, a report by the Executive Director Economy, Enterprise and Operations asking Council to consider and approve changes to the Remote/Hybrid Meeting Protocol to also include in person attendance and for the document to be re- named Meeting Attendance Protocol. Councillor Lawrence expressed a number of concerns with the document in relation to equality legislation and moved to defer the report to allow for a workshop to be held to allow Councillors to discuss the document and then bring back the report Page 11
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when there is more agreement from Councillors. This was seconded by Councillor Coull. Councillor Williams stated that he felt the changes proposed were reasonable and seconded by Councillor Macrae proposed considering the item at the meeting. On the division there voted For the Motion (13) Councillors Lawrence, Cameron, Coull, Cowe, Divers, Harris, Fernandes, McLennan, Morrison, Mustard, Robertson, Ross, van der Horn For the Amendment (10) Councillors Williams, Macrae, Allan, Bloomfield, Colyer, Dunbar, Gordon, Keith, Kirby and McBain Abstention (1) Councillor Gatt Accordingly, the motion became the finding of the meeting and Council agreed to defer the report to allow a member’s workshop to be held and for the report to come back to a future meeting. In terms of Standing Order 65, Councillor Macrae requested that his dissent be recorded. 16. Budget Protocol for 2026-27 Budget Setting Process The meeting had before it, a report by the Executive Director Economy, Enterprise and Operations providing the Council with an updated Budget Protocol reflecting feedback on the version used for the 2025/26 budget setting process and to seek approval of this as policy for the 2026/27 budget setting process. Following consideration, the Council unanimously agreed the updated Budget Protocol V14 produced as Appendix 1. 17. Improving Attendance Project The meeting had before it, a report by the Executive Director Education Housing and Communities seeking approval for a spend to save transformation project aimed at improving attendance at work to be added to the Transformation Strategy. Councillor Kirby sought clarification on whether instead of using the funding for managing 6 members of staff whether the additional funding could be used to invest in recruitment drives or extra maths clinic etc. In response, the Executive Director Education Housing and Communities stated that a specific problem in relation to escalating absence figures had been identified and the proposals in front of Council today are to try and resolve the issue. Councillor McLennan, adding to Councillor Kirby's comments moved that funding earmarked for this project are placed into school support which is broader than just attendance or increase the number of Pupil Support Assistants for the period of the project. Page 12
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The Chief Executive expressed caution as the proposals are changing the proposed project markedly and there is a risk that it will dilute the terms of the pilot which is being proposed. The pilot is proposed to start in the schools but learning from the project will be extended across the Council. The Chair sought a seconder for Councillor McLennan's motion. On failing to secure a seconder the motion fell and in terms of Standing Order 65, Councillor McLennan requested that his dissent be recorded. Following further consideration, the Council agreed to: i) approve the proposed spend to save transformation project aimed at improving attendance at work, reducing absence costs and having a positive impact on the service and workforce; ii) funding of up to £89,000 to be drawn from the transformation reserve for an initial pilot of one year to support the project pending the anticipated financial benefits to enable it to be self-financing in future years; iii) Approve the posts required for the project as set out in the report; and iv) an interim report is brought to the Corporate Committee to track progress after 6 months of implementation. 18. Elected Members Allowances and Expenses Scheme The meeting had before it, a report by the Executive Director Education, Housing and Communities asking Council to consider and approve the proposal for publication of elected member expenses. Councillor Ross welcomed the report but sought further clarification on Community Events and that there should be more explanation on what is classified as a Community Event and sought agreement for Group Leaders to determine what Community Events are. He further added that he did not think Councillors should claim for mileage when attending Remembrance events. The Chief Governance Officer (Monitoring Officer) advised that the Councillors Expenses Policy was agreed at the meeting of the Council on 25 June 2025 and any change to those recommendations would require a suspension of standing orders to amend what had been agreed. Councillor Ross moved to suspend standing orders. This was seconded by Councillor Keith. Councillor Macrae, seconded by Councillor Lawrence proposed not to suspend standing orders and to agree the recommendations as printed. On the division there voted: For the Motion (5) Councillors Ross, Keith, Divers, Gatt and Kirby. Page 13
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For the Amendment (19) Councillors Macrae, Lawrence, Allan, Bloomfield, Cameron, Colyer, Coull, Cowe, Dunbar, Fernandes, Gordon, Harris, McBain, McLennan, Morrison, Mustard, Robertson, van der Horn and Williams Abstention (0) Accordingly, the amendment became the finding of the meeting and Council agreed to: i) note the option to publish Members' expense claims; and ii) approve moving to publication of Members' expense claims following appropriate training and communication of the revised procedure. 19. Community Council Administration Grant The meeting had before it, a report by the Executive Director Education, Housing and Communities asking Council to review the annual administration grant to Community Councils and to approve an updated grant allocation. In terms of Standing Order 83 the Chair sought agreement from Council to suspend standing order 75 to continue the meeting past 12.45pm. This was unanimously agreed. Following consideration, the Council unanimously agreed to: i) increase the total administration grant to Community Councils, both the fixed amount and per capita by 7.75%. The administration grant to Community Councils for 2026/27 will therefore be £537.98 plus 7.83p per capita and reviewed annually thereafter in line with inflation; ii) those Community Councils with no access to a suitable Council venue for holding meetings, access to schools (outside of school hours) will be investigated; and iii) explore the purchase of laptops by the Council for the use of Community Councils as a further option to support the work of Community Councils. 20. Grampian Venture Capital Fund The meeting had before it, a report by the Executive Director Economy, Enterprise and Operations seeking authority to progress the winding up the limited company Grampian Venture Capital Fund limited. Following consideration, the Council unanimously agreed: i) As shareholder, to the members voluntary liquidation (winding up) of Grampian Venture Capital Funding limited under section 282 of the Companies Act 2006 and s 100 of the Insolvency Act 1986; Page 14
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ii) That the Executive Director, Economy, Enterprise and Operations is authorised to sign (either in person or by proxy) any necessary resolution or documentation on behalf of the Council; and iii) that the receipt is a revenue receipt and is applied towards or to defray existing expenditure on economic development functions to be determined by the Economic Development and Infrastructure Services Committee. 21. Meeting Dates The meeting had before it, a report by the Executive Director Economy, Enterprise and Operations seeking approval to change the schedule of meetings of Moray Council in January and February 2026. In terms of Standing Order 83 the Chair sought agreement from the Council to suspend standing 82 to allow consideration of the item, as the meeting dates had been agreed less than 6 months previously. This was unanimously agreed. Following consideration, the Council unanimously agreed to: i) re-schedule the meeting due to be held on 14 January 2026 to 28 January 2026; and ii) hold a special meeting at 9.30am on 25 February 2026 with the scheduled ordinary meeting to begin immediately following the special meeting or at 2pm, whichever is the earliest on the same day. 22. Scheme of Delegation Update The meeting had before it, a report by the Executive Director Economy, Enterprise and Operations seeking to approve the updated Scheme of Delegation following the management restructure. Following consideration, the Council unanimously agreed to approve the changes to the Scheme of Delegation following the Council re-structure. 23. Resumption of Meeting PRESENT Councillor James Allan, Councillor Peter Bloomfield, Councillor Neil Cameron, Councillor Tracy Colyer, Councillor Theresa Coull, Councillor John Cowe, Councillor John Divers, Councillor Amber Dunbar, Councillor Jérémie Fernandes, Councillor Donald Gatt, Councillor David Gordon, Councillor Juli Harris, Councillor Sandy Keith, Councillor Elaine Kirby, Councillor Scott Lawrence, Councillor Marc Macrae, Councillor Paul McBain, Councillor Neil McLennan, Councillor Shona Morrison, Councillor Bridget Mustard, Councillor Kathleen Robertson, Councillor Derek Ross, Councillor Draeyk van der Horn, Councillor Ben Williams APOLOGIES Councillor John Stuart, Councillor Sonya Warren Page 15
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ALSO IN ATTENDANCE Chief Executive, Executive Director Economy, Enterprise and Environment, Executive Director Education, Housing and Communities, Chief Governance Officer (Monitoring Officer), Head of Housing, Property and Communities, Head of Customer Experience, ICT and Digital Services, Chief Financial Officer, Service Manager Housing Strategy, Service Manager Leisure and Culture and Service Manager Democratic Services. 24. Outside Body Appointments The meeting had before it, a report by the Executive Director Economy, Enterprise and Operations asking Council to consider and agree whether to make appointments to the Outside Body vacancies as detailed in paragraph 5. No nominations were put forward for the Scotland Excel vacancy. Councillors Dunbar and Cameron were nominated for the 2 Moray Women's Aid vacancies. Councillor Bloomfield moved that Councillor Macrae be the Council's representative on the Scottish Councils Committee on Radioactive Substances. This was seconded by Councillor Dunbar. Councillor McLennan, seconded by Councillor Morrison proposed Councillor van der Horn be the Council's representative. On the division there voted: For the motion (15) Councillors Bloomfield, Dunbar, Allan, Colyer, Divers, Gatt, Gordon, Keith, Kirby, Macrae, McBain, Mustard, Robertson, Ross and Williams For the amendment (8) Councillors McLennan, Morrison, Cameron, Coull, Cowe, Harris, Lawrence and van der Horn Abstention (1) Councillor Fernandes Accordingly, the motion became the finding of the meeting and the Council agreed: Scotland Excel No appointment Moray Women's Aid Councillor Dunbar Councillor Cameron Scottish Councils Committee on Radioactive Substances Councillor Macrae 25. Libraries Learning Centres and Heritage Service Transformation The meeting had before it, a report by the Executive Director Education, Housing and Communities providing Council with a progress update on the Libraries, Learning Page 16
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Centres and Heritage Service Transformation and sought approval to progress with the proposed new operating model for the Service. Prior to the meeting an amendment had been circulated in which Councillor Coull suggested a 3rd option. She stated that Keith is the only library to lose hours, other locations have stayed the same or they have gained hours and felt that the system options in the report seemed unfair and inequitable. Councillor Coull moved that Council consider a 3rd Option to add a further tier as follows: Tier 1 below 5k visits Tier 2 5-10k visits Tier 3 10k - 30k visits Tier 4 30k+ visits Tier 5 100k+ visits Burghead Dufftown Tomintoul Cullen Milnes Aberlour Lossiemouth Keith Buckie Forres Elgin As with Option 2 all 10 hours 20 hours increased 4 hours 30 hours - stay the same 36 hours - stay the same 48 hours Total 240 hours with 2 hours spare which can be allocated to Cullen to keep them at the same hours. There is justification in this as to be fair and equitable. Between Tier 1 and 2 the difference is 3,551. Between Tier 2 and Tier 3 the difference is 5,431 and between Tier 1 and 3 the difference is 8,982 visits. This was seconded by Councillor Harris. In response, the Service Manager Leisure and Culture stated that option 3 had been looked at by Officers and it was possible within the funding envelope and within the operating hours, however it would effectively create a six tier model with Cullen, Keith and Elgin libraries sitting in their own tiers and this would then impact the efficiency of the new proposed staffing route. The purpose of the tiered system meant that staff in each area would have the same hour contracts and could support branches across that tier. Having more tiers would make the rota system more complex to create. Following further consideration, Councillor Macrae, seconded by Councillor Bloomfield proposed the recommendations as printed in the report. On the division there voted: For the Motion (10) Councillors Coull, Harris, Cameron, Divers, Fernandes, Lawrence, McLennan, Morrison, van der Horn and Williams For the Amendment (14) Councillors Macrae, Bloomfield, Allan, Colyer, Cowe, Dunbar, Gatt, Gordon, Keith, Kirby, McBain, Mustard, Robertson and Ross Page 17
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Abstention (0) Accordingly, the amendment became the finding of the meeting and the Council agreed to: i) note progress on the Libraries, Learning Centres and Heritage transformation journey; ii) proceed with Option 2 as set out in the reports; and iii) note that further reports will be brought to Council to consider future transformation changes such as co-location when opportunities are identified. Councillor Harris left the meeting at the conclusion of this item. 26. Information Reports - if called in The meeting noted that no Information Reports had been called in. 27. Out of hours Project Closure Report [Para 7] The meeting had before it a report by the Chief Executive seeking authorisation to close the Out of Hours project. Following consideration, the Council unanimously agreed to: i) note the information presented within this report; and ii) approve closure of the project as peer paragraph 6.1. 28. Report on Tender - Bilbohall Elgin Phase 1 [Para 7 and 9] The meeting had before it a report by the Executive Director Education Housing and Communities seeking authorisation to accept a tender. Following consideration, the Council unanimously agreed to: i) accept the tender received from Ogilvie Construction for Bilbohall, Elgin Phase 1, subject to confirmation of grant funding; and ii) notes that progress on the delivery of the Council’s new build programme will be reported to a future meeting of the Housing and Community Safety Committee. 29. Management Structure Update [Para 1] Page 18
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The meeting had before it, a report by the Chief Executive providing notes that progress on the delivery of the Council’s new build programme will be reported to a future meeting of the Housing and Community Safety Committee. Following consideration, the Council unanimously agreed to approve: i) the extension of the Interim Chief Social Work Officer contract for up to six months; ii) delegated authority to implement interim cover for up to six months for the critical posts: currently of Executive Director for Finance, Strategy and Transformation and Chief Financial Officer and Head of People, Change and Community Strategy to be provided within existing resources in the event of additional unsuccessful recruitment campaigns for the permanent posts; and iii) the performance indicators identified and the annual reporting, with baseline collection to take place in April 2026 and reporting as soon as practicable and annually thereafter. Page 19
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Report to: Moray Council Meeting Date: 28 January 2026 Report by: Chief Executive Author: Jamie Fraser Contact Email: jamie.fraser@moray.gov.uk Subject: Three-year Capital Plan 2026-29 and indicative 10-year Capital Plan to 2036 1. PURPOSE ☒ For Decision ☐ For Information 1.1 The purpose of this report is to ask Council to agree the Council’s three-year capital budget for 2026-29 and to consider the Council’s indicative ten-year Capital Plan for the period 2026 to 2036. 1.2 This report is submitted to the Council in terms of the Council's Administrative Scheme section (II) (22) and (23) relating to the approval of the annual estimates of capital and revenue expenditure for all services. 2. SUMMARY 2.1 Moray Council on 21 January 2025 (paragraph 7 of the minute refers) agreed to introduce a three-year Capital Plan for the period 2025-28, moving away from a historic single year model. Recognising the complexity and lead in times associated with capital projects the three-year plan looked to address project slippage by providing budget managers with greater certainty of budget and the opportunity to plan over multiple financial years, which in turn would aid in the reduction of capital slippage. The 2025-28 plan also saw the implementation of the cap on capital, a mechanism used to address affordability. 2.2 Work begun on updating the Capital Plan in October 2025. With the starting position being to maintain years two (2026/27) and three (2027/28) of the previous iteration of the Capital Plan. The intention was to give budget managers confidence they can plan over multiple years and to avoid further capping. Affordability calculations have been applied to all subsequent years, with a total cap on capital of £71.000m required to 2036, of which £10.000m is recommended in 2028/29. The proposed Capital Plan for the three-year period 2026-29 is £221.607m. Item 6. Page 21
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2.3 Scottish Government is due to announce its 2026/27 budget on 13 January 2026, and thereafter the draft Local Government settlement, giving clarity to the proposed amounts for both revenue and capital grants at authority level. As at the time of preparing the budget a conservative approach to expected grant values was used. It is recommended any variance is noted and approved as part of the Q4 2025/26 Capital Monitoring paper to Council, outlining a strategy to releasing any additional capacity or to absorb any unforeseen reduction in capital grant. 2.4 The indicative 10-year Capital Plan is a tool to identify spending trends, plan for the future and address affordability issues. The indicative Capital Plan to 2036 totals £427.600m for which the majority of investment (exclusive of major fully funded expenditure) is dedicated to addressing the Learning Estate. 2.5 The key message that reducing the Councils core asset base is crucial to achieving affordability and sustainability still stands. The report provides an update on progress achieved in 2025. The required application of the cap on capital in future years illustrates the need for decisive action on reducing the asset base to achieve sustainability. This is further emphasised in the Best Value Thematic for 2025/26 on asset management issued by the Accounts Commission. 3. RECOMMENDATIONS 3.1 It is recommended that the Council approves: i) Prioritisation of named projects as set out in paragraph 6.7 for the financial year 2028/29, in accordance with the approved capping methodology; ii) Capital expenditure of £221.607m for the three-year period 2026-29 as set out in the indicative 10-year Capital Plan in APPENDIX 2; and iii) That due to timing of the Scottish Government budget process any amendment to the plan concomitant on the final local government settlement is considered and approved as part of 2025/26 Q4 Capital Monitoring report to be presented on 30 June 2026. 3.2 It is recommended that the Council considers and notes: i) The indicative 10-year plan inclusive of cap on capital, set out in APPENDIX 3; and ii) The underlying need to reduce the Councils asset base and progress to date. Jamie Fraser Service Manager Strategic Finance Page 22
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4. BACKGROUND AND CONTEXT 4.1 For a number of years prior to 2024, the Council considered its capital budget alongside its revenue budget for the coming year. As decisions on capital expenditure have an impact on revenue spend it was considered good practice to view both capital and revenue proposals together. However, by the nature of Capital Planning, including longer term focus and considerable lead-in time for projects, considering the Capital Plan as a standalone item is good practice, particularly as discussions around affordability continue to take place. 4.2 The Council is required to establish the affordability of its Capital Plan in accordance with the CIPFA Prudential Code. Under the code, the sustainability of borrowing costs need to be considered against revenue budget. The Council has established an internal Key Performance Indicator, setting an affordability ceiling of 10%. This is measured as a ratio of financing costs to net revenue stream. Financing costs are principal and interest loan charges, and charges associated with certain lease payments, primarily the Public-Private Partnership (PPP) and Design, Build, Finance, Maintain (DBFM) school contracts. Net revenue stream is defined as Scottish Government Revenue Grant, Council Tax income and NDR income. This clearly defined limitation of the amount of revenue which is determined by capital expenditure facilitates a full and separate discussion on capital expenditure whilst retaining consideration of the impact of capital decisions on revenue requirements. 4.3 Capital expenditure only has a direct impact on the Council’s revenue budget when the Council requires to borrow to finance or part-finance the expenditure. Consequently any project which is fully funded by grant or other external funding has no impact of the affordability of the capital plan. Subject to the Council having the capacity within its staffing resource to carry out additional work, if full funding becomes available for a project that project can be added to the capital plan at any time. This can be the mechanism for projects – for example replacement Lossiemouth East Beach bridge, Cloddach bridge – to be considered and added outwith the normal planning cycle. No project can be added which impacts on the affordability of the capital plan 4.4 A cap on capital was introduced in the 2025-28 Capital Plan as the mechanism to address affordability. At its meeting on 22 October 2024 (paragraph 9 of the minute refers) the Council approved the methodology of applying the cap, which is applied to either core programme or named project expenditure. Fully funded and spend-to-save expenditure is not subject to capping. The cap is pro-rated based on named project and core expenditure, with a prioritisation methodology applied to named projects. Where the proportion of cap on named project cannot be allocated it shall be absorbed by core programme expenditure. Details of the prioritisation of named projects are detailed below: • Contributes towards achieving a corporate priority in the Corporate Plan Page 23
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• Fulfils a legislative requirement e.g. health and safety requirement following inspection • Impact on connectivity between communities and facilities • Community priority 4.5 Moray Council on 21 January 2025 (paragraph 7 of the minute agrees) agreed to introduce a three-year Capital Plan for the period 2025-28, moving away from the historic single year model. Recognising the complexity and lead-in times associated with capital projects the three-year plan looked to address project slippage by providing budget managers with greater certainty of budget and the opportunity to plan over multiple financial years. 5 BUDGET DEVELOPMENT AND CORE ASSUMPTIONS 5.1 Work begun on updating the Capital Plan in October 2025, with the starting position being to maintain years two (2026/27) and three (2027/28) of the previous iteration of the Capital Plan. The intention was to give budget managers confidence they can plan over multiple years and to avoid further capping. Where applicable, asset groups have seen a rephasing of budgets following previously agreed amendments. Any new project specific grant funding has also been accounted for. 5.2 Scottish Government is due to announce its 2026/27 budget on 13 January 2026, with the draft Local Government settlement forming part of that budget and detail of the settlement for individual authorities expected shortly thereafter. As at the time of preparing the budget a conservative approach to expected grant values was used. Both general capital grant and general revenue grant have been based on a zero-growth basis of the 2025/26 settlement. Figures used are consistent with those included in the Short to Medium Term Financial Plan presented and agreed by Council on 3 December 2025 (para 13 of the minute refers). It is recommended any variance to these estimates are noted and approved as part of the Q4 2025/26 Capital Monitoring paper to be presented to Council on 30 June 2026, outlining a strategy to release additional capacity or to absorb any unforeseen reduction in capital grant. 5.3 Interest rates have seen a period of record highs following over a decade of historic lows. Table 1 shows the rate history between the Bank of England base rate, gilt yields (with gilt yields being the base rate for interest rates charged by the Public Works Loans Board) and the Councils internal rate of borrowing. The internal rate of borrowing is the figure used to calculate loans pool interest rate charges in each year. The table shows that whilst the internal rate of borrowing is less susceptible to volatility it tends to lag behind both the Bank of England base rate and gilt yields. The table also shows a clear historic relation between each of the rates, which has become less certain following the rise of interest rates from 2021. In forecasting the internal rate of borrowing for future years a flat rate of 5% has been used. This is based on the Bank of England current trend of reducing the base rate since its most recent high in 2023. This is consistent with advice from the Council’s treasury management advisors, Arlingclose, who also forecast a general reduction in interest rates. Page 24
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Table 1. Rate History 5.4 Whilst capital allocations for 2026/27 and 2027/28 are proposed to be fixed, budget managers were given the opportunity to make additional funding bids. The aspiration was that should additional capacity become available during the development process (through lower funding requirements in future years or lower expected financing costs, etc) then additional capacity would be released in those years. In total, £14.591m of additional funding bids were made. Appendix 1 provides a table of the additional funding bids, some of which were previously named projects removed from the plan due to affordability i.e. Arthur’s Bridge. Given the size of the cap required in future years the recommended plan does not include any additional funding in 2026/27 and 2027/28. This will be revisited as part of the update to Council in June 2026 as noted in paragraph 5.2. 6 APPLICATION OF CAP ON CAPITAL 6.1 Budget Managers were asked to compile their capital bids for the 2026-36 Capital Plan in October 2025. For years one and two of the plan (2026/27 and 2027/28) the amounts have been fixed, being cognisant of the 2025-28 approved plan, albeit Budget Managers were able to make additional funding bids in those years, as noted above. Applying affordability calculations, the indicative affordability indicator for each of the years is as noted in Table 2. Table 2. Affordability PI before capping 2026/27 2027/28 2028/29 2029/30 2030/31 9.27% 9.18% 9.45% 9.14% 9.76% 2031/32 2032/33 2033/34 2034/35 2035/36 10.90% 11.43% 11.18% 11.39% 11.34% 6.2 Current spend plans are affordable until 2031/32, at which point all future loans charges exceed the 10% affordability threshold and continue for the remaining years of the plan. The 0 1 2 3 4 5 6 7 Pecentage Rate FInancial Year Rate History 2006 -2026 Base Rate (%) Gilt Yeilds (%) Internal Rate of Borrowing (%) Page 25
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required cap to bring the Council’s budgeted loans charges within the 10% is £71.000m (an increase of £16.625m compared to the prior iteration of the plan). Reasons for the movement include: lifecycle costs attributable to the PPP/DBFM schools are being capitalised and the refinement of financing cost estimations (including IFRS 16 Leases). 6.3 As loans charges are incurred one year in arrears of capital expenditure this forecast affordability issue needs to be addressed by 2030/31 at the latest. Modelling for corrective action from 2030/31 would mean nearly 3 years of externally funded spend only. This is not a feasible action given forecast need for spend and forecast grant funding. Therefore, it would be more prudent to spread the cap over available years, similar to the prior iteration of the Capital Plan. Table 3 shows the recommended cap on capital from 2028/29. It should be noted that the proposed indicative cap for 2028/29 in the indicative 10-year plan reported in January 2025 was £33.954m, therefore additional spending capacity has been released for that year. Table 3. Affordability PI before and after proposed cap 2028/29 2029/30 2030/31 2031/32 2032/33 2033/34 2034/35 Before Cap 9.45% 9.14% 9.76% 10.90% 11.43% 11.18% 11.39% Cap (£m) 10.000 17.000 15.000 28.000 - 1.000 - After Cap 9.45% 8.91% 9.16% 10.00% 9.98% 9.77% 10.00% 6.4 The approved methodology for the cap on capital is to allocate pro rata to named project expenditure and core programme expenditure. Where the proportion of cap on named projects cannot be allocated it shall be absorbed by core programme expenditure. For the financial year 2028/29 the proportion was calculated at 44% to named projects and 54% to core programme expenditure. 6.5 Total named project expenditure for 2028/29 is set out in table 4. As two of the three named projects are fully committed, the only named project available for capping is the refurbishment and upgrade of swimming pools in the Leisure Estate. It is therefore recommended that £0.400m of the required cap on capital for 2028/29 is allocated to named projects with the remaining cap of £9.600m absorbed by core expenditure. Table 4. List of named projects 2028/29 Asset Group Project Value (£m) Priority Learning Estate Elgin High School £2.470 Committed Learning Estate Forres Academy £13.867 Committed Leisure Estate Refurbishment & Upgrade of Pools £0.400 Corporate Priority 6.6 Given the size of the cap required in future years the recommended plan does not include any additional funding in 2026/27 and 2027/28. This will be revisited as part of the update to Council in June 2026 as noted in paragraph 5.2. Page 26
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6.7 The estimated financing costs for the period 2026/29 are shown in table 5. Had the cap not been applied, then from 2028/29 an approximate annual saving of £750,000 in revenue to cover additional loans costs would need to be found, or Council Tax increase by 1.5% to accommodate the additional cost of the Capital Plan whilst keeping a balanced budget. Table 5. Cost of Capital 2026-29 Cost of Capital 2026/27 2027/28 2028/29 Estimated Affordability PI 9.27% 9.18% 9.45% Estimated Finance Cost (£m) 27.849 28.630 30.348 7 CAPITAL PLAN 2026 - 29 7.1 The Council’s Financial Regulations require approval of detailed capital spend by Service Committees. Accordingly, the draft plan at APPENDIX 2 and indicative 10-year plan at APPENDIX 3 are at a summary level for each asset group. This section of the report indicates the basis for each asset group budget for 2026-29, any specific considerations in developing the budget, and the amount of cap applied to each asset group. APPENDIX 4 shows the application of the cap against each of the various asset groupings. 7.2 The indicative ten-year plan for 2025–35 showed forecasted spend of £27.317m in 2028/29 (exclusive of major fully funded projects i.e. Moray Growth Deal, Levelling Up Fund, etc). This included a cap of £33.954m. The updated plan includes like-for-like spend bids totalling £42.484m before capping. The £10.000m cap as noted in para 6.3 has been applied, bringing like-for-like spend to £32.484m and total spend (inclusive of major fully funded projects) to £48.710m for 2028/29. 7.3 Fleet and Plant 2026/27 £m 2027/28 £m 2028/29 £m Total £m 2.694 2.001 1.837 6.532 The £6.532m allocation for Fleet and Plant is for the delivery of the fleet replacement programme and is based on an asset management plan based on the average optimum replacement age of different vehicle types. Actual conditions of vehicles are then considered when the replacement programme is agreed with service departments. An aspiration of the programme is to replace the fleet with electric vehicles where appropriate. A Zero Emission Fleet Replacement strategy was approved by Economic Development and Infrastructure Services Committee on 30 April 2024 (paragraph 15 of the minute refers), however the previously applied cap for the 2025-28 Capital Plan has resulted in a re- phasing of electric replacement on the grounds of cost, with almost no vehicles being replaced with electric counterparts in 2025/26. The 2026-29 includes an element of Spend- to-Save budget to be allocated to the Zero Emission Felet Replacement strategy. In developing the 2026-29 plan the service also noted that the pace of infrastructure upgrades (installation of charging stations) would also be a limiting factor in converting to an electric fleet. Page 27
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7.4 A reduction of £0.623m has been applied to the 2028/29 budget. This accounts for 25% of the requested budget. Due to reductions in funding for fleet replacement, mitigation measures will be implemented to manage operational and financial impacts. Vehicle life will be extended where feasible, with a focus on continuing and prioritising heavy fleet replacements at their optimum replacement age. This approach reflects the higher maintenance costs, sourcing challenges for parts, and expense of temporary hire associated with heavy vehicles. Early estimations suggest that for each vehicle not replaced at its optimum replacement age an additional annual maintenance cost of £2,340 would be incurred, increasing to £3,025 if external hire costs to cover downtime are required. This cost could double if maintenance needs to be outsourced due to limited mechanic capacity within the service. By the end of 2028/29 it is expected 50 vehicles will be affected creating a potential budget pressure from £0.150m to £0.425m. This is being monitored as part of our current revenue reporting and a further business case will be developed by the service in the coming year. Additionally, the transition to electric vehicles will continue on a whole- life cost basis to achieve long-term savings. However, the pool of suitable candidate vehicles will be smaller and Spend-to-Save funding will be required to bridge the gap in capital funding for each diesel to electric replacement. 7.5 Waste Management 2026/27 £m 2027/28 £m 2028/29 £m Total £m 0.124 0.114 0.114 0.352 The £0.352m allocation for Waste Management and consists of capital bids for the replacement of domestic and trade bins, upgrades to recycling centres and facilities management equipment upgrades. A reduction of £0.092m has been applied to the 2028/29 budget. This accounts for 45% of the requested budget. 7.6 Property Estate Management 2026/27 £m 2027/28 £m 2028/29 £m Total £m 1.317 2.015 2.236 5.568 Core 210 340 286 0.836 Spend to Save 1.107 1.675 1.950 4.732 The £5.568m allocation for Property Management relates to both core (£0.836m) and Spend-to-Save (£4,732m) expenditure. Spend-to-Save initiatives include the Salt Barn, Keith and the Depot and Stores review, which had Full Business Case approval by Council on 25 June 2025 (paragraph 30 of the minute refers). No cap has been applied to these items. Bids have also been made for energy efficiency projects, industrial estate upgrades and replacement of corporate office furniture. A reduction of £0.233m has been applied to the 2028/29 core budget. This accounts for 45% of the requested budget. 7.7 Roads, Bridges and Street Lighting 2026/27 £m 2027/28 £m 2028/29 £m Total £m 5.919 5.018 5.470 16.407 The £16.407m allocation for Roads, Bridges and Street Lighting covers the majority of the Council’s infrastructure assets. Bids have been collated as part of asset management Page 28
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plans, which are reviewed annually and reprioritised in response to asset condition. A reduction of £3.628m has been applied to the 2028/29 budget. This accounts for 45% of the requested budget. The Roads, Bridges and Street Lighting asset group contains a number of budgets which include capitalised staffing costs. Any reduction in capital budget potentially has a direct impact on the relevant revenue budget. Departments impacted have been exploring opportunities to increase rechargeable works, increasing the amount of work done in-house. 7.8 The Roads, Bridges and Street Lighting budget has responsibility for many infrastructure assets, which if were to fail could lead to costly replacement as well as catastrophic risk to human life. In developing the budget, there is no capacity to react to instant asset failures and this would need to be addressed by reprioritising planned works within the relevant service budget. A funding bid had been made for Arthur’s Bridge at £7.160m. This has not been allowed for as a named project in the draft plan due to affordability, however will be explored as part of the report in paragraph 5.2. Arthur’s Bridge was previously deferred on the basis that further investigation was required to establish an accurate record of the bridges condition. A principal inspection was carried out in February 2025 confirming the bridge could still maintain its current load capacity however further deterioration is expected. 7.9 Open Spaces 2026/27 £m 2027/28 £m 2028/29 £m Total £m 0.371 1.143 0.157 1.671 The £1.671m allocation for Open Spaces is largely for new and existing cemeteries in accordance with the Councils strategy for cemeteries as approved by Economic Development and Infrastructure Services Committee on 4 December 2018 (paragraph 6 of the minute refers) with the remaining allowance available for the placement of life expired assets. A reduction of £0.128m has been applied to the 2028/29 budget. This equates to 45% of the requested budget. 7.10 Flood Risk Management and Coastal Protection 2026/27 £m 2027/28 £m 2028/29 £m Total £m 0.460 - 0.300 0.700 The £0.700m allocation for Flood Risk Management and Coastal Protection is made entirely of fully funded spend on coastal adaptation. No reduction in funding has been applied. 7.11 Harbours 2026/27 £m 2027/28 £m 2028/29 £m Total £m 0.271 0.610 0.166 1.047 The £1.047m allocated to Harbours is made up of capital bids for the replacement of life expired elements and upgrades, which also includes pontoon upgrades. Planned works are based on a rolling programme of inspection and subsequent prioritisation. Monitoring and inspecting harbour assets present significant challenges, as many structures are submerged, making issue identification difficult. This can lead to asset failure with very little Page 29
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warning. A reduction of £0.134m has been applied to the 2028/29 budget. This equates to 45% of the requested budget. The reduced budget will mean extending the asset life with the potential for higher repair and maintenance costs as well as increased risk of failure which could pose a health and safety risk. The recent breach of the wall at Portsoy Harbour in Aberdeenshire serves as a recent example of risks materialising. There is also a risk of reduced income as assets become both less appealing and fit for purpose (i.e. pontoons). 7.12 Libraries and Leisure 2026/27 £m 2027/28 £m 2028/29 £m Total £m 0.571 5.321 0.756 6.648 The £6.648m allocated to Libraries and Leisure is for the delivery of the approved short, medium and long term actions for service development across the Moray Sport and Leisure service as agreed by Council on 24 September 2025 (paragraph 16 of the minute refers) and also service development opportunities across the Libraries Service. A reduction of £1.013m has been applied to 2028/29. Libraries and Leisure is the only asset group where the cap on capital could be applied to named projects, therefore £0.400m has been removed and relates to the refurbishment of swimming pools. In total, 57% of the requested budget was removed for 2028/29. The Service Manager Leisure & Culture has been consulted on the budget reduction. This has no immediate impact on the above-mentioned actions, however, will form part of the discussions around agreeing the approach to future capital investment which will be brought back to Committee in due course. 7.13 ICT 2026/27 £m 2027/28 £m 2028/29 £m Total £m 0.642 0.508 0.315 £1.465 The £1.465m allocated to ICT is based on a planned programme of prioritised upgrades including server and network infrastructure, desktop and mobile devices and essential software upgrades across both the Corporate and Learning Estate. A further refresh of Learning Estate ICT strategy is planned for 2026/27 which will determine the investment requirement going forward. A reduction of £0.255m has been allocated for 2028/29. This represents a 45% reduction of the requested budget. The reliance on ICT across every service in the Council should be noted. Ageing and obsolete ICT infrastructure is at higher risk of cyber-attacks as it becomes unsupported by vendors. The performance of equipment will also diminish over time, particularly if software requirements become more demanding and can impact on device and network performance. However, consideration has also been given to the market requirement to move to cloud computing / off-site in future years, which will result in some ICT costs shifting from capital to revenue. 7.14 Learning Estate 2026/27 £m 2027/28 £m 2028/29 £m Total £m 33.445 61.817 21.134 116.396 The £116.396m allocated to Learning Estate is primarily for the delivery of the two Learning Estate Investment Programme (LEIP) funded major rebuild/refurbishments at Forres Page 30
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Academy and Elgin High School. The remaining budget covers capital bids to deliver the BB Programme, design feasibility work for Buckie High School, as approved by Education, Children’s and Leisure Services Committee on 25 November 2025 (paragraph X of the minute refers) and compliance works. A reduction of £3.893m has been applied to the 2028/29 budget. This equates to 16% of the requested budget. The Learning Estate accounts for 74% of the 2026-29 Capital Plan (exclusive of major fully funded projects). 7.15 The condition of the Learning Estate is highlighted as a key risk in section 9 of this report. There are significant strategic and operational risks associated with the reduction in capital investment that will impact the existing learning estate delivery strategy. The reduction in capital for year three (2028/29) will need to be further assessed and the service has recently appointed an Asset Manager Advisor who will have responsibility for the development of risk optimised, resilient and affordable future asset management plans for each school which will be presented to the Education, Children’s and Leisure Services. 7.16 Moray Growth Deal 2026/27 £m 2027/28 £m 2028/29 £m Total £m 16.074 14.758 14.261 45.453 The £45.453m allocated to the Moray Growth Deal is based on proposed spend across a suite of projects. Construction works on Cultural Quarter, Business Enterprise Hub, Housing Mix Delivery and EY STEM will form the majority of spend. No cap has been applied to the Moray Growth Deal as this is largely a funded project with the Council’s contribution committed as part of the overall tripartite funding agreement with Scottish and UK Governments. 7.17 Levelling Up Fund 2026/27 £m 2027/28 £m 2028/29 £m Total £m 5.646 10.096 - 15.742 The £15.742m allocated to the Levelling Up Fund is the remaining allowance of the £18.285m funding awarded in November 2024. Three projects will be delivered with this funding - Reimagining Cooper Park, Transforming the Sawmill and a Vibrant Centre, with construction works commencing early 2026/27. No cap has been applied as this is a fully funded initiative. 7.18 Elgin Neighbourhood Board 2026/27 £m 2027/28 £m 2028/29 £m Total £m 0.360 1.602 1.605 3.567 The £3.567m allocated to the Elgin Neighbourhood Board (previously known as Elgin Town Board) is based on the investment plan approved by Council on 6 November 2025 (paragraph 5 of the minute refers). No cap has been applied as this is a fully funded initiative. 8 INDICATIVE PLAN 2030 – 2036 Page 31
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8.1 The indicative 10-year plan is an important component of medium to long term financial planning and serves as a tool to identify spending trends, plan for the future and address affordability issues. Much of this report has focused on the period 2026 – 2029 as this will be approved budget, with years two and three providing greater certainty to budget managers for planning. The figures included from 2030 to 2036 are indicative and subject to change, including the cap. However, it should be noted that to achieve affordability in future years the following assumptions have been made with regards to named project expenditure: 8.2 The Learning Estate budget has been further reduced by £15.000m. A funding bid for £35.000m was made towards the critical refurbishment of secondary schools. The overall indicative budget allocated to the Learning Estate for the period 2026-36 accounts for 56% of the indicative 10-year Capital Plan (exclusive of major fully funded projects i.e. Moray Growth Deal, Levelling Up Fund, etc). 8.3 The Libraries and Leisure budget has been further reduced by £0.940m and relates to a bid on the refurbishment and upgrade of pools. 8.4 The available budget for 2031/32 should be noted. The three-year capital plan for 2026-29 will see a period of ambitious investment for which a subsequent reset year is required to allow a consistent level of expenditure going forward and maintain affordability. The indicative cap applied for 2031/32 is £28.000m. Whilst this is a substantial figure that impacts each asset group, by highlighting it now, any impact can be minimised through careful planning. 9. RISKS AND EMERGING ISSUES 9.1 The following areas are considered to represent risks to the Council’s budget in regard to the Capital Plan for 2026-29 and future years: • Overall Affordability • Future settlements and level of directed of funds • The condition of the Learning Estate • The condition of the Libraries and Leisure Estate • Extreme weather events • Staff capacity and expertise 9.2 Overall Affordability It is recognised that the asset management requirements of the current asset base outstrip the available investment. The established cap on capital is the mechanism to ensure the Capital Plan is affordable, reducing the impact on the revenue budget by keeping financing costs within an agreed threshold. However, the capping mechanism is just a forecasting tool, and at the heart of achieving affordability, and sustainability, over the longer term the Council must look to reduce its core asset base, a message that is well established and carries forward from the previous versions of this report. The Best Value Thematic, as set by the Accounts Commission, for 2025/26 is on asset management and includes a focus on financial sustainability. This further emphasises Page 32
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the priority authorities should be giving to this matter, but also recognises this is a national issue. 9.3 There has been some progress in reducing the asset base in 2025/26. Crossroads Primary School was permanently closed in July 2025. Further development of the Learning Estate Review is underway and a progress report is due to Education, Children’s and Leisure Services Committee in June 2026. The Full Business Case associated with the Depots and Stores Review was approved by Council on 25 June 2025 (paragraph 30 of the minute refers) with a programme of works due to be completed by Q2 2028/29. 9.4 Future settlements and level of directed funds Single year settlements from Scottish Government create uncertainty over future year settlements which can pose a challenge when looking to plan long term in advance. To combat this, only the three-year capital plan is approved, applying a heavy level of prudence to any estimated settlements. By increasing the number shelf ready initiatives, the Council can then take advantage of any additional funding once confirmed. 9.5 The increase in level of directed funds can accelerate change and align spend to Scottish and UK Government priorities. However, it can often redirect capacity within the organisation, particularly staff time. Directed funds can also create additional assets, which subsequently need management and maintaining (which can create revenue pressure). 9.8 The condition of the Learning Estate There are currently 29 schools across the Learning Estate that are below the minimum B-satisfactory condition standard as set out by the Scottish Government. Design and construction projects are underway to upgrade 12 of these schools over the next 2 years and there should be sufficient funding to undertake most of the Phase 1 (Fabric First) and some Mechanical and Electrical works, including some projects to support a transition from fossil to non-fossil sustainable heating upgrade options to deliver this objective. The majority of the indicative 10-year Capital Plan is allocated to the Learning Estate, confirmation that tackling this is a priority. However, given affordability issues it is necessary to develop a strategy to balance the utilisation of the available budget to maximise resilience of the estate in conjunction with optimising routine maintenance, refurbishment, and retrofit. A risk optimised approach to future capital investment is in development. With this risk approach there is a greater risk of further deterioration across the Learning Estate, and a period of managed decline may necessary. 9.9 The condition of the Libraries and Leisure Estate There is a long-standing requirement to review the Leisure Estate to ensure affordability and sustainability of facilities. The Council considered this on 24 September 2025 (paragraph 16 of the minute refers) and agreed a further report is provided to the committee when updated information on the condition of the Moray Sport and Leisure Estate is available and that a critical works programme is developed to help make informed decisions on future prioritisations. This approach incorporated acceptance of the risks of failure associated with it and recognised the affordability challenges. Delaying decisions on capital investment to particular assets is placing risk on the Council as there is an increased likelihood of facility failure. In relation to the Libraries Estate the Council agreed on 19 February 2025 (paragraph 21 of the minute refers) to retain all 11 branches and work up proposals for co-location of services. Further Page 33
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work on co-location has yet to be progressed but will occur in 2026. A review of the condition survey work on the Libraries Estate is scheduled for later this year which will identify a critical works programme to be developed to help make informed decisions on future prioritisation. 9.10 Extreme weather events An increase in the number of extreme weather events continues to add pressure to the Capital Plan. Events such as extended periods of hot or cold weather; flash flooding and strong winds all have an impact on the integrity of the Council’s assets. Capital bids recognise the likelihood of remedial works to landslips however, no allowance has been made in the capital plan to allow for major asset failure. This would need to be absorbed within the relevant asset group. 9.11 Staff capacity and expertise Recruitment continues to be a challenge for Moray Council. Resources being redirected to Scottish or UK Government priorities has already been noted in paragraph 9.5 and this is often at the detriment of planned works – leading to slippage. The complexity of modern civil engineering works also require expertise which cannot be recruited for locally. Much of the 2026-29 Capital Plan delivery is dependent on design work which is designated to in-house architects and quantity surveyors. It is expected that in order to maintain pace of the Capital Plan some works may need to be outsourced as design-and-build contracts. 10 SUMMARY OF IMPLICATIONS 10.1 The table below shows whether risks and implications apply if the recommendations are agreed: SUBJECT YES NO Corporate Plan and 10 Year Plan (Local Outcome Improvement Plan) X Policy and Legal X Financial X Risk X Staffing X Best Value and Transformation X Property X Information Communications Technology/Digital X Equalities. Social Inclusion and Economic Impact X Climate Change and Biodiversity Impact X 10.2 Corporate Plan and 10 Year Plan (Local Outcomes Improvement Plan (LOIP)) Improved Collaborative Leadership, as part of continuous improvement through Best Value, will better enable the Council to fulfil the ambitions set out in its strategic plans. a) Links to Council Corporate Plan – The proposals in this report support and contribute to improved outcomes for communities as outlined in the following Council Plan strategic priorities: ☒ Tackle Poverty and Inequality. Page 34
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☒ Build Stronger Greener Vibrant Economy. ☒ Build Thriving, resilient, empowered Communities. b) Links to Local Outcomes Improvement Plan – The proposals in this report support and contribute to improved outcomes for communities as outlined in the following Local Outcomes Improvement Plan priorities: ☒ Developing a diverse, inclusive, and sustainable economy ☐ Building a better future for our children and young people in Moray. ☒ Empowering and connecting communities. ☐ Improving wellbeing of our population 10.3 Policy and Legal The cap on the Capital Plan indirectly influences several strategies, particularly in terms of delivery pace. These impacts have been highlighted throughout the report, and further detail on reduced capital funding will be presented to individual service committees. 10.4 Financial The financial implications are noted within the body of the report and in the various tables and appendices included within the report. One off Costs: Service Area Budget Budget Years Proposed Spend this Year Virement From Other Comments - - - - - - Annually Recurring Costs: Service Area Budget With Effect From Annual Net Impact Virement From (if applicable) Other Comments - - - - - - 10.5 Risk Unforeseen circumstances can give rise to unplanned capital expenditure. These can range from asset element failures through the impact of extreme weather events to sudden emergence of health and safety issues or accidental damage to one of the Council’s assets by a third party. 10.6 Staffing Staffing implications arise indirectly from this report as much of the capital plan is dependent on Council staff, and competing priorities, revenue and capital, can impact on the ability to deliver planned capital works. 10.7 Best Value and Transformation There are no best value and transformation implications arising directly from this report. Page 35
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10.8 Property There are no property implications arising directly from this report. 10.9 Information Communications/Technology/Digital There are no information communication/technology/digital implications arising directly from this report. 10.10 Equalities, Social Inclusion and Economic Impact There are no equalities issues arising directly from this report. 10.11 Climate Change and Biodiversity Impacts The impact of the cap on capital related to the delivery of the Zero Emission Fleet Replacement strategy has been noted in paragraph 7.3 11. CONSULTATION 11.1 This report has been prepared in consultation with capital budget managers and all Heads of Service and any comments made have been incorporated into the report 12. BACKGROUND PAPERS 12.1 All background papers held by the author within accountancy service. Page 36
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APPENDIX 1 Additional Funding Bids 2026/27 and 2027/28 Asset Class Capital Project Description of project Spend Type Value £000 Financial Year Bridges Arthur's Bridge Ground Investigations and Design Named 570 2026/27 Bridges Arthur's Bridge Bridge Replacement Named 6,590 2027/28 Harbours Cullen West Peir Reparis works to large crack due to movemenet Named 300 2027/28 Fleet Diesel to EV Strategy Re-instate previously agreed budgets before CAP to allow continuation of Fleet Strategy Spend to Save 774 2026/27 Fleet Diesel to EV Strategy Re-instate previously agreed budgets before CAP to allow continuation of Fleet Strategy Spend to Save 949 2027/28 Parks and Open Spaces West Beach Car Park Resinstatement works to West Beach Lossiemouth Car Park in preparation for handing the lease back Core 35 2026/27 Waste Management Upgrade Recycling Centres retained a working capital for maintaining HWRC assets Core 40 2026/27 Waste Management Upgrade Recycling Centres retained a working capital for maintaining HWRC assets Core 40 2027/28 Corporate Buildings Component Replacement Annual budget to be spent on corporate property assets to permit component replacement of items like heating systems, roofs, windows. Core 250 2026/27 Libraries & Leisure Equipment Replacement Replacement of life expired equipment. Core 33 2026/27 Learning Estate BB Programme Budget deficit to cover BB works 27/28 Core 5,000 2027/28 Page 37
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APPENDIX 2 Three-year Capital Plan 2026-29 2026/27 2027/28 2028/29 £000s £000s £000s Fleet and Plant 2,694 2,001 1,837 6,532 Waste Management 124 114 114 352 Property Estate Management 1,317 2,015 2,236 5,568 Roads, Bridges and Street Lighting 5,919 5,018 5,470 16,407 Open Spaces 371 1,143 157 1,671 Flood Risk Management and Coastal Protection 460 - 300 760 Harbours 271 610 166 1,047 Libraries and Leisure 571 5,321 756 6,648 ICT 642 508 315 1,465 Learning Estate 33,445 61,817 21,134 116,396 Moray Growth Deal 16,074 14,758 14,621 45,453 Levelling Up Fund 5,646 10,096 - 15,742 Elgin Neighbourhood Board 360 1,602 1,605 3,567 TOTAL SPEND 67,894 105,003 48,710 221,607 General Capital Grant 7,500 7,500 7,500 22,500 Moray Growth Deal 8,775 9,875 9,875 28,525 Levelling Up Fund 5,646 10,096 - 15,742 Elgin Neighbourhood Board 360 1,602 1,605 3,567 Specific Grant 1,062 - 1,300 2,362 Developers Contributions - - - - Receipts 100 100 100 300 Borrowing 44,451 75,830 28,330 148,611 TOTAL FUNDING 67,894 105,003 48,710 221,607 Asset Group TOTAL £000s Page 38
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Indicative 10 year Capital Plan 2026-36 2026/27 2027/28 2028/29 2029/30 2030/31 2031/32 2032/33 2033/34 2034/35 £000s £000s £000s £000s £000s £000s £000s £000s £000s Fleet and Plant 2,694 2,001 1,837 2,031 2,174 4,065 5,822 2,955 3,158 3,474 30,211 Waste Management 124 114 114 85 137 29 232 359 232 1,106 2,531 Property Estate Management 1,317 2,015 2,236 1,679 2,519 557 1,550 1,380 515 515 14,284 Roads, Bridges and Street Lighting 5,919 5,018 5,470 2,609 4,319 1,136 6,536 6,851 6,166 6,286 50,311 Open Spaces 371 1,143 157 114 178 6,037 285 285 285 285 9,140 Flood Risk Management and Coastal Protection 460 - 300 1,508 4,400 64 - 250 - - 6,983 Harbours 271 610 166 120 562 539 5,300 15,650 650 350 24,217 Libraries and Leisure 571 5,321 756 88 37 8 160 60 60 60 7,121 ICT 642 508 315 141 351 65 502 502 502 502 4,029 Learning Estate 33,445 61,817 21,134 6,482 6,359 1,313 15,190 15,190 15,190 15,190 191,310 Moray Growth Deal 16,074 14,758 14,621 8,336 1,282 1,262 35 - 417 - 56,785 Levelling Up Fund 5,646 10,096 - - - - - - - - 15,742 Elgin Neighbourhood Board 360 1,602 1,605 1,605 1,605 1,605 1,605 1,605 1,605 1,739 14,936 TOTAL SPEND 67,894 105,003 48,710 24,799 23,923 16,680 37,217 45,087 28,780 29,507 427,600 General Capital Grant 7,500 7,500 7,500 7,725 7,957 8,195 8,441 8,695 8,955 9,224 81,693 Moray Growth Deal 8,775 9,875 9,875 5,700 5,470 1,462 17,331 - - - 58,488 Levelling Up Fund 5,646 10,096 - 15,742 Elgin Neighbourhood Board 360 1,602 1,605 1,605 1,605 1,605 1,605 1,605 1,605 1,739 14,936 Specific Grant 1,062 - 1,300 - - - - - - - 2,362 Developers Contributions - - - - - - - - - - - Receipts 100 100 100 100 100 100 100 100 100 100 1,000 Borrowing 44,451 75,830 28,330 9,669 8,791 5,318 9,740 34,687 18,120 18,444 253,380 TOTAL FUNDING 67,894 105,003 48,710 24,799 23,923 16,680 37,217 45,087 28,780 29,507 427,600 Asset Group 2035/36 £000 10 year Total £000 APPENDIX 3 Page 39
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APPENDIX 4 Application of Cap on Capital 2028/29 2029/30 2030/31 2031/32 2032/33 2033/34 2034/35 2028/29 2029/30 2030/31 2031/32 2032/33 2033/34 2034/35 2028/29 2029/30 2030/31 2031/32 2032/33 2033/34 2034/35 2028/29 2029/30 2030/31 2031/32 2032/33 2033/34 2034/35 £000s £000s £000s £000s £000s £000s £000s £000s £000s £000s £000s £000s £000s £000s £000s £000s £000s £000s £000s £000s £000s £000s £000s £000s £000s £000s £000s £000s Fleet and Plant Core 1,391 2,303 2,950 2,950 4,244 2,950 2,950 3,474 -623 -1380 -1109 -2570 768 923 1,841 380 4,244 2,950 2,950 3,474 Named - - - - - - - - - - - - - - - - Spend to Save 1,069 1,108 333 3,685 1,578 5 208 - 1,069 1,108 333 3,685 1,578 5 208 - Funded - - - - - - - - - - - - - - - - Waste Management Core 206 212 219 225 232 359 232 240 -92 -127 -82 -196 114 85 137 29 232 359 232 240 Named - - - - - - - 866 - - - - - - - 866 Spend to Save - - - - - - - - - - - - - - - - Funded - - - - - - - - - - - - - - - - Property Estate Management Core 519 1,820 3,185 2,575 1,300 1,130 265 265 -233 -1091 -1197 -2243 286 729 1,988 332 1,300 1,130 265 265 Named - - - - - - - - - - - - - - - - Spend to Save 1,950 950 531 225 250 250 250 250 1,950 950 531 225 250 250 250 250 Funded - - - - - - - - - - - - - - - - Roads, Bridges and Street Lighting Core 8,098 6,510 6,921 8,816 6,536 6,851 6,166 6,286 -3628 -3901 -2602 -7680 4,470 2,609 4,319 1,136 6,536 6,851 6,166 6,286 Named - - - - - - - - - - - - - - - - Spend to Save - - - - - - - - - - - - - - - - Funded 1,000 - 1,000 - - - - - - - Open Spaces Core 285 285 285 285 285 285 285 285 -128 -171 -107 -248 157 114 178 37 285 285 285 285 Named - - - 6,000 - - - - - - - 6,000 - - - - Spend to Save - - - - - - - - - - - - - - - - Funded - - - - - - - - - - - - - - - - Flood Risk Management Core - 250 - 500 - - - - 0 -150 0 -436 - 100 - 64 - - - - and Coastal Protection Named - - - - - - - - - - - - - - - - Spend to Save - - - - - - - - - - - - - - - - Funded 300 1,408 4,400 - - 250 - - 300 1,408 4,400 - - 250 - - Harbours Core 300 300 900 300 300 650 650 350 -134 -180 -338 -261 166 120 562 39 300 650 650 350 Named - - - 500 5,000 15,000 - - - - - 500 5,000 15,000 - - Spend to Save - - - - - - - - - - - - - - - - Funded - - - - - - - - - - - - - - - - Libraries and Leisure Core 1,369 71 60 60 160 60 60 60 -613 -43 -23 -52 356 412- 463- 8 160 60 60 60 Named 400 500 500 - - - - - -400 -440 -500 400 500 500 - - - - - Spend to Save - - - - - - - - - - - - - - - - Funded - - - - - - - - - - - - - - - - ICT Core 570 351 562 502 502 502 502 502 -255 -211 -211 -437 315 141 351 65 502 502 502 502 Named - - - - - - - - - - - - - - - - Spend to Save - - - - - - - - - - - - - - - - Funded - - - - - - - - - - - - - - - - Learning Estate Core 8,690 7,190 10,190 10,190 10,190 10,190 10,190 10,190 -3893 -4308 -3831 -8877 4,797 2,882 6,359 1,313 10,190 10,190 10,190 10,190 Named 16,337 8,600 5,000 5,000 5,000 5,000 5,000 5,000 -5000 -5000 -5000 16,337 3,600 - - 5,000 5,000 5,000 5,000 Spend to Save - - - - - - - - - - - - - - - - Funded - - - - - - - - - - - - - - - - Moray Growth Deal Funded 12,886 7,647 589 536 - - - - 12,886 7,647 589 536 - - - - Funded - MC Cont 1,735 689 693 726 35 - 417 - 1,735 689 693 726 35 - 417 - Levelling Up Fund Funded - - - - - - - - - - - - - - - - Elgin Neighbourhood Board Funded 1,605 1,605 1,605 1,605 1,605 1,605 1,605 1,739 1,605 1,605 1,605 1,605 1,605 1,605 1,605 1,739 58,710 41,799 38,923 44,680 37,217 45,087 28,780 29,507 400- 5,440- 5,500- 5,000- - - - - -9600 -11560 -9500 -23000 47,942 23,876 22,082 16,300 32,973 42,137 25,830 26,033 2035/36 £000 2035/36 £000 BEFORE CAP CAP ON NAMED EXPENDITURE CAP ON CORE EXPENDITURE AFTER CAP Asset Group 2035/36 £000 2035/36 £000 Page 40
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Report to: Moray Council Meeting Date: 28 January 2026 Report by: Chief Executive Author: Lorraine Paisey Contact Email: Lorraine.paisey@moray.gov.uk Subject: Charging for Services 2026/27 1. PURPOSE ☒ For Decision ☐ For Information 1.1 The purpose of this report is to ask Council to approve revised charges for Council services for 2026/27. 1.2 This report is submitted to Council in terms of Section III (B) (1) and (48) of the Council's Scheme of Administration relating to financial policy and the setting of charges. 2. SUMMARY 2.1 The Council’s current Charging for Services Policy includes provision that the default increase for charges within the Council’s control for 2026/27 will be the Consumer Price Index including owner occupiers housing costs (CPIH) as at the October prior to the start of the financial year plus 1% - 4.8%. This report sets out the reasons for any proposed departures from that Policy position. 3. RECOMMENDATIONS. 3.1 It is recommended that Council: i) approves the charges for Council services for 2026/27 set out in paragraphs 5.1 to 5.10 and listed in APPENDIX 1; ii) notes that electric vehicles chargers are migrating to a private consortium and the Council will no longer take charges for use of EV charging points; and iii) notes the complete list of charges including those uplifted by the default of 4.8% and those outwith the control of the Council Lorraine Paisey Chief Financial Officer Item 7. Page 43
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4. BACKGROUND AND CONTEXT 4.1 The current Charging for Services Policy was approved by Council on 12 December 2023 (paragraph 7 of the draft Minute refers). Under the policy, an annual revision of charges is required. In order to preserve the Council’s financial position, charges within the control of this council generally have an inflation uplift applied each year. As part of the approved Charging for Services Policy Council agreed that the default increase for 2024/25 to 2026/27 would be the Consumer Price Index including owner occupiers housing costs (CPIH) as at the October prior to the start of the financial year plus 1%. CPIH published in October 2025 was 3.8% (figures are published a month in arrears). Consequently for 2026/27 the default increase in charges for services is 4.8%. 4.2 Per the Policy, charges which have had the default increase applied to them do not require to be brought back to Council for approval. Only charges which depart from the default position require approval by Council. 4.3 The Charging for Services Policy assumes a default position of full cost recovery, recognising that there will be exceptions to that rule. In cases where the Council offers a service where there are alternative service providers then market conditions should be taken into account. In other instances benchmarking with other local authorities may be a good test of reasonableness. There may be policy reasons for charging at less than full cost recovery for some services. However, charging for services is an important tool when considering the Council’s overall budget as maximising income helps to reduce the need to make savings by service reduction. 4.4 Not all charges are within the Council’s control. Some charges levied by the Council for services provided are set by statute, some are limited by statute and some have the method of calculation prescribed by statute – these are included in the list of charges for Council services for the sake of completeness. 4.5 The reason behind any recommended charges for 2026/27 not recommended to be increased by 4.8% (with rounding up or down if appropriate), where these are within the Council’s control, are discussed on a section-by-section basis below. A full list of charges is provided in the separate Information Report on Charging for Services published with the meeting agenda. 5. PROPOSALS 5.1 A: Corporate/cross departmental Most charges within the control of the Council are proposed to be increased by the default of 4.8%. The exception is charges for photocopying, where it is deemed impractical to increase small charges incrementally each year and no increase is recommended for 2026/27. 5.2 B: Social Care Services The Council delivers social care in partnership with NHS Grampian as directed by Moray Integration Joint Board (MIJB). The ability to set charges is a function of the Council and not of MIJB. However, as in previous years the Council has requested MIJB to make recommendations regarding the level of charges, so that a holistic view can be taken of Page 44
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charges for social care and their relation to service issues, and in the spirit of partnership working. Contributions towards social care services, which are generally means tested (as opposed to charges which are flat rate) fall within the remit of MIJB. The recommended charges are generally increased by the default level of 4.8%. A new charge – B4a – of £20 for a replacement Blue Badge is recommended. 5.3 C: Leisure facilities The recommended exceptions to the default rate are: C1a/b – Fit Life Memberships. The Council has worked in partnership with Moray Leisure Centre (MLC) on the recommended charges, which equate to between 8-12% increase. Based on national benchmarking the current charges are among the cheapest leisure memberships nationally. The increase is designed to generate additional income and make both MLC and the Council leisure services more sustainable. The impact of the new prices will be monitored closely and if the increase results in a major reduction in membership levels this will be reported to committee. C1d – no increase is recommended. The visitor membership for 7 days needs to be attractive (£14) as a visitor membership is easier to process than setting up a direct debit for one month. If a visitor took out a membership for 14 days (£28) they would pay more than an individual membership for one month. C2b – Junior Lesson Block, Holiday Crash Course and Parent and Child Class are all recommended to be increased by 10%, mirroring the recommended increase in Fit Life membership, to encourage families to take out Fit Life Memberships rather than only pay for swimming lesson blocks. C4b – Pitches and pavilions. Charges are recommended to remain at 2025/26 levels as these facilities are generally in poor condition and the subject of regular complaints from users. With limited resources to maintain pitches and limited investment in these facilities it is considered that an increase in charges is difficult to justify. C5a – School facilities. An increase of between 8-10% is recommended as this service does not break even. With this increase prices are still on par with other facility hires. C9b – Shower. Very rare that this is provided and an 8% increase is recommended. 5.4 D: Libraries and Information Services The recommended exceptions to the default increase are: D1d – replacement computer card. No increase is recommended as the current rate covers costs with a small margin and aligns with Fit Life membership card replacement cost so retained for consistency across Leisure and Libraries services. D1g – Staff supported digital scanning/emailing charge. It is proposed that the charge is changed to a flat rate charge of £2.50 rather than an initial fee then per sheet to streamline administration. Page 45
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5.5 E: Education E2 – Moray Music Centre. The proposal for this programme is to increase the charge by the set default position. However, this programme is required to be fully cost recoverable per the council charging policy. Therefore this increase is an interim arrangement pending consideration by the Council of how to deliver this and consultation taking place on any proposed changes with existing programme users therefore the cost and service model may be subject to future change. E3 – school meals. An increase of 4.8% in the charge for meals in primary schools would be 13p. Experience shows an uplift of 10p resulted in reduced uptake. An increase of 5p is recommended to maintain the uptake of meals. 5.6 F: Economic Growth and Development Services A new charge for Certificates of Compliance for mobile vendors is proposed (F1i) at £128. The service estimate the work involved in awarding certificates of compliance is similar to the work involved in Support Attestations (F1g) and so a charge of £128 is recommended. Benchmarking indicates that this is comparable to other local authorities. 5.7 G: Waste Management, Open Space The recommended exceptions to the default increase are: G1b – collection of bulky household items. Increase of 10% to £44 is recommended, based on the current demand for the service. The service considers that the increased charge continues to provide value for money. G1g - Trade Waste recycling pass. An increase of 25% to £500 is recommended as a disincentive for traders to use the Household Waste Recycling Centres (HWRC). Use of HWRCs by traders puts pressure on this service. Kerbside collections is the preferred mode of trade waste collection. G1j - Commercial green waste disposal. An increase of around 9% to £60 is proposed, based on the service assessment of what the market can take. G1l - Household green waste. A reduction of below the default rate to £54 is proposed, recognising that significant jumps in cost impact on uptake. G2a – G2e – Burial Charges. In order to achieve full costs recovery as approved by Council at its meeting on 25 October 2023 (paragraph 14 of the Minute refers) increase in charges above the default rate is required. There are three reasons for this: a reduction in the number of interments / sale of lairs from that originally projected; increased exemptions from out of area charges; the cost of a new digital burial administration system. The proposed costs have been benchmarked with other local authorities. The Council’s lair fee are currently highest 11th in Scotland; compared to 2025/26 the recommended fee for sale of a lair would place the Council 5th highest in Scotland. It is unlikely that all other authorities will freeze their lair fees. The Council’s interment fees are currently the highest in Scotland and with the second and third highest £38 and £87 lower than the Council’s 2025/26 charge the Council is likely to remain highest in Scotland. It is not known if other local authorities are achieving full costs recovery. Page 46
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G2a - In addition, from 1 April 2026, in line with the Burial and Cremation (Scotland) Act 2016, the exclusive right of burial, and the right to erect a headstone, will only be for a period of 25 years, though extensions can be granted. New charges, based on the current transfer fee, have been included from 2026/27 as charges for processing future applications to extend the exclusive right of burial period. 5.8 H: Fleet, roads and transportation New charges are proposed for temporary directional signage for commercial purposed (H2i) - £195. New parking charges are also proposed for Heavy Goods Vehicles and oversize vehicles (ie those occupying more than one space) at Lossie Green (£7 daily and £80 monthly season ticket) and Keith lorry park (£5 daily and £60 monthly season ticket) - H3h. It is recommended that trading permits are issued for traders trading within car parks (H3i): in Elgin (£200 daily and £600 monthly) and in other car parks (£150 daily and £400 monthly), reflecting lower footfall. No changes are recommended for most car parking charges, as it is not economical to change the meters on an annual basis and also the latest set of charges are relatively new and need to bed in before any amendments are recommended. The exception to this is season tickets (H3g) at low turnover car parks and Elgin railway station, which are recommended to be increased by the default rate, as is the charge for opening multi- storey car parks outwith opening times. The charge for a duplicate school bus pass (H5c) has not been increased for 8 years and it is recommended that this is increased from £15 to £16. Community bus fares (H5d) were increased by 33% in 2025/26 and so no increase is recommended for 2026/27. 5.9 I: Harbours All charges have been uplifted by the default increase rounded upwards. 5.10 K: Housing and Property All charges have been uplifted by the default increase. 6. SUMMARY OF IMPLICATIONS 6.1 The table below shows whether risks and implications apply if the recommendations are agreed: SUBJECT YES NO Corporate Plan and 10 Year Plan (Local Outcome Improvement Plan) ✓ Policy and Legal ✓ Financial ✓ Risk ✓ Staffing ✓ Best Value and Transformation ✓ Page 47
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Property ✓ Information Communications Technology/Digital ✓ Equalities. Social Inclusion and Economic Impact ✓ Climate Change and Biodiversity Impact ✓ 6.2 Corporate Plan and 10 Year Plan (Local Outcomes Improvement Plan (LOIP)) Improved Collaborative Leadership, as part of continuous improvement through Best Value, will better enable the Council to fulfil the ambitions set out in its strategic plans. a) Links to Council Corporate Plan – The proposals in this report support and contribute to improved outcomes for communities as outlined in the following Council Plan strategic priorities: ☐ Tackle Poverty and Inequality. ☐ Build Stronger Greener Vibrant Economy. ☐ Build Thriving, resilient, empowered Communities. b) Links to Local Outcomes Improvement Plan – The proposals in this report support and contribute to improved outcomes for communities as outlined in the following Local Outcomes Improvement Plan priorities: ☐ Developing a diverse, inclusive, and sustainable economy ☐ Building a better future for our children and young people in Moray. ☐ Empowering and connecting communities. ☐ Improving wellbeing of our population 6.3 Policy and Legal The current policy for charging for Council services was approved by the Council on 25 October 2023. There are no legal implications arising from this report. Some charges levied by the Council are set or limited by legislation. 6.4 Financial Increased income from charges will contribute to the Council’s financial sustainability. One off Costs: Service Area Budget Budget Years Proposed Spend this Year Virement From Other Comments Annually Recurring Costs: Service Area Budget With Effect From Annual Net Impact Virement From (if applicable) Other Comments 6.5 Risk There are no risk implications arising directly from this report. Page 48
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6.6 Staffing There are no staffing implications arising directly from this report. 6.7 Best Value and Transformation There are no implications arising from this report. 6.8 Property There are no property implications arising from this report. 6.9 Information Communications/Technology/Digital There are no implications arising from this report. 6.10 Equalities, Social Inclusion and Economic Impact There are no equalities implications or implications for the socio-economic duty arising from this report. 6.11 Climate Change and Biodiversity Impacts There are no implications for climate change or biodiversity arising from this report. 7. CONSULTATION 7.1 This report has been prepared in consultation with all services as to recommended charges and reasons for any departures from the default increase. Heads of Service have been consulted in the preparation of this report. 8. BACKGROUND PAPERS 8.1 None. Page 49
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APPENDIX 1 SECTION A: CORPORATE SERVICES / CROSS DEPARTMENTAL CODE: S Set by Statute/Scottish Government M At legal maximum SD Statutory duty of full cost recovery REF SERVICE CODE S/M/SD BUDGET 2025/26 CHARGE 2025/26 CHARGE 2026/27 DATE OF LAST CHANGE A18. Photocopying A4 Black & white A3 Black & white A4 colour A3 colour Plus staff costs £nil 15p 30p 45p 90p Up to £20 per person per hour 15p 30p 45p 90p Up to £21 per person per hour April 2023 April 2023 April 2023 April 2025 April 2023 Page 50
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SECTION B: SOCIAL CARE – MIJB and Moray Training REF SERVICE CODE S/M/SD BUDGET 2025/26 CHARGE 2025/26 CHARGE 2026/27 DATE OF LAST CHANGE B4a Blue badge – charge for replacement badge N/A £20 New Page 51
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SECTION C: LEISURE FACILITIES REF SERVICE CODE S/M/SD BUDGET 2025/26 CHARGE 2025/26 CHARGE 2026/27 DATE OF LAST CHANGE C1 Fit Life £ C1a. C1b. Membership cards Individual – 12 months Individual – monthly direct debit Family (1 adult) – 12 months Family (1 adult) – monthly direct debit Family (2 adults) – 12 months Family (2 adults) – monthly direct debit £ £300 £25 £396 £33 £444 £37 £312 £27 £432 £37 £492 £41 April 2025 April 2025 April 2025 C1d. Visitor membership for minimum of 7 days 7 day minimum £14 28 day maximum £56 7 day minimum £14 28 day maximum £56 April 2025 C1e. Employee Wellbeing (Business) Membership 12mths for the price of 10mths (ie for an individual this would be £250 for a year’s membership instead of £300) Based on 10% reduction on monthly fee dependant on type of membership April 2025 C2 Swimming Pools Page 52
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REF SERVICE CODE S/M/SD BUDGET 2025/26 CHARGE 2025/26 CHARGE 2026/27 DATE OF LAST CHANGE C2b. Swimming Lessons Adult Lesson Junior Lesson block (8 weeks) Holiday Crash Course (5 x daily lessons) Parent and Child Class (1 adult & 1 child) Individual junior lesson (30 minutes for 1 child) Additional needs child individual lesson (30 minutes for 1 child) £ £8.50 £56 £35 £7 £20 £14 £9.00 £62.00 £38.75 £7.75 £21 £14.70 April 2024 April 2025 C4 Outdoor Sports C4b. Pavilions and Pitches Football and School sports field with changing rooms Adult Teams per Game Juvenile Teams (Under 17) per Game £ £75 £27.50 £75 £27.50 April 2024 C5. School facilities £ C5a. Meeting Room – per hour Community (small – capacity 1-10 people) Community (medium – capacity 11-50 people) Community (large – capacity 51+ people) Private/commercial (small – capacity 1-10 people) £ £12 £15.50 £21.50 £23.80 £13 £16.75 £23.25 £26.25 April 2025 Page 53
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REF SERVICE CODE S/M/SD BUDGET 2025/26 CHARGE 2025/26 CHARGE 2026/27 DATE OF LAST CHANGE Private/commercial (medium – capacity 11-50 people) Private/commercial (large – capacity 51+ people) Requests for bookings can be considered out-with normal hours at an additional cost of £X per booking per hour £30.80 £42.50 £25 £34.00 £46.75 £27.50 C9 Community Centres C9b C9c Shower Use of photocopier (A4 black and white) £ £3 Please See Section A18 £3.25 Please See Section A18 April 2025 Page 54
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SECTION D: LIBRARIES AND INFORMATION SERVICES REF SERVICE CODE S/M/SD BUDGET 2025/26 CHARGE 2025/26 CHARGE 2026/27 DATE OF LAST CHANGE D1 Libraries and Information Services £ D1d Reader’s Tickets – Replacement Computer Card £ £1.50 £1.50 April 2023 D1g Photocopies: Per A4 copy b/w Per A3 copy b/w Per A4 copy colour Per A3 copy colour Microfilm/fiche per A4 sheet Internet: Computer printouts Computer printouts (colour) Staff supported digital scanning/emailing charge £ £ Please See Section A18 £2.50 £0.15 £0.45 £2.30 for first sheet Please See Section A18 £2.65 Align with Section A18 £2.50 April 2023 April 2023 April 2023 April 2025 Page 55
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SECTION E: EDUCATION REF SERVICE CODE S/M/SD BUDGET 2025/26 CHARGE 2025/26 CHARGE 2026/27 DATE OF LAST CHANGE E2 MORAY MUSIC CENTRE Moray Music Centre weekly fee £ £6.50 £6.80 April 2025 E3. SCHOOL MEALS Primary School Meals Secondary School meals are priced per item selected £ £ £2.50 Cafeteria system – charge per item £2.55 Cafeteria system – charge per item Priced individually and will be uplifted an average by 5.7% (to the nearest 5p). Head of Service has delegated authority on pricing to balance income and uptake item. Free school meal allowance is £2.90 April 2025 Page 56
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SECTION F: ECONOMIC GROWTH AND DEVELOPMENT SERVICES REF SERVICE CODE S/M/SD BUDGET 2025/26 CHARGE 2025/26 CHARGE 2026/27 DATE OF LAST CHANGE F1 Environmental Health F1i Section 50 (Licensing) Food Hygiene Certificate £ £106.03 £111 April 2025 Cooksafe Books (per book + p&p) £6.32 £6.62 April 2025 Butchersafe Books (per book + p&p) £6.32 £6.62 April 2025 Certificate of Compliance for Mobile Traders £122 £128 April 2025 Page 57
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SECTION G: WASTE MANAGEMENT, LAND AND PARKS REF SERVICE CODE S/M/SD BUDGET 2025/26 CHARGE 2025/26 CHARGE 2026/27 DATE OF LAST CHANGE G1 Waste collection and disposal All charge are net of VAT G1b Collection of bulky household refuse (white and non-white goods) £ £40 £44 April 2025 G1g. Recycling Centre Pass £400 £500 April 2025 G1j. Disposal of green waste from landscape gardeners per tonne £ £55 £60 April 2025 G1l Household garden waste permits, per annum per bin £ £52 £54 April 2025 G2 Burial Grounds All charges are net of VAT G2a. Sale of Lair (right of burial for a period of 25 years) Resident Sale of Lair Non-Resident Sale of Lair Fee for transfer of lair Non-Resident Fee for transfer of Lair Fee for the extension of the right of burial and headstone (effective from 25 years from purchase date) £137,844 £1,311 £2,776 £73 £144 £1451 £3072 £85 £168 £85 April 2025 April 2025 April 2025 April 2025 New Charge Page 58
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REF SERVICE CODE S/M/SD BUDGET 2025/26 CHARGE 2025/26 CHARGE 2026/27 DATE OF LAST CHANGE G2b. Interment Charges Under 18 years of age Over 18 years of age Fee for 2nd/3rd interment for Non-Moray Resident Fee for Non-Moray Resident £744,359 Nil £1,495 £1,495 £2,745 Nil £1643 £1643 £3016 April 2025 G2c. Additional charge for interments Saturday (18 years and over) Non-Moray Resident Sunday (18 years and over) Non-Moray Resident Included above £748 £1,373 £1,495 £2,745 £822 £1508 £1643 £3016 April 2025 G2d. Purchase of Cremated Remains Lair in Garden of Remembrance Non-Moray Residents Fee for interment of casket Fee for 2nd/3rd interment for Non-Moray Resident Fee for Non-Moray Resident Additional charge for Caskets: Saturday Non-Moray Resident Sunday Non-Moray Resident Scattering of Ashes on Grave Non-Moray Resident Included above £753 £1,702 £353 £353 £802 £177 £401 £353 £802 £85 £833 £1883 £388 £388 £881 £194 £441 £388 £881 £99 April 2025 Page 59
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REF SERVICE CODE S/M/SD BUDGET 2025/26 CHARGE 2025/26 CHARGE 2026/27 DATE OF LAST CHANGE £170 £198 G2e. Fee for digging foundations for headstone (18 and over) Non-Resident Fee for digging foundations for headstone Under 18s years of age £36,758 £175 £504 NIL £204 £587 NIL April 2025 Page 60
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SECTION H: FLEET, ROADS AND TRANSPORTATION REF SERVICE CODE S/M/SD BUDGET 2025/26 CHARGE 2025/26 CHARGE 2026/27 DATE OF LAST CHANGE H2 Roads All charges are net of VAT H2i AA Temporary Directional Signage Signage placed on Roads Infrastructure for commercial purposes. Signage placed on Roads Infrastructure for Public sector e.g. Covid Vaccination Centres n/a n/a £195 No Charge NEW NEW H3. CAR PARKING CHARGES £ Inclusive of VAT H3g Season Tickets includes VAT High Turnover Site Medium Turnover Site Elgin Railway Station Low Turnover Site Charge for opening multi storey car parks outwith opening hours £ n/a no all day parking £50 £40 £40 £73 n/a no all day parking £50 £42 £42 £76.50 January 2024 May 2018 January 2024 April 2025 H3h HGV & Oversize Vehicles Lossie Green Daily Charge n/a £7 New Charge Page 61
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REF SERVICE CODE S/M/SD BUDGET 2025/26 CHARGE 2025/26 CHARGE 2026/27 DATE OF LAST CHANGE Monthly (Season) Keith Lorry Park & Other Car Parks, subject to assessment & application Daily Charge Monthly (Season) (Applies to vehicles occupying more than one car bay or a designated HGV bay) n/a n/a n/a £80 £5 £60 New Charge New Charge New Charge H3i Trading Permit (Within Car Parks) Elgin Car Parks Daily Monthly Other Car Parks Daily Monthly n/a n/a n/a n/a £200 £600 £150 £400 New New New New H5 Public Transport Unit Page 62
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REF SERVICE CODE S/M/SD BUDGET 2025/26 CHARGE 2025/26 CHARGE 2026/27 DATE OF LAST CHANGE H5c Duplicate school bus pass £15 £16.00 August 2018 H5d Community bus fares £ Adult Single £4- £10 Adult Return £7- £10 10 Journeys £25- £41 Annual £1,000 - £1,624 Adult Single £4- £10 Adult Return £7- £10 10 Journeys £25- £41 Annual £1,000 - £1,624 April 2025 Page 63
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Report to: Moray Council Meeting Date: 28 January 2026 Report by: Executive Director Economy, Enterprise and Operations Author: George Gunn Contact Email: george.gunn@moray.gov.uk Subject: Just Transition Fund Project Shortlist 1. PURPOSE ☒ For Decision ☐ For Information 1.1 The purpose of this report is to seek approval of a proposed shortlist of projects to be developed into a funding bid to the Scottish Government’s North East Just Transition Fund, and to agree next steps. 1.2 This report is submitted to Council in terms of Section III (F) (2) of the Council’s Scheme of Administration relating to provision, development and monitoring of Economic Development and Infrastructure Services. 2. RECOMMENDATIONS It is recommended that Council: i) Notes the progress made since August 2025 to advance Moray’s position for future funding from the Scottish Government’s £500m Just Transition Fund; ii) Approves the proposed shortlist of projects for further development and inclusion in a bid to the Just Transition Fund; iii) Agrees to delegate authority to the Executive Director Economy, Enterprise and Operations to submit the bid to the Just Transition Fund should timing preclude committee approval; iv) Notes the potential financial implications outlined in Section 12.3, should the bid progress beyond the expression of interest stage and require further detailed project development; v) Agrees that the Council Leader and Officers should continue to engage with Moray’s MPs and MSPs on work to date and the needs of Moray in respect of a just transition; and Item 8. Page 65
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vi) Agrees that Officers should engage with the Joint Community Councils of Moray (JCC) to raise awareness of the ongoing work to develop a Just Transition bid for Moray. George Gunn FRGS Senior Project Officer 3. BACKGROUND AND CONTEXT 3.1 The concept of just transition is broadly defined as ensuring that no one is left behind in the transition to low-carbon and environmentally sustainable economies and societies. The Scottish Government’s Just Transition Fund, launched in 2021, is a £500m ten-year commitment to support projects in the North East and Moray which contribute towards a just transition away from carbon-intensive industries. The fund represents a significant economic opportunity for Moray with the potential for the creation of jobs, support for innovation and enterprise, and the development and maintenance of a skilled workforce. 3.2 Additional resourcing was agreed by the Council on 26 February 2025 for a Grade 11 Senior Project Officer to be employed for a 2-year period to lead on project development for the Just Transition Fund (para 3 of the Minute refers). The Scottish Government opened the Just Transition Fund for 2025/26 applications in May 2025. Due to the ongoing recruitment process and consequent lack of resource at that time, the Council was unable to prepare a funding bid. Recruitment to this post was completed in August 2025. 3.3 On 27 August 2025, the Council approved a Just Transition Vision for Moray, with a set of project selection criteria designed to reflect the region’s distinct socio-economic challenges and strategic opportunities (para 11 of the Minute refers). These criteria were developed to assist Officers in preparing a shortlist of Just Transition Fund projects for potential inclusion in a Moray-wide bid to the Fund. An engagement workshop was held with Elected Members on the Vision and emerging project ideas. 3.4 Following approval by the Council, Officers have worked with key stakeholders to further develop the emerging project ideas shared in August. This has included the formation of project subgroups to develop ideas to a level suitable for shortlisting. 3.5 Funding allocations for 2025/26 were announced in September 2025. No awards were made to Moray-based projects in this round. Officers have engaged with groups across Moray, all of whom cited limited capacity and/or the inability to apply for revenue funding as key barriers to participation in the funding round. In addition, Officers have met with organisations that submitted unsuccessful bids to gather feedback, identify lessons learned and explore opportunities for collaboration to inform engagement with the Scottish Government and to strengthen future Moray applications. Officers have also attended a feedback session with Just Transition Fund officials and met with Just Transition Commissioners who were conducting an inquiry into the Just Transition Fund to date, during which the need for multi-year funding with capital and revenue expenditure was consistently expressed. 3.6 A meeting between the Council Leader and the Cabinet Secretary for Climate Action and Energy, Gillian Martin MSP, was originally scheduled to take place prior to the preparation Page 66
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of this report but was postponed by the Scottish Government. At the time of writing, the meeting was expected to take place on 21 January 2026 to discuss the future design, structure, and delivery mechanisms of the Fund in the context of Moray’s specific circumstances, and to provide an overview of emerging projects. 3.7 Following a briefing on the proposed shortlist of projects with elected members on 9 December 2025, an initial roundtable session for MPs and MSPs was held on 8 January 2026. Parliamentarians were provided with a prospectus outlining the proposed shortlist of projects, and the changes required to the Fund to enable these to be progressed in a manner which delivers maximum strategic benefit for Moray. 4. SHORTLISTING OF PROJECTS 4.1 As agreed by the Council in August 2025 (para 11 of the Minute refers), Officers applied a structured set of criteria to identify, develop and prioritise potential projects that align with the Just Transition vision, reflect Moray’s distinctive economic and social circumstances, and benefit the whole of Moray. 4.2 Projects have been shortlisted based on their ability to: • Build on the region’s distinctive assets, such as its distilling industry, natural capital, harbours, and skilled workforce; • Support SMEs and supply chains in net zero innovation and retrofitting; • Demonstrate replicable approaches to rural decarbonisation, energy efficiency and land use; • Engage communities and third sector partners in project delivery and co-design; and • Address demographic challenges through youth retention, skills development and employment pathways linked to net zero sectors. 4.3 In addition, three cross-cutting themes were embedded in the selection process to ensure the portfolio of projects delivers wide and inclusive benefits: • Community – all projects should include provisions for local communities to engage with, inform, and contribute to delivery; • Small and Medium-sized Enterprises (SMEs) – all projects should set out how they will engage and support the development of Moray-based SMEs; and • Skills, employment and training – all projects should include provision for training, employment and development opportunities for local people. 4.4 Projects were developed to build on work funded in earlier Just Transition rounds. In several cases, proposals also drew on extensive prior community engagement, including the Buckie Harbour Masterplan, Mosstodloch Masterplan, Moray Local Heat and Energy Efficiency Strategy (LHEES), Moray Local Development Plan, and Moray Hydrogen Strategy. Officers also liaised with colleagues working on the Moray Growth Deal to ensure that projects complement existing work and respond to identified skills gaps and opportunities. Following further development work, assessment against these criteria and consultation with stakeholders including UHI Moray, the Findhorn Watershed Initiative, Spey Catchment Initiative, Deveron, Bogie and Isla Rivers Charitable Trust, Crown Estate Scotland, Highlands and Islands Enterprise, Scottish Forestry, Moray CAN, Zero Carbon Page 67
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Moray, Community Energy Moray, BE-ST and Mott MacDonald, six projects have been shortlisted for further development into a potential Moray-wide Just Transition Fund bid. These are: • Buckie Harbour Expansion; • Moray Natural Capital Enhancement and Skills Partnership; • Buildings for the Future; • Moray Community Solar; • Green Energy and Employment Parks; and • Moray Hydrogen Transport Project. 4.5 These projects will form a coherent, Moray-wide programme that directly reflects the region’s priorities and long-term transition needs. The projects collectively address the strategic challenges facing Moray while enabling communities, SMEs, and the local workforce to benefit from emerging net zero opportunities. As a partnership with stakeholders, the package will position Moray to secure new investment, capitalise on future economic growth, and deliver a just transition for workers across the region. Subject to further development work in conjunction with partners, it is estimated that the total combined bid will be approximately £80.7m including project management office (PMO) and support service costs. This preparatory work will also ensure that the programme is sufficiently advanced to maintain momentum and respond effectively to future investment opportunities as they arise. 5. BUCKIE HARBOUR EXPANSION 5.1 This project would be led by the Council, supported by a dedicated project manager and specialist external consultants with relevant expertise in major port infrastructure, environmental assessment, marine engineering and business case development. 5.2 The Buckie Harbour Expansion project would aim to begin works to establish Buckie as a key hub for Scotland’s offshore renewables and low-carbon industries while supporting traditional marine sectors. Buckie is the nearest operational harbour to the Moray Firth offshore wind farms, which will generate 3.8GW of power over the next 50 years, but the current harbour infrastructure cannot accommodate the size and type of vessels required to service future offshore and cargo operations. 5.3 Subject to options appraisal, when delivered the expanded harbour could increase capacity from one to five large berths, enable renewable energy and short-sea shipping operations, create skilled jobs, attract supply-chain investment, and significantly reduce carbon emissions from logistics. 5.4 Costings commissioned by the Council’s former Service Manager Harbours indicate that the project will require £15 million from the Just Transition Fund to complete Outline and Full Business Case (OBC/FBC) development over four years (2026-2029). This would cover development costs prior to construction including environmental impact assessment, consultations, planning and marine licensing, Crown Estate Scotland consents, detailed design, and the full suite of approvals required to progress to construction readiness. Completing this work is necessary for unlocking both public and private investment for the build phase which is anticipated to cost up to £500m. Pending any Just Transition funding, a project mandate is being prepared for Council consideration in February 2026 to seek early-stage corporate funding through the Transformation Reserve and Strategy. This Page 68
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would support early works at limited cost, so minimising any delay in progress and, should Just Transition funding be secured, allow funding from the Transformation Reserve not yet expended to be curtailed. 6. MORAY NATURAL CAPITAL ENHANCEMENT AND SKILLS PARTNERSHIP 6.1 The project will be led and delivered by Moray’s three catchment organisations - Findhorn, Nairn and Lossie Rivers Trust, the Spey Catchment Initiative and the Deveron, Bogie and Isla Rivers Trust. These organisations have full regional coverage, trusted relationships with landowners and communities, and extensive experience delivering large-scale habitat restoration across Moray. 6.2 This project will deliver large-scale habitat restoration and nature-based solutions for climate mitigation and adaptation across Moray, building on the Council’s Natural Capital Enhancement Study (funded by the Just Transition Fund in 2022) and the Findhorn Watershed Riverwoods Pilot (funded by the Just Transition Fund from 2022-2025). The project will coordinate and implement projects in woodland, peatland, and coastal restoration, natural flood management, and nature-positive farming, alongside region- wide deer management and community engagement initiatives. This work in Moray is recognised by HIE as a regional transformational opportunity, requiring a “proactive and coordinated approach by public sector actors” to unlock investment and to coordinate work in a manner where social, community and environmental benefits can be maximised for local landowners and communities. 6.3 A central benefit of this work to the Council is the creation of cost-effective, locally governed carbon sequestration projects, helping meet climate obligations transparently and in line with the Climate Change Strategy. Restoring woodland, peatland, saltmarsh, and seagrass will provide long-term carbon storage while enhancing biodiversity, reducing flood risk, improving water security, and supporting local skills and community wealth. The project will also help to improve and expand outdoor and countryside access across Moray and will provide an integrated land use forum to strengthen collaboration between land managers, communities and public agencies. 6.4 The project addresses escalating environmental pressures that threaten climate action in Scotland. Record low river flows and water scarcity in 2025 disrupted Moray’s distilleries, agriculture, and communities, while the 2025 Dava wildfire highlighted the vulnerability of nature deficient landscapes. High deer densities continue to suppress woodland and peatland regeneration, undermining national climate and biodiversity targets. Collaborative deer management and habitat restoration are therefore essential to improve ecological resilience, protect communities, and support regional economic opportunities. 6.5 The project will create green jobs and training in ecological surveying, peatland and woodland restoration, coastal habitat work, and nature-based enterprise development. By prioritising local contractors and investing in skills, the project will build community wealth while enhancing natural capital. This approach supports a just, inclusive transition to net zero and positions Moray as a national exemplar in ecosystem restoration and ethical green growth. 6.6 The project will seek £6.6 million, comprising £1.8 million in capital expenditure and £4.8 million in revenue expenditure. These cost estimates are based on the existing project Page 69
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expenditures of the partner organisations and highlight the critical importance of revenue funding in unlocking opportunities and driving progress towards achieving just transition outcomes. 7. BUILDINGS FOR THE FUTURE 7.1 This project will be a transformational Council-led programme to accelerate the delivery of affordable, low-carbon homes by redeveloping vacant and derelict land, unlocking long- stalled brownfield sites, and upgrading or redeveloping properties, including some of the poorest-performing Council properties. Buildings for the Future also aims to strengthen Moray’s construction and timber supply chains by championing local materials, supporting the use of Moray-grown timber, and creating opportunities for small and medium-sized housebuilders. Working with BE-ST (an innovation centre supported by the Scottish Funding Council) and UHI Moray, the project will create a dedicated learning environment for sustainable construction, enabling new training pathways, apprenticeships and industry upskilling. This will support a just transition for workers moving from oil and gas into high-quality green construction careers and help ensure Moray has the skilled workforce needed for its future housing ambitions. 7.2 Moray faces a substantial housing shortfall, with demand far exceeding the supply of affordable, energy efficient homes. Many brownfield sites have been recorded undeveloped for over a decade and remain financially unviable due to contamination, complex ground conditions or structural constraints. This project directly addresses those challenges by de-risking key sites, bringing forward residential development, and supporting sustainable construction in town centres and local communities. 7.3 The project would deliver new net-zero homes using modern methods of construction and will retrofit or redevelop vacant/empty properties and inefficient Council properties to reduce carbon emissions, improve warmth and comfort, and help tackle fuel poverty and support regeneration. Targeted investment will support Moray’s LHEES, enabling fabric- first upgrades and zero-emission heating for households most in need. By revitalising vacant and derelict sites and empty properties in towns including Forres, Elgin and Buckie, the project will support town centre regeneration, make more efficient use of land, and reduce pressure for development on greenfield sites. 7.4 The project aligns with national and regional priorities including National Planning Framework 4 (NPF4), the Housing Emergency Action Plan, Housing to 2040, the Moray Growth Deal and the Council’s Climate Change Strategy. It will deliver significant carbon savings through fabric-first energy upgrades, innovative net zero construction methods, and the reuse of previously developed land. By reducing fuel poverty, supporting vulnerable households, and improving the quality and accessibility of homes, the programme will contribute directly to wider national wellbeing, child poverty reduction and public health outcomes. 7.5 The project will seek approximately £32 million of capital and revenue investment. This includes redevelopment of four vacant and derelict sites, delivery of 150 new net-zero affordable homes, retrofit of 80 existing homes, and refurbishment or redevelopment of key Council assets. Further investment from Scottish Government’s More Homes Division and private and RSL partners is intended to complement the Just Transition Fund contribution. Without this funding, the most constrained regeneration sites will remain Page 70
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undeveloped, fuel poverty will persist, and Moray’s housing shortage will continue to worsen. 8. MORAY COMMUNITY SOLAR PROJECT 8.1 8.2 The project will be led by Community Energy Moray, with technical, legal and financial support from Energy4All. Energy4All is a UK non-profit organisation that develops, funds, and operates community renewable energy projects. It raises capital by issuing community share offers, enabling local people and ethical investors to take ownership stakes in renewable projects. It provides the legal, financial, and governance expertise needed to establish viable community-owned energy enterprises. The project aims to develop a community-owned solar array near Burghead, providing affordable, renewable electricity for approximately 200-400 local homes over a lifespan of around 40 years. It will also serve as a pilot for a ‘virtual microgrid’ model - one of the first projects of its kind at scale in Scotland. Electricity would be supplied through SSEN’s existing network and metered using microgrid technology. This technology reduces traditional microgrid or ‘private wire’ infrastructure costs which are otherwise passed on to the consumer, and enables projects to benefit a wider demographic. The proposal stems directly from a priority identified in the Burghead Local Place Plan, reflecting strong local demand for community-led renewable energy and action to reduce fuel poverty. The project would simultaneously consider and consult with other communities in Moray with the objective of replicating the project across suitable locations, demonstrating replicability on a national scale. 8.3 A key strength of the project is that the requested funding would unlock access to significant community-owned capital investment through Energy4All. By partnering with Energy4All, this project can leverage substantial capital funding once development and feasibility stages are complete, ensuring that the site can progress from concept to construction without requiring further taxpayer subsidy. 8.4 The project will seek £600k over a three-year period to build development and community engagement capacity and to undertake technical and feasibility studies, with an indicative split of £300k revenue and £300k capital. 9. GREEN ENERGY AND EMPLOYMENT PARKS 9.1 This project would be led by a dedicated project manager at the Council and delivered in partnership with Crown Estate Scotland (as landowner) and HIE. The project stems from earlier engagement and strategic planning by Crown Estate Scotland and the Council on the Mosstodloch Masterplan. 9.2 The project aims to unlock up to 115ha of constrained land across sites at Dallachy and Mosstodloch for renewable energy and low-carbon development by funding up front infrastructure costs. Dallachy, a former airfield, is suited to large-scale renewable projects such as anaerobic digestion, battery storage, and hydrogen, while Mosstodloch is positioned as an integrated industrial and energy hub, supporting decarbonisation of existing manufacturing and public sector facilities. Co-locating these sites will enable innovation, investment, and supply chain growth, creating a planned, infrastructure-first approach to green energy development. The project directly supports Scotland’s net zero Page 71
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targets, energy resilience, and local economic growth. It addresses key barriers to development, including grid constraints, infrastructure costs, and underused brownfield sites. 9.3 It is intended that the project will create approximately 200 jobs during construction and 45 full-time positions for operations and maintenance, with 80% expected to be filled by local people. It will provide high-value skills development in green energy industries, supporting economic diversification, addressing poverty, inequality, and demographic imbalance in Moray. The project will also generate significant renewable energy, reduce greenhouse gas emissions, and support decarbonisation of industry and public assets. 9.4 The project will bid for multi-year funding of approximately £25m in capital and revenue funding to cover upfront first phase infrastructure barriers, essential grid and site connections and project management costs. At the time of writing, costing work for this project remains ongoing alongside exploration of hybrid funding and private investment options. 10. MORAY HYDROGEN TRANSPORT PROJECT 10.1 This project will be delivered in partnership with the TH2ISTLE consortium coordinated by Aberdeen City Council, bp, ETZ Ltd, Hydrasun, the Net Zero Technology Centre and Scottish Enterprise, and supported by the Council and local industry stakeholders. 10.2 The project will expand North East Scotland’s TH2ISTLE Hydrogen Valley into Moray, creating a coordinated pathway for decarbonising the Council’s fleet and wider heavy transport across the region. The TH2ISTLE Hydrogen Valley project aims to connect green hydrogen production, storage, and end-use across Aberdeen City and Aberdeenshire. The project has successfully made it through the EU Clean Hydrogen Partnership’s technical assessment process (one of only two out of 18 projects submitted from across Europe) and is now into the grant preparation stage, with grant funding likely to be formalised by the end of 2025. By linking Moray directly into this existing project in Aberdeen City and Aberdeenshire, the project offers a ready-made platform for the Council to transition high- mileage, hard-to-electrify vehicles away from diesel. Working in partnership with ETZ Ltd and the TH2ISTLE consortium will ensure that Moray can benefit from procurement scale, technical expertise and proven delivery pathways already being used elsewhere in the region. The project will deliver access to green hydrogen, refuelling infrastructure and the operational expertise needed to convert Council fleet vehicles to low-carbon alternatives. This approach aligns closely with the Moray Hydrogen Strategy, the NE Scotland Hydrogen Valley, and the Scottish Government Hydrogen Action Plan. 10.3 A dedicated strategic plan produced in the first year will map the most effective route to transitioning the Council fleet, including identifying priority vehicle groups, suitable hydrogen models, refuelling hub locations and operational requirements such as driver training, maintenance and fleet scheduling. The strategic plan will also identify local businesses which wish to transition part of their fleet and private refuelling opportunities so an integrated Moray wide plan is created which can be delivered alongside the TH2ISTLE Hydrogen Valley project. Over the five-year project period, the Council would be able to trial hydrogen vehicles and phase in replacement vehicles as part of regular fleet replacement cycles, resulting in long-term cost efficiencies, and significantly reduced emissions from Council operations. By demonstrating leadership in hydrogen transport, Page 72
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the Council and private sector partners can also help to stimulate wider market uptake among local haulage operators, public transport providers and private businesses. 10.4 Development for this project is less advanced than others at the time of writing, owing to dependence on external funding announcements for the TH2ISTLE project. However, it is estimated that a funding request of approximately £1 million will be made, covering revenue for strategic planning and capital investment for hydrogen vehicles, refuelling facilities and operational support. 11. NEXT STEPS 11.1 Following approval of the shortlisted projects, Officers will continue to work closely with stakeholders to develop the business cases and KPIs for projects to form a cohesive regional bid to the Just Transition Fund. This collaborative, partnership-based approach is strongly encouraged and was recommended as the most effective way forward by the University of Aberdeen’s Just Transition Lab. It will not prevent other organisations from submitting their own bids, though it is suggested that the shortlisted projects represent the key strategic areas of work required to deliver a Just Transition for Moray. At the time of writing, no information has been provided regarding the structure of the fund or any indication of when applications for 2026/27 will open. Officers will maintain ongoing engagement with the Scottish Government to seek clarity on these matters. 11.2 Due to the upcoming 2026 Scottish Parliament elections, there is a possibility that opening of the funding window may occur earlier or later than in previous years. Given this uncertainty, if formal reporting cannot be achieved in relevant timescales, it is recommended that the draft bid be submitted to Senior Leadership Forum (SLF) as a sounding board for consideration of the final bid composition when prepared and that delegated authority be granted to the Executive Director Economy, Enterprise and Operations following a sounding by the SLF, to ensure that a bid can be submitted promptly when the opportunity arises. 11.3 Officers will report back to Council at the earliest opportunity once further substantive updates are available. Following the initial MP/MSP roundtable, there was significant appetite to sustain engagement, and it is therefore proposed that the Council Leader and Officers continue to engage with parliamentarians on the progress of this work. This engagement should continue as required to ensure that the needs of Moray, in respect of a just transition, are duly recognised in the funding ultimately awarded. In parallel, it is recommended that Officers engage with the JCC to raise awareness of the ongoing work to develop a just transition bid for Moray. 12. SUMMARY OF IMPLICATIONS The table below shows whether risks and implications apply if the recommendations are agreed: SUBJECT YES NO Corporate Plan and 10 Year Plan (Local Outcome Improvement Plan) X Policy and Legal X Financial X Page 73
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Risk X Staffing X Best Value and Transformation X Property X Information Communications Technology/Digital X Equalities. Social Inclusion and Economic Impact X Climate Change and Biodiversity Impact X 12.1 Corporate Plan and 10 Year Plan (Local Outcomes Improvement Plan (LOIP)) Improved Collaborative Leadership, as part of continuous improvement through Best Value, will better enable the Council to fulfil the ambitions set out in its strategic plans. a ) Links to Council Corporate Plan – The proposals in this report support and contribute to improved outcomes for communities as outlined in the following Council Plan strategic priorities: ☒ Tackle Poverty and Inequality. ☒ Build Stronger Greener Vibrant Economy. ☒ Build Thriving, resilient, empowered Communities. b ) Links to Local Outcomes Improvement Plan – The proposals in this report support and contribute to improved outcomes for communities as outlined in the following Local Outcomes Improvement Plan priorities: ☒ Developing a diverse, inclusive, and sustainable economy ☒ Building a better future for our children and young people in Moray. ☒ Empowering and connecting communities. ☒ Improving wellbeing of our population 12.2 Policy and Legal Promoting a Just Transition for Moray will allow the Council to progress climate change projects in Moray. The Climate Change (Scotland) Act 2009 places a duty on public bodies to act in the way best calculated to contribute to the delivery of Scotland’s climate change targets; in the way best calculated to help deliver any programme for climate change adaptation laid before the Scottish Parliament; in a way it considers most sustainable. 12.3 Financial There will be financial implications for the Council if the bid progresses beyond the expression of interest stage and further detailed development work such as economic impact assessments and design work is/may be required to meet government assurance processes and due diligence requirements. When the draft Climate Change Strategy was approved for consultation in September 2025, it was with the caveat that delivery of the strategy should not require any additional resources from the Council. If the investment case for Just Transition bids is considered to be compelling, then any additional expenditure not covered within existing budgets would be brought back to Council for approval through a separate report. It is also important to note that the Just Transition Fund is paid out in arrears and therefore could create cashflow implications which would be managed as part of Treasury Management activity. Page 74
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12.4 Risk Without agreement to submit a shortlist of projects, there is a risk that the Council and Moray may miss the opportunity to fully benefit from any funding available. 12.5 Staffing Additional resourcing was agreed by the Council on 25 February 2025 for a Grade 11 Senior Project Officer to be employed for a 2-year period to lead on project development for the Just Transition Fund. Project development to date has relied on input from Officers across Strategic Planning and Development, Transportation, Harbours and Finance, and continued cross-service support will be required as work progresses towards bid submission. Provision of dedicated PMO funding and associated support service costs would be sought from the Just Transition Fund as part of any funding bid to ensure that projects can be managed and progressed. There is an urgent need for project management support for the Buckie Harbour project, and this is being immediately sought via the Transformation Reserve and Strategy; additional resources will be required for business case development subject to consideration through this process. 12.6 Best Value and Transformation Contributing to the achievement of sustainable development through continuous improvement in performance is a key component of the Council’s Best Value duties set out by the Local Government in Scotland Act 2003. Achieving sustainable development means meeting the needs of the present without compromising the ability of future generations to meet their own needs. The Scottish Government’s Just Transition Fund provides an opportunity to progress sustainable development projects. 12.7 Property There are no implications directly arising from this report. Section 8 discusses the opportunities associated with attracting additional funding for Council properties, and the potential outcomes from not doing so. 12.8 Information Communications/Technology/Digital There are no implications arising from this report. 12.9 Equalities, Social Inclusion and Economic Impact A full equalities, social inclusion and economic impact assessment will be carried out to support the bid as it progresses, when further information is known regarding funding arrangements. 12.10 Climate Change and Biodiversity Impacts The Scottish Government’s Just Transition Fund will support projects which contribute towards the transition to net zero. Therefore, any project developed as recommended in this report will contribute positively to climate change and biodiversity. 13. CONSULTATION 13.1 This report has been prepared in consultation with the Chief Executive; the Executive Director - Economy, Enterprise and Operations; the Head of Growth, Planning and Climate; the Head of Operations and Environment; the Head of Housing, Property and Communities; the Chief Financial Officer; the Service Manager Strategic Planning and Page 75
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Development; the Service Manager Harbours; the Principal Planning Officer (E Webster); the Senior Planning Officer (R MacDougall); the Principal Climate Change Strategy Officer; the Community Wealth Building Officer; the Service Manager Legal Services, and the Service Manager Democratic Services. External project leads have also been consulted on this report. 14. BACKGROUND PAPERS Just Transition Fund Update – Moray Council - 27 August 2025 Page 76
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Report to: Moray Council Meeting Date: 28 January 2026 Report by: Executive Director Education, Housing and Communities Author: Andrew Hall/Jennie Ordonez Contact Email: learningestate@moray.gov.uk Subject: Elgin High School Expansion Project Update 1. PURPOSE 1.1 The purpose of this report is for Council to consider and note the outcome of the external reviews of the school roll forecast methodology and teaching spaces utilisation and consider the impact on the current Elgin High School extension project. 1.2 This report is submitted to Council in terms of Section III (D) (17) of the Council’s Scheme of Administration relating to the School Estate to consider and make recommendations on capital and minor works programmes within the remit of the Council. 2. SUMMARY 2.1 This report provides an update on the Elgin High School extension project following external reviews to assess the school roll forecast methodology and teaching spaces optimisation options and outlines detailed recommendations on next steps to consider for the project. 2.2 This report was originally submitted to Education, Children’s and Leisure Services Committee on 25 November 2025 (para 18 of the draft minute refers) where a decision on the recommendations was deferred to facilitate an information session and tour of Elgin High School for Councillors, Elgin High School Associated School Group (ASG) Parent Councils, non-voting Education, Children’s and Leisure Services Committee members and Elgin Community Council members, which took place on 16 January 2026. 3. RECOMMENDATIONS 3.1 It is recommended that Council: ☒ For Decision ☐ For Information Item 9. Page 77
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i) Consider and note the outcome of the external review of the school roll forecast methodology and the current use of space within the existing school buildings; ii) Consider future options and agree to proceed with Option 4: Progress the Elgin High School project through alternative solutions in the existing building rather than a physical new build extension to manage future capacity requirements; and, iii) Agree to the continued use of the external consultancy design team procured by hub North Scotland Limited (hNSL) for the internal design works to increase teaching space capacity within the main school building. Andrew Hall/Jennie Ordonez Service Manager Education Estate/Senior Project Officer (Education Estate) 4. BACKGROUND AND CONTEXT 4.1 Following the Education, Children’s and Leisure Services Committee meeting on 25 November 2025, it was agreed (para 18 of the draft minute refers) to defer decisions on the recommendations for the Elgin High School extension project within the report to this Council meeting on 28 January 2026. This was to allow for a visit to be organised for interested Councillors, Elgin High School Associated School Group (ASG) Parent Council members, non-voting Education, Children’s and Leisure Services Committee members and Elgin Community Council members to visualise the future project option recommended in this report. This visit was facilitated on 16 January 2026 and was attended by 25 individuals. 4.2 Given the indicative reduction in the school roll forecast capacity requirements for Elgin High School, it was agreed at the Education, Children’s and Leisure Services Committee on 26 November 2024 (para 26 of the minute refers) to approve an up to 12-month project delay before the commencement of hub Stage 2 (detailed design phase) while the accuracy of the existing school roll forecast information and the data used to generate it was fully reviewed and assessed. 4.3 It was also reported to the Education, Children’s and Leisure Services Committee on 26 November 2024 that the Planning & Regulatory Services Committee on 15 August 2023 had approved (para 14 of the minute refers) the appointment of external consultants to conduct a review of the education methodology to forecast future school rolls across Moray. The external review was commissioned with the aim of determining whether the current methodologies and assumptions used to inform future requirements for the learning estate, as well as the associated developer obligations, were both credible and robust. A key focus of the review was to identify any weaknesses within these methods and assumptions, and to recommend appropriate revisions to strengthen the overall approach. Additionally, the review undertook an independent assessment of the school roll forecast information that - up until the analysis of the September 2024 school census - had supported the need for an expansion of Elgin High School’s capacity through a new build extension project. Aberdeenshire Council were appointed to undertake this review and analysis, with the full report available as a confidential background paper. The report provides assurances that the existing school roll forecast data, which will contribute to any Page 78
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future decision for the project, is robust and the methodology used by Moray Council to determine school roll forecasts is appropriate and relevant. 4.4 While the Aberdeenshire Council report does not specifically provide a recommendation on whether an extension should be built, it does highlight that the latest school roll forecasts do not support the requirement for a significant extension to Elgin High School citing a national reduction in primary aged population, which in time will filter into secondary school rolls. 4.5 In addition to the school roll forecast methodology review and assessment, further consultancy support was procured to provide a detailed review of the current time-tabling approach and space utilisation within the existing school buildings to ascertain future space efficiency opportunities within the current design or support design improvements. This work was carried out by Building Spatial Intelligence (BSI). 4.6 This report outlines models for three pupil scenarios – 842 current pupils (based on pupil numbers in March 2025), forecasted pupil numbers of 900 pupils and a maximum number of 1150 pupils equating to the existing project capacity expansion design requirement. 4.7 The BSI analysis was based on data from the current timetable, class sizes, pupil numbers, and other relevant details to ensure the report accurately reflected the school’s operations. Additionally, analysis was based on floor plans and a room schedule detailing each space, its current usage and area. 4.8 The BSI report provides a detailed review of space utilisation, workplace utilisation, and overall teaching capacity, along with recommendations for optimising the use of existing spaces and addressing any deficits. Where utilisation figures are noted, this refers to a Utilisation Factor, which represents the proportion of time a room is timetabled for use; for example, a room used for seven periods of an eight-period day has a Utilisation Factor of 87.5%. 4.9 Key findings of the report related to the utilisation of the school are that: • The overall school area and existing teaching space allocation is large enough, compared with the General Requirements and Standards (1967), for the current pupil numbers (842) but slightly undersized for the pupil projections (900). Compared with these guidelines, the school would be significantly undersized for 1150 pupils. • Average class sizes indicate many subjects are held in classrooms that can accommodate higher pupil numbers. This is particularly true for senior phase classes with an average group size of 8 pupils being held in rooms that can accommodate 30-33 pupils. This means that smaller rooms could be considered depending on the individual subject taught. • The overall average utilisation of the school is currently 56.9%, which is comparatively low. Table 1 highlights the variance in utilisation based on subject areas for the current pupil numbers (842). Table 2 demonstrations that the utilisation would increase to 61% for the forecast pupil numbers (900), and Table 3 highlights that the utilisation would increase to 74% for the future maximum (1150) Page 79
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although this would not be manageable within the current design of the school and would require additional teaching spaces to accommodate the increased numbers of 900 and 1150. Table 1: Teaching Space Utilisation by subject (842 pupil roll) Room Type Rooms Periods Available Periods Utilisation Rooms Required Surplus/ Deficit General Classroom 22 726 633 87% 22 0 Art 3 99 60 61% 3 0 ICT 4 132 43 33% 2 2 Science 8 264 174 66% 7 1 Music 3 99 53 54% 2 1 Drama 2 66 34 52% 2 0 Technology Workshop 2 66 36 55% 2 0 Technology Studio 2 66 52 79% 2 0 Textiles 1 33 0 0% 0 1 Food 2 66 54 82% 2 0 Total 49 1617 1139 56.9% 44 5 Table 2: Teaching Space Utilisation by subject (900 pupil roll) Room Type Rooms Periods Available Periods Utilisation Rooms Required Surplus/ Deficit General Classroom 22 726 680 94% 23 -1 Art 3 99 66 67% 3 0 ICT 4 132 49 37% 2 2 Science 8 264 182 69% 7 1 Music 3 99 58 59% 3 0 Drama 2 66 34 52% 2 0 Technology Workshop 2 66 36 55% 2 0 Technology Studio 2 66 63 95% 3 -1 Textiles 1 33 0 0% 0 1 Food 2 66 54 82% 2 0 Total 49 1617 1222 61% 47 2 Table 3: Teaching Space Utilisation by subject (1150 pupil roll) Room Type Rooms Periods Available Periods Utilisation Rooms Required Surplus/ Deficit Page 80
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General Classroom 22 726 793 109% 27 -5 Art 3 99 85 86% 4 -1 ICT 4 132 56 42% 2 2 Science 8 264 213 81% 8 0 Music 3 99 67 68% 3 0 Drama 2 66 43 65% 2 0 Technology Workshop 2 66 46 70% 2 0 Technology Studio 2 66 76 115% 3 -1 Textiles 1 33 0 0% 0 1 Food 2 66 66 100% 3 -1 Total 49 1617 1445 74% 54 -5 5. PROPOSALS 5.1 As part of the report submitted to the Education, Children’s and Leisure Services Committee on 26 November 2024, it was advised that a number of early alternative options to a full new build extension had been identified. These options, noted within a Background Paper to the 26 November 2024 report, included the following: • Option 1 – No change to the original extension plans • Option 2 – Reduce the capacity of the new build extension to support a reduced planning capacity of 1050 or lower • Option 3 – Defer new build extension project (with anticipated reduction in size and cost) • Option 4 – Progress the Elgin High School project through alternative solutions in the existing building rather than a physical new build extension to manage future capacity requirements. • Option 5 – Rezone Elgin High School and Elgin Academy 5.2 These five options are outlined in more detail within the completed options appraisal matrix at Appendix 1 which highlights the varying levels of cost, flexibility, and long-term resilience of each option. 5.3 This appraisal ranks the options based on six key criteria and includes a summary of key findings for each option, taking into consideration the information from the external consultancy review reports and the current school roll forecasting projections. 5.4 Application of the existing school roll forecast methodology to the September 2025 census data indicates a further reduction in the school roll over the next 8 years with the maximum roll of 853 forecast for 2033, a reduction of 28 from the 2024 school roll forecast for 2032. This is significantly less than the 934 roll that was forecast for academic year 2028/29 in January 2021 which was a key driver in supporting the previous recommendation for a significant capacity expansion requirement facilitated by a new build extension. A Page 81
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comparison of 2024 and 2025 school roll forecasts together with the impact of increasing the capacity is detailed at Appendix 2. 5.5 Despite a further reduction in the school roll forecast compared with previous years, the most recent school census data still indicates that the Elgin High School roll forecast will remain above the existing school building planning capacity by 2028 thus indicating that some level of increased capacity would be required. 5.6 When taking this into consideration along with the options appraisal, the external school roll forecast review, the current school roll forecast data and the external timetabling and space optimisation review, Option 4 is considered as the most appropriate and cost- effective solution: Option 4: Progress the Elgin High School project through alternative solutions in the existing building rather than a physical new build extension to manage future capacity requirements. • While this option would result in the loss of LEIP 2 funding (up to £8.3m) towards the Elgin High School project, it does offers substantial cost savings compared to more extensive expansion options. • Relatively straightforward to implement, reducing potential disruption and speeding up delivery times. • Minimises immediate budgetary impact, preserving funds for other Learning Estate programme priorities. • Provides a practical solution for current needs, without overcommitting resources based on uncertain future projections. • Despite the potential of losing developer obligations, this option aligns most closely with the council's current financial realities, reduces risk and provides a logical pathway for delivering the project’s objectives within available resources. 5.7 The assumption is that regardless of the Council decision as to which Option to pursue, work should go ahead to determine opportunities to repurpose spaces within the current high school building to increase the planning capacity from the existing 829 to a target minimum of 950. This will include consideration of current and future Additional Support Needs (ASN) provision within Elgin High School, taking into account the specific space and resource requirements associated with supporting these learners, so that any refurbishment plans address not only overall capacity within the school but also optimise the existing general purpose teaching spaces currently being used for extended ASN accommodation to meet ASN needs in line with best practice and statutory obligations. With Elgin Academy taking back ownership of the enhanced provision space within the school from central ASN services, this further alleviates the pressure on ASN space within Elgin High School where children in Elgin North with a high level of need would transition to Elgin Academy. 5.8 It is recommended that, given their detailed understanding of the current school building, Moray Council continue to use the existing external consultancy design team through hNSL for the internal design works to support delivery of an increased capacity within the existing school building in order to optimise space. 6. SUMMARY OF IMPLICATIONS Page 82
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6.1 The table below shows whether risks and implications apply if the recommendations are agreed: SUBJECT YES NO Corporate Plan and 10 Year Plan (Local Outcome Improvement Plan) ✓ Policy and Legal ✓ Financial ✓ Risk ✓ Staffing ✓ Best Value and Transformation ✓ Property ✓ Information Communications Technology/Digital ✓ Equalities. Social Inclusion and Economic Impact ✓ Climate Change and Biodiversity Impact ✓ 6.2 Corporate Plan and 10 Year Plan (Local Outcomes Improvement Plan (LOIP)) Improved Collaborative Leadership, as part of continuous improvement through Best Value, will better enable the Council to fulfil the ambitions set out in its strategic plans. a) Links to Council Corporate Plan – The proposals in this report support and contribute to improved outcomes for communities as outlined in the following Council Plan strategic priorities: ☒ Tackle Poverty and Inequality. ☐ Build Stronger Greener Vibrant Economy. ☒ Build Thriving, Resilient, Empowered Communities. b) Links to Local Outcomes Improvement Plan – The proposals in this report support and contribute to improved outcomes for communities as outlined in the following Local Outcomes Improvement Plan priorities: ☐ Developing a diverse, inclusive, and sustainable economy. ☒ Building a better future for our children and young people in Moray. ☐ Empowering and connecting communities. ☐ Improving wellbeing of our population. 6.3 Policy and Legal There are no policy or legal implications arising directly from this report; however, any option that involves new build construction or refurbishment of existing spaces would require resources to manage the legal aspects associated with changes to the existing Design, Build, Finance and Maintain (DBFM) contract. 6.4 Financial The 2023-24 indicative 10-year Capital Plan had £14.7m allocated to fund an extension to Elgin High School. Moray Council approved an increased capital cost of £19.3m in September 2023 (para 19 of the minute refers). The most recent estimated project costs from the hub North Scotland stage 1 pricing report indicated a higher forecasted figure of £20.284m (including authority costs) which is an increase of £1.464m on the £18.82m estimated costs reported to the Education, Children’s and Leisure Services Committee in November 2024. This does not take into account the impact of inflation due to a 12- Page 83
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month project delay which could increase costs by a further estimated 4% if the full extension were to proceed as originally planned. As part of the value engineering exercises undertaken during hub stage 1, several areas have been identified that would bring costs back in line within the approved £19.3m budget. If the project were to proceed with Option 1 or Option 2, it would still be eligible to receive Learning Estate Investment Programme (LEIP) 2 funding despite the programme delays. The other proposed options would see the loss of LEIP 2 funding for this project (up to £8.3m). A case could be made to Scottish Government to transfer this LEIP 2 funding to another project (this project itself was a replacement for the Findrassie Primary School project) such as a standalone specific building refurbishment project at Buckie High School, which could help support some of the phased project work required. Any other project seeking LEIP 2 funding would be expected to meet the current LEIP 2 deadlines (currently end of 2026) and other project metrics; however, further discussion would be required with Scottish Government to confirm viability of transferring funds, funding amounts and timescales for any alternate project. The LEIP funding is offered under an outcome-based revenue model, with revenue payments made by the Scottish Government over the 25-year life of the proposed facility. Funding is to be released on a phased basis based on achievement of agreed outcomes. The project spend to date from financial years 2023-24, 2024-25 and 2025-26 has been £583k. The below table outlines the estimated cost associated with each option presented in the proposal section and options appraisal in Appendix 1. Option Estimated Capital Cost Option 1 – No change to the original extension plans £19.3m in current capital budget plans Option 2 - Reduce the capacity of the new build extension to support a reduced planning capacity of 1050 or lower £7.3m-£10.7m depending on level of scope reduction Option 3 - Defer new build extension project (with anticipated reduction in size and cost) no immediate capital spend beyond already incurred hub stage 1 design fees and local authority costs through end of 25/26 financial year £598k – would require some level of capital investment to manage capacity requirements by 2028 Option 4 - Progress the Elgin High School project through alternative solutions in the existing building rather than a physical new build extension to manage future capacity requirements estimated £1m cost for internal re- purposing work plus £598k spent for hub stage 1 through end of 25/26 financial year Option 5 - Rezone Elgin High School and Elgin Academy no associated capital costs to rezone apart from capital funds spent to Page 84
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complete hub stage 1 through end of 25/26 financial year – £598k If Option 3, 4 or 5 were progressed, this will impact on developer obligations which have Section 75 agreements in place for contributions towards an extension for Elgin High School. Currently, £281,198.53 has been paid by developers to go towards the Elgin High School extension, with a further £1,957,945.82 outstanding once payment terms have been triggered. 6.5 Risk The following risks have been identified and should be noted: Funding Risk i. For any LEIP funded project, the Council carry the full risk of capital funding with revenue budget support only provided once the school is operational and at different stages in the building lifecycle, dependent on the achievement of defined performance outcomes. This would apply if Option 1 or Option 2 were chosen. ii. Likewise with Option 1 or Option 2, there is risk that the area metric proposed by the Scottish Government to value a LEIP 2 project will not correspond to the actual market rate experienced at the time of construction. The consequence is that the maximum 50% of qualifying project value provided by the Scottish Government could be significantly less than that (with the Council therefore bearing a significantly higher proportion of the overall costs of the project). iii. Loss of LEIP Phase 2 (up to £8.3m) funding from Scottish Government if Option 3, 4 or 5 is selected as the way forward for this project. iv. The maximum developer obligation payments to support an increase in secondary school capacity are currently associated with the delivery of a new build extension. Should an alternative future mitigation option be pursued, the currently received developer obligations would have to be returned with no further collection of future obligations towards a new build extension under the existing section 75 legal agreements. Capacity Risk i. There is a risk that the school roll forecast is higher than predicted which could have an impact on operation of the school if the full extension or reduced scope extension is not constructed. Any increases in the school roll forecast would be mitigated by the significant lead time provided by future school roll data, allowing the Council sufficient opportunity to plan and implement appropriate measures should this risk materialise. ii. Alternatively, if the full or reduced scope extension were progressed and the school roll forecast was lower than predicted, this could result in monies spent which could have been reprofiled to other projects within the Learning Estate. This consideration is a key factor in recommending Option 4, as it would help mitigate Page 85
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the risk of investing funds in excess school capacity that might otherwise have been redirected elsewhere. 6.6 Staffing There are no immediate staffing implications arising directly from this report; however, there would be resources required to support a refurbishment project should the decision be taken not to progress with a new build extension at this time and Option 4 were chosen. This would be managed within current resources of the Education Estate Team based on existing commitments. Any future increase in school roll will likely result in an increase in teaching and support staff. This will be assessed and reported as per current school staffing processes and procedures. Additionally, there is potential for increased workload for the Strategic Planning and Development team and legal services arising from modifications to existing section 75 agreements and administration of returning received funds which would be managed within existing resources. 6.7 Best Value and Transformation There are no best value or transformation implications arising directly from this report. 6.8 Property The property implications are set out in the body of the report. 6.9 Information Communications/Technology/Digital There are no information communications/technology/digital impacts arising directly from this report. However, it is important to note that if the full or reduced scope project were cancelled, any refurbishment plans of the existing school may require improved connectivity within the school, and staff would need appropriate resources to ensure capability to operate throughout the building efficiently when moving between classrooms. 6.10 Equalities, Social Inclusion and Economic Impact The quality of the learning environment can impact on learning and attainment by as much as 16%. The condition and suitability of our learning estate, and capacity challenges associated with both growth and population decline in some areas, give rise to unequal opportunity across Moray. This proposal supports the Learning Estate Strategy requirement that all Learning Estate buildings meet minimum standards and are fit for purpose. Investment in a major infrastructure project provides opportunity for social and economic impact. 6.11 Climate Change and Biodiversity Impacts There are no climate change and biodiversity impacts arising directly from this report. It is important to note however that any new build construction option will have a climate change impact with embodied carbon impacts during construction and whole life operational carbon. The scale of this overall impact for the new build options would be Page 86
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assessed in detail as the project progresses to Full Business Case and would be balanced against the current operational carbon budgets if Option 1 or 2 were selected. While reusing the existing building would result in considerably less carbon emissions than constructing a new extension, any major refurbishment works related to Option 4 would still need to take carbon impacts into consideration. 7. CONSULTATION 7.1 This report has been prepared in consultation with the Chief Governance Officer, Chief Financial Officer, Head of Education (Chief Education Officer), Head of Housing, Property and Communities; Head of Growth, Planning and Climate; Head of HR and Organisational Development; Service Manager Strategic Planning & Development; Principal Planning Officer (Strategic Planning and Development); Service Manager Strategic Finance; Service Manager Property, Estates and Assets; Service Manager Legal Services; Service Manager Democratic Services, Strategy and Performance Manager; Head Teacher Elgin High School and any comments have been incorporated into the report. 8. BACKGROUND PAPERS 8.1 ECLS 20241126 Elgin High School Expansion Project Update 8.2 ECLS 20241126 Elgin High School Expansion Project Update Background Paper 8.3 MC 20260128 Elgin High School Expansion Project Update Confidential Background Paper Page 87
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APPENDIX 1 Elgin High School Extension Project Options Appraisal The table below outlines the advantages and disadvantages for each option and the associated cost implications: Option Advantages Disadvantages Cost Implication Option 1 – no change to original extension plans • ensures maximum capacity is delivered to meet long-term demand • supports flexibility and infrastructure needs across the secondary school estate • would be delivered with the support of Scottish Government LEIP 2 funding (up to £8.3m) • allows existing space within current building to be re-purposed for space optimisation • provides additional community use space for out of school hours • would still meet requirements for developer obligations • high capital cost of up to £19.3m over the next 3 financial years impacting on potential reallocation of funds elsewhere within the Learning Estate, particularly for the future Buckie High School and BB upgrade projects • full commitment to investment despite potential alternatives that offer similar capacity benefits for less £19.3m in current capital budget plans Option 2 – Reduce the capacity of the new build extension to support a reduced planning • cost savings of up to £8.6m-£12m depending on final capacity • still provides a comfortable surplus through to 2033 and ensures forecast school roll would not exceed 90% planning capacity based on current predictions if planning capacity maintained at 950 or above (see Appendix 2) • requires a partial capital investment of up to £10.7m over the next 3 financial years impacting on potential reallocation of funds elsewhere in the Learning Estate, particularly for the future Buckie High School project and BB upgrade projects • potential loss of future proofing if school roll grows beyond forecast £7.3m-£10.7m depending on level of scope reduction Page 88
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Option Advantages Disadvantages Cost Implication capacity of 1050 or lower • addresses any realistic maximum increase in housing output rate beyond the current annual forecasts over the next 10 years • retains flexibility and additional capacity for infrastructure support across the entire secondary school estate over the next few years • would still qualify for Scottish Government LEIP 2 funding at a maximum 50% of the agreed project costs (amount would require to be confirmed with Scottish Government) • allows existing space within current building to be re-purposed for space optimisation • provides additional community use space for out of school hours • would still meet requirements for developer obligations • design could be developed to better support a future extension of new build should capacity exceed 1050 (or lower) threshold in the future • delay in implementation due to design adjustment and review period Option 3 – Defer new build extension project (with anticipated • no immediate capital spend beyond hub stage 1 design fees and local authority costs through end of 25/26 financial year – £598k • can re-engage project quickly with no design work lost • annual review allows flexibility in response to changing school rolls • project costs are likely to increase due to inflation when the project is restarted • 10-year capital plan would still need to acknowledge an allowance for the project to be completed no immediate capital spend beyond already incurred hub stage 1 design fees and local authority costs through end of 25/26 financial year – Page 89
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Option Advantages Disadvantages Cost Implication reduction in size and cost) • loss of Scottish Government LEIP 2 funding (up to £8.3m) as project would fall outside delivery window • may see the current school roll reach 100% capacity (surplus of <25 places) in the 2028- 2033 time frame therefore requiring some level of capital investment to manage capacity requirements • requires continued use of temporary modular classrooms which must be removed by March 2028 to align with existing planning and building warrant permissions • developer obligations would be lost - Section 75 agreements linked to any contributions being spent towards an extension within 15 years of final payment £598k; however, may require some level of additional spend to address capacity requirements within the 2028-2033 time frame Option 4 – Progress the Elgin High School project through alternative solutions in the existing building rather than a physical new • lowest capital spend option (estimated £1m total for internal re-purposing work and potential additional modular units plus costs associated with project in previous financial years through end of 25/26 financial year - £598k) • makes use of existing facilities and encourages space optimisation • frees up significant funds for other priorities • provides a moderate capacity buffer (up to 950 pupils) if fully implemented • loss of Scottish Government LEIP 2 income- based funding support (up to £8.3m) • relies on re-purposing space, which may impact educational or ASN provision • relies on temporary use of modular units which have time limits of planning permission and building warrants through March 2028 limiting available period for continued use • potentially less desirable long-term solution compared to a permanent build • limited scalability if enrolment grows beyond current school roll forecast estimated £1m cost for internal re- purposing work and additional modular units plus £598k spend to date for hub stage 1 through end of 25/26 financial year Page 90
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Option Advantages Disadvantages Cost Implication build extension to manage future capacity requirements • allows potential for creation of smaller spaces which takes account of the need for smaller class sizes in senior phase and supports additional assessment arrangements for examination periods • developer obligations would be lost - Section 75 agreements linked to any contributions being spent towards an extension within 15 years of final payment Option 5 – Rezone Elgin High School and Elgin Academy • no capital cost – only minor revenue spend for rezoning process • uses existing surplus places at Elgin Academy • helps balance school roll pressure across both Elgin High School and Elgin Academy • opportunity for better alignment of secondary/primary catchments with new and existing active travel and public transport routes • loss of Scottish Government LEIP 2 income-based funding support (up to £8.3m) • risk to future population growth planning in Elgin south and north • requirement for statutory consultation with associated high risk of significant parental and community resistance • extremely disruptive for existing school communities • complexity due to existing catchment boundaries which could impact on safe routes to school and present barriers to acceptable travel distances, e.g. A96 road and main Aberdeen-Inverness rail • uncertain effectiveness – dependent on future growth areas aligning with rezoned catchments • no positive impact without significant caps on future placing requests – and increase in appeals no associated capital costs to rezone apart from capital funds spent to complete hub stage 1 through end of 25/26 financial year– £598k Page 91
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Option Advantages Disadvantages Cost Implication • developer obligations would be lost – with Section 75 agreements currently supporting contributions towards an extension project The council faces a decision on how to address future secondary school capacity demands while managing capital affordability constraints. The purpose of this options appraisal is to provide a structured and objective evaluation of five potential approaches for addressing future capacity requirements at Elgin High School. Each option offers varying levels of cost, flexibility and long-term resilience and has been assessed against six key criteria—Affordability, Capacity Resilience, Funding Eligibility, Implementation Timeframe, Long-term Flexibility, and Community Acceptability—using weightings to reflect their relative importance. The following section outlines the rationale behind the selected weightings and presents a detailed appraisal matrix, followed by recommendations based on the analysis. Criteria Weight Explanation Affordability 35% Assesses the financial feasibility of each option, considering the capital investment required and the impact on the budget. This is the most heavily weighted criterion, as budget constraints and financial feasibility are critical in ensuring that the chosen option is sustainable and does not adversely impact other priorities within the Learning Estate. Capacity Resilience (to 2033) 15% This criterion evaluates the ability of each option to meet future capacity demands up to the year 2033. Ensuring sufficient capacity to meet projected demand is essential for the long-term effectiveness of any solution, though it carries less weight than affordability. Funding Eligibility 10% This criterion considers the eligibility of each option for external funding, such as Scottish Government LEIP 2 funding. Access to external funding, particularly from the Scottish Government’s LEIP 2 programme, is important but less critical than the direct capital outlay and capacity provision. Implementation Time Frame 20% This criterion assesses the time required to implement each option and the impact on project timelines. This is given substantial weight because the speed and certainty of delivery are significant, timely delivery minimises disruption Page 92
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Criteria Weight Explanation and helps keep the project on schedule. If implementation takes too long, the benefits may be delayed and may impact service provision. Long-term Flexibility 10% This criterion evaluates the flexibility of each option to adapt to future changes in enrolment and housing data which is important for ensuring ongoing suitability of the chosen approach. This is a valuable strategic advantage but less urgent than immediate financial or capacity needs. Community Acceptability 10% This criterion considers the level of acceptance and support from the community for each option. Although community support is a key factor for successful implementation and can influence overall success, it was given a lower weight as financial and operational criteria were considered more critical to the project's delivery and is therefore balanced against the overriding need for affordability and capacity. These criteria have been used to evaluate and compare the different options for the project, ensuring that the chosen option provides a balanced solution across financial, operational, and strategic aspects. Each option has been scored on a scale of 1 (least favourable) to 5 (most favourable) for each criterion. Weighted scores are calculated by multiplying the score by the criterion’s weighting. The total weighted score determines the overall ranking. Criteria Weight Option 1 – no change to original extension plans Option 2 - Reduce capacity of the new build extension Option 3 - Defer new build extension project Option 4 - Progress the Elgin High School project through alternative solutions to manage future capacity requirements Option 5 - Rezone Elgin High School and Elgin Academy Affordability 35% 1 3 4 5 5 Capacity Resilience (to 2033) 15% 5 4 3 4 2 Page 93
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Funding Eligibility 10% 5 5 1 1 1 Implementation Time Frame 20% 3 3 3 4 2 Long-term Flexibility 10% 4 3 3 3 2 Community Acceptability 10% 4 4 3 2 2 Overall Score 22 22 17 19 14 Weighted Score (out of 5) 3.0 3.45 3.15 3.75 2.95 Ranking 4 2 3 1 5 Key Findings • Option 1 (No Change) While strong for capacity resilience and funding eligibility, this option is much less affordable requiring a capital investment of up to £19.3 million, placing significant pressure on already stretched budgets and limiting flexibility in reprofiling funds across the Learning Estate. Its impact on the overall Learning Estate budget makes it less appealing under current financial challenges. • Option 2 (Reduced Capacity Extension) This option balances affordability, external funding access and capacity resilience. It offers flexibility for future growth and provides an effective surplus to meet forecast demand, maintaining eligibility for LEIP 2 funding and keeping costs more manageable than Option 1; however, it still presents financial challenges when compared with other options thereby making it a less viable solution. • Option 3 (Defer Project) Deferring the project minimises immediate capital outlay and allows adaptation to changing enrolment patterns. However, it results in the loss of LEIP 2 funding eligibility and exposes the project to potential inflationary cost increases. It remains a sensible choice if future demand is uncertain but does not score as highly as other options as while it may provide temporary relief, ultimately it would merely postpone the Council’s financial challenges rather than resolving them, shifting the burden to later years within the existing 10-year plan. • Option 4 (Progress the Elgin High School project through alternative solutions in the existing building rather than a physical new build extension) Emerging as the preferred choice based on the scoring matrix, this option provides the lowest immediate capital spend (circa £1 million). Although it limits access to external funding and only modestly increases capacity through internal repurposing, it offers substantial cost savings and immediate budgetary relief. While scalability is limited and it may not be suitable if enrolment rises sharply, it represents the most cost-effective solution in the short to medium term, freeing up significant funds for other priorities. Page 94
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• Option 5 (Rezoning) This option offers affordability but scores poorly on capacity resilience relying on redirecting pupils to a nearby school with surplus capacity. Success depends on geographic growth patterns and community acceptance, both of which are uncertain. Additionally, this option relies on significant and complex catchment changes, making it unlikely to be effective or widely accepted without major modifications. Recommendations Option 4: Progress the Elgin High School project through alternative solutions in the existing building rather than a physical new build extension is recommended as the most balanced and strategic option, offering the highest weighted score (3.75) and a balanced solution across financial, operational and strategic criteria: • Offers substantial cost savings compared to more extensive expansion options. • Relatively straightforward to implement, reducing potential disruption and speeding up delivery times. • Minimises immediate budgetary impact, preserving funds for other council priorities or unforeseen needs. • Provides a practical solution for current needs, without overcommitting resources based on uncertain future projections. • Aligns most closely with the council's current financial realities, reduces risk and provides a sensible pathway for delivering the project’s objectives within available resources. Further Considerations: Why Not Option 1? – Although Option 1 scores highly for capacity and funding eligibility, it is significantly less affordable, with a high capital cost and limited flexibility. The impact on the wider Learning Estate budget makes it less attractive given current constraints. Why Not Option 2? – Option 2, while potentially offering a compromise between capacity expansion and cost, still requires a considerable capital investment that does not deliver the same level of cost savings as Option 4. Additionally, the approach may involve a degree of disruption and complexity during implementation, with uncertain returns on investment given the current unpredictability in enrolment trends. This makes it a less attractive proposition compared to the more flexible and budget-conscious alternatives. Why Not Option 3? – Although deferring the project (Option 3) reduces immediate capital expenditure and provides flexibility to respond to future changes in demand, it comes with significant drawbacks. Most notably, the project would lose eligibility for LEIP 2 funding and be exposed to inflationary cost increases, potentially resulting in higher overall spend in the long term. Furthermore, it leaves capacity issues unresolved in the short term and does not offer the same lasting budget relief or strategic alignment as Option 4 since the 10-year capital plan would still need to acknowledge an allowance for the project to be completed. Deferring the project increases the risk of the current school roll reaching 100% capacity by 2028 which would necessitate some form of capital investment to address emerging capacity pressures during that period. Page 95
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Why Not Option 5? – While Option 5 is cost-effective, it has significant risks around public acceptability and planning misalignment, with limited capacity benefit. Rezoning would require statutory consultation and is likely to face significant parental and community opposition, making implementation challenging. Furthermore, it would be highly dependent on complex catchment changes, extremely disruptive for existing school communities and is unlikely to be effective or widely supported without major adjustments. Page 96
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APPENDIX 2 ELGIN HIGH SCHOOL – SCHOOL ROLL FORECASTS Table 1: School Roll Forecast Jan 2025 (September 2024 census data) ELGIN HIGH (S03) 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 INPUTS Pupils per household 0.15 0.15 0.15 0.15 0.15 0.15 0.15 0.15 0.15 0.15 0.15 0.15 0.15 Housing 105 73 59 81 84 49 82 63 85 80 127 102 116 Placing Requests 5 3 -2 9 -4 1 2 0 1 1 0 1 1 CLASS S1 162 167 160 164 144 148 150 173 182 144 157 152 171 S2 172 160 165 160 158 146 149 153 175 184 147 160 155 S3 126 173 160 162 161 160 148 152 155 177 187 150 163 S4 141 128 175 158 165 163 162 150 154 157 180 190 153 S5 98 108 107 149 139 136 135 134 124 127 130 149 157 S6 54 60 64 49 88 74 75 74 74 68 70 71 82 Total Roll 753 796 831 842 855 826 819 835 863 858 871 873 881 Planning Capacity 899 899 829 829 829 829 829 1150 1150 1150 1150 1150 1150 Total Roll - Total Capacity -146 -103 2 13 26 -3 -10 -315 -287 -292 -279 -277 -269 (Tot Roll/Total Capacity)% 84% 89% 100% 102% 103% 100% 99% 73% 75% 75% 76% 76% 77% ACTUAL FORECAST Page 97
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Table 2: School Roll Forecast September 2025 (September 2025 census data) – with capacity scenarios ELGIN HIGH (S03) 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 INPUTS Pupils per household 0.15 0.15 0.15 0.15 0.15 0.15 0.15 0.15 0.15 0.15 0.15 0.15 0.15 Housing 73 59 81 84 49 82 63 85 80 127 102 116 150 Placing Requests 3 -2 9 -4 -1 1 -1 0 0 -1 0 0 0 CLASS S1 167 160 164 144 141 153 164 174 140 150 150 154 173 S2 160 165 160 158 141 143 155 166 177 143 153 153 158 S3 173 160 162 161 158 143 145 157 169 180 147 156 157 S4 128 175 158 165 162 160 145 147 159 172 183 150 160 S5 108 107 149 139 133 135 133 120 122 132 142 151 123 S6 60 64 49 88 81 75 74 73 66 67 72 78 83 Total Roll 796 831 842 855 816 808 816 838 833 843 847 841 853 *Planning Capacity 899 829 829 829 829 829 1150 1150 1150 1150 1150 1150 1150 Total Roll - Total Capacity -103 2 13 26 -13 -21 -334 -312 -317 -307 -303 -309 -297 (Tot Roll/Total Capacity)% 89% 100% 102% 103% 98% 98% 71% 73% 72% 73% 74% 73% 74% *Planning Capacity 899 829 829 829 829 829 859 889 950 950 950 950 950 Total Roll - Total Capacity -103 2 13 26 -13 -21 -43 -51 -117 -107 -103 -109 -97 (Tot Roll/Total Capacity)% 89% 100% 102% 103% 98% 98% 95% 94% 88% 89% 89% 89% 90% *Planning Capacity 899 829 829 829 829 829 859 889 925 925 925 925 925 Total Roll - Total Capacity -103 2 13 26 -13 -21 -43 -51 -92 -82 -78 -84 -72 (Tot Roll/Total Capacity)% 89% 100% 102% 103% 98% 98% 95% 94% 90% 91% 92% 91% 92% *Planning Capacity 899 829 829 829 829 829 829 829 829 829 829 829 829 Total Roll - Total Capacity -103 2 13 26 -13 -21 -13 9 4 14 18 12 24 (Tot Roll/Total Capacity)% 89% 100% 102% 103% 98% 98% 98% 101% 100% 102% 102% 101% 103% *Planning capacity figures exclude temporary modular classroom spaces Scenario 4 - No Increased Capacity ACTUAL FORECAST Scenario 1 - Full Capacity Extension to 1150 Scenario 2 - Gradual Capacity Increase to 950 with Reduced Extension or Option 4 Scenario 3 - Gradual Capacity Increase to 925 with Reduced Extension or Option 4 Page 98
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Report to: Moray Council Meeting Date: 28 January 2026 Report by: Executive Director Economy, Enterprise and Operations Author: Alasdair McEachan Contact Email: Alasdair.mceachan@moray.gov.uk Subject: Scheme of Administration – Revised Remit for Audit and Scrutiny Committee 1. PURPOSE ☒ For Decision ☐ For Information 1.1 The purpose of this report is to recommend a change to the Council's Scheme of Administration 1.2 This report is submitted to the Council in terms of paragraph II (10) of the Council’s Scheme of Administration relating to changes to the functions of committees. 2. SUMMARY 2.1 A review of the functions of the audit and scrutiny committee has been carried out following a recommendation from external auditors. 2.2 Additional areas of responsibility for the Audit and Scrutiny committee are suggested for members consideration and approval. 3. RECOMMENDATIONS 3.1 It is recommended that the Council consider and approve a revised remit for the Audit and Scrutiny Committee shown in italics in Appendix 1. Alasdair McEachan Chief Governance Officer (Monitoring Officer) 4. BACKGROUND AND CONTEXT 4.1 The Council's Scheme of Administration, a document setting out the remit of each committee of the Council, was last reviewed on 25 June 2025. 4.2 Following an Accounts Commission Best Value audit a recommendation was made that the Council should review the remit of its Audit and Scrutiny committee. Item 10. Page 99
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4.3 Suggestions for additional areas of remit for the Committee were gathered from Committee members and draft proposals were circulated to the Committee. These received broad agreement. 5. PROPOSALS 5.1 it is proposed that the areas detailed in paragraph 5.2 are added to the scrutiny remit of the Audit and Scrutiny committee within the Council’s Scheme of Administration. 5.2 Proposed new areas of remit for A&S Rationale To scrutinise overarching service performance issues arising from service performance reports (which are common to more than one service committee) and to make improvement recommendations in relation to these issues. Service committees scrutinise service performance issues. It is proposed that this continues but there is also an opportunity for the Audit and Scrutiny committee to make improvement recommendations on specific performance issues which are common to more than one service area, with guidance developed on how such issues are identified for consideration by the committee. To scrutinise overarching improvement themes relevant to the Council's policy and regulatory landscape (which are not subject to scrutiny through a particular service committee) and to make recommendations in relation to these themes. There are some improvement themes (for example poverty) which do not fall neatly within existing corporate and service performance reports. It is proposed that such improvement themes can be considered by the Audit and Scrutiny Committee with guidance developed on how such issues are identified for consideration by the committee. Themed accounts Commission reports These reports are currently being reported to Audit and Scrutiny committee with no reference in the Scheme of Administration. It is proposed that this reference is added. Improvement activity arising out of corporate Public Sector Improvement Framework (PSIF) audits. The outcome of PSIF is currently captured in service plans and team plans. There would be merit in monitoring continuous improvement activity across services with an annual report. It its proposed that this annual report is considered by the Audit and Scrutiny Committee. Annual governance statement The Annual Governance Statement is included with the annual accounts and is not currently reported separately to committee.. There would be merit in separate scrutiny of the Statement which would give the committee an opportunity Page 100
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to look more generally at Council governance arrangements. It its proposed that this is considered by the Audit and Scrutiny Committee. Draft annual accounts (from 2027) Draft accounts currently go to Moray Council in June with final accounts going to Moray Council in September. There would be an opportunity for the Audit and Scrutiny committee to consider the draft accounts in June, rather than Moray Council. The material for this report is normally received very close to the committee date and the timetabled meeting of Audit and Scrutiny committee in June 2026 would not accommodate this. It is proposed to implement this proposal from June 2027 to allow for revised committee dates. 5.3 Proposed amendments to the Council’s Scheme of Administration to incorporate these responsibilities are shown in italics in Appendix 1. 6. SUMMARY OF IMPLICATIONS 6.1 The table below shows whether risks and implications apply if the recommendations are agreed: SUBJECT YES NO Corporate Plan and 10 Year Plan (Local Outcome Improvement Plan) x Policy and Legal x Financial x Risk x Staffing x Best Value and Transformation x Property x Information Communications Technology/Digital x Equalities. Social Inclusion and Economic Impact x Climate Change and Biodiversity Impact x 6.2 Corporate Plan and 10 Year Plan (Local Outcomes Improvement Plan (LOIP)) None 6.3 Policy and Legal The Scheme of Administration sets out the areas of responsibility for each committee of the Council. The proposals should help improve overall Council governance, scrutiny and accountability. 6.4 Financial Page 101
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None 6.5 Risk Improved scrutiny arrangements will the Council monitor and control corporate risks. 6.6 Staffing It is anticipated that the time for preparing additional reports can be accommodated within existing staff resources. 6.7 Best Value and Transformation Review of the remit of the Audit and Scrutiny committee is a current action in the Council’s Best Value Action Plan. 6.8 Property None 6.9 Information Communications/Technology/Digital None 6.10 Equalities, Social Inclusion and Economic Impact None 6.11 Climate Change and Biodiversity Impacts None 7. CONSULTATION 7.1 This report has been prepared in consultation with the Chair of the Audit and Scrutiny Committee, Central Leadership Team and the Audit and Risk Manager, and any comments made have been incorporated into the report 8. BACKGROUND PAPERS 8.1 Council Scheme of Administration. Page 102
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APPENDIX 1 (I) AUDIT AND SCRUTINY COMMITTEE The following functions of the Council shall stand referred or delegated to this Committee: STANDARDS (1) To ensure that the highest standards of probity and public accountability are demonstrated. AUDIT FUNCTIONS (2) Considering reports from the Council’s Internal Auditor. (3) Considering reports from Audit Scotland concerning Council functions. (4) Contributing towards making the Council, its Committees and Services more responsive to the audit function and its purpose. (5) Supporting the Council’s governance, risk and control arrangements by: • providing a review of the Annual Council Statement and the assurances underpinning it. • considering the effectiveness of the Council’s risk management arrangements • promoting internal controls and assurances • supporting an anti-fraud culture • review of revisions to financial procedures. (6) Oversee the independence, objectivity, performance and conformance to professional standards of Internal Audit. (7) Having responsibility for focussing audit resources through a process of agreeing on an annual audit plan. (8) Monitoring delivery of the audit service through receipt of quarterly reports on work carried out by Internal Audit. (9) Considering reports produced by the Council’s External Auditor. (10) Considering the annual assurance statement provided by Internal Audit on the Council’s control environment. SCRUTINY FUNCTIONS Page 104
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(11) To scrutinise areas of policy, service delivery or performance identified for improvement in: • External audit reports • Internal Audit reports • Performance reports • Reports from external regulators where there is insufficient evidence of progress from the appropriate monitoring committee. (12) To scrutinise overarching service performance issues arising from service performance reports (which are common to more than one service committee) and to make improvement recommendations in relation to these issues. (13) To scrutinise overarching improvement themes relevant to the Council's policy and regulatory landscape (which are not subject to scrutiny through a particular service committee) and to make recommendations in relation to these themes. (14) To receive reports on the performance of and trends within Council’s services as a whole in terms of Local Government Benchmarking Framework. (15) To consider wider scrutiny issues raised in themed accounts Commission reports. (16) To consider findings from corporate reviews under the Public Sector Improvement Framework. (17) To consider the Council’s Annual Governance statement. [(18) Change with effect from June 2027 : To consider the Council’s draft Annual Accounts in advance of submission of Final Accounts to the Council for approval] Page 105
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