Item 14 - General Services Capital Budgetary Control Report 2024 25 to 31 October 2024 (Period 7)
West Dunbartonshire Council · 18 December 2024
Back to West Dunbartonshire Council — 18 December 2024 and its agenda
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WEST DUNBARTONSHIRE COUNCIL Report by Chief Officer - Resources Council: 18 December 2024 Subject: General Services Capital Budgetary Control Report 2024/25 to 31 October 2024 (Period 7) 1. PURPOSE 1.1 This report provides an update on the General Services capital financial performance to 31 October 2024. 2. RECOMMENDATIONS 2.1 Members are asked to: i) Note the current position of the 2024/25 General Services capital budget. ii) Approve additional capital budget of £0.133m in respect of Posties Park. iii) Approve the revised completion dates detailed in Appendix 3. iv) Note an in-year variance of (£6.308m) due to reprofiling and additional funding made available by Scottish Government. v) Approve £1.000m capital budget for a new financial ledger system and the associated £0.028m per annum revenue costs to cover the interest on the prudential borrowing over 20 years of the life of the asset. vi) Grant delegated authority to the Chief Officer Resources to award the contract in relation to the new financial ledger project following market testing, using an appropriate procurement route. 3. BACKGROUND 3.1 On 6 March 2024 the Council approved the updated General Services Capital Plan for 2024/2025 to 2032/33. The three years from 2024/25 to 2026/27 were approved in detail with the remaining years being indicative. The budget agreed was £76.757m for 2024/25 and £318.357m for the project life budget. 4. MAIN ISSUES 4.1 Exhibit 1 sets out the revised capital budget at period 5 as reported to Council on 30 October, 2024. ITEM 14
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Exhibit 1: Revised Capital Budget at 30 October 2024 2024/25 (£m) Total Project Life (£m) Capital Budget Agreed 6 March 2024 76.757 318.357 Updates reported to Council on 28 August and 30 October plus adjusting for year end carried forward balances. 2.071 (1.522) Reprofiling reported to Council on 28 August and 30 October. (16.354) 0 Proposed revised Capital Budget as at Period 5 62.474 316.835 4.2 Progress against the 2024/25 capital plan is detailed in: Appendix 1 – Project Life Summary by Chief Officer Appendix 2 – Off Track Projects Appendix 3 – Changes to Capital Plan for Noting Appendix 4 – All Approved Projects 4.3 The overall programme summary report at Appendix 1 shows that planned expenditure is lower than the budget agreed by £0.166m mainly due to three projects not utilising their full budget. 4.4 Appendix 2 highlights three projects currently showing as off track. Two projects (RN17 Posties Park and EDUC03 Faifley Campus) require additional budget and one project (RN28 Balloch Mountain Bike Track) is off track due to revised completion dates. • EDUC3 Faifley Campus –given ongoing volatile market conditions there is an increase in the expected labour and material costs at Faifley Campus. The estimated cost of Faifley Campus has been increased by £0.895m to £36.515m. At this stage, however, it is anticipated that this increase can be accommodated within the overall School Improvement capital budget which is currently unallocated. • RR17 Posties Park – additional budget of £0.133m required for utility costs incurred as part of the capital build project. • RN28 Balloch Mountain Bike Track – completion date amended due to revised project scope. 4.5 Appendix 3 highlights eleven projects where the project expenditure requires to be reprofiled but there is no need for approval of additional budget. It also highlights three projects already existing in the capital programme where additional funding has been made available by the Scottish Government. • RN32 – Cycling, Walking, Safer Route Tier 1 (Active Travel) – additional Scottish Government funding of £0.257m. • RN34 – Strathclyde Partnership for Transport Bus, Cycling and Walking Infrastructure Improvements & Park & Rides – additional Scottish Government funding of £0.310m. • EDUC05 - Free School Meals Project – additional Scottish Government
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funding of £1.190m. 4.6 Appendix 4 shows all projects with approval in year and project life budgets as well as anticipated expenditure. It highlights that the 2024/25 budget is £64.479m with current forecast spend of £58.399m, a variance of £6.080m which relates to projects require reprofiling. The spend as at period 7 is £23.819m (39.71%) of the current forecast spend of £58.399m. 4.7 Members are asked to approve additional capital budget of £1.000m to fund the replacement of the Council’s financial ledger system (Agresso). The current financial system has been in use since 2006/07. The current provider has advised the Council they will no longer support locally installed versions of Agresso and therefore there is a risk of systematic failure. It is an appropriate time to review alternative systems and perform an options appraisal on available systems and compatibility with other Council systems. The capital costs requested (£1.000m) are an initial estimate of the potential cost implications if the Council decide to replace the current system with a new system and includes associated installation, hardware configuration, consultancy costs and training costs. This is based on similar projects recently carried out at other Local Authorities. It is anticipated the replacement system will result in an increased revenue cost to the Council as a result of the different licencing model and ongoing revenue implications will be reported to a future Council meeting once these are known. The bid has been reviewed by Strategic Asset Management Group who recommend that £1.000m is added to the Capital plan to procure a replacement financial ledger system and to grant delegated authority to the Chief Officer Resources to award the contract following market testing, using an appropriate procurement route. 4.8 Exhibit 2 sets out the revised capital budget at period 7 assuming approval by Council of all recommendations contained within this report. Exhibit 2: Revised Capital Budget at 18 December 2024 2024/25 (£m) Total Project Life (£m) Capital Budget as at 30 October 2024 62.474 316.835 Reprofiling Projects and new funds as reported in Appendix 3) (6.308) 1.757 Added RN17 additional funding Posties Park 0.133 0.133 Added RES14 replacement of Council’s financial ledger system 0.100 1.000 Proposed revised Capital Budget as at Period 7 58.399 319.725 5. PEOPLE IMPLICATIONS 5.1 There are no people implications in relation to this report.
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6. FINANCIAL AND PROCUREMENT IMPLICATIONS 6.1 The report notes the projected in-year financial position for capital budgets. There are no procurement implications as a result of this report. 7. RISK ANALYSIS 7.1 The main risks are as follows: (a) The reported variances should be viewed in the knowledge that there are a number of variable factors which could arise between now and 31 March which could affect the year end results for capital budgets. (b) As a consequence of current market conditions, inflation is at an all-time high and interest rates continue to be volatile. To forecast for the full year costs budget assumptions have been required. These assumptions continue to change regularly and therefore it is likely the projected year end budgetary position will change from that reported. 8. EQUALITIES IMPACT ASSESSMENT (EIA) 8.1 No equalities impact was required in relation to the production of this report. 9. CONSULTATION 9.1 All services involved in delivering the capital budgets have been consulted in the compilation of this report. 10. STRATEGIC ASSESSMENT 10.1 Proper budgetary control and sound financial practice are cornerstones of good governance and support Council and officers to pursue the strategic priorities of the Council’s current Strategic Plan. This report forms part of the financial governance of the Council. Laurence Slavin Chief Officer - Resources Date: 29 November 2024
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Person to Contact: Jackie Thomson. E-mail: jackie.nicolthomson@west-dunbarton.gov.uk Appendices Appendix 1 – Project Life Summary Appendix 2 - Off Track Projects Appendix 3 - Reprofiling and Acceleration of Projects Appendix 4 - Details of all Projects. Background Papers General Services Capital Plan Update - Council 6 March 2024. Capital Budgetary Control Report (P3) – Council 28 August 2024 Capital Budgetary Control Report (P5) – Council 30 October 2024