Capital Financial Performance Report - Q3 of 2020/21 (EX3912)
Purpose: The financial performance report provided to Members on a quarterly basis reports on the under or over spends against the Council’s approved capital budget. This report presents the Quarter Three financial position.
Resolved that the forecast financial position as at Quarter Three be noted.
This decision is not subject to call in as:
· Report is to note only
therefore it will be implemented immediately.
The Executive considered a report (Agenda Item 10) concerning the Capital Financial Performance Report Quarter Three 2020/21.
Councillor Ross Mackinnon stated that at the end of Quarter Three, expenditure of £42.9 million had been forecast against a revised budget of £48.3 million, an overall forecast underspend of £5.4 million which was an improved position from Quarter Two due to £7m of projects being reprofiled into the next financial year. This did not mean that the projects would not be going ahead but they had been delayed mainly due to the Covid pandemic. Of the reprofiled projects £4m were environmental projects and £2.5m were around education.
Councillor Richard Somner agreed that in his portfolio, Transport and Countryside, the past year had been challenging. He gave his thanks to both Officers and contractors who had achieved a great deal. There had been some excellent work going on and the Council had managed to move timelines to accommodate the continuation of that work.
Councillor Jeff Brooks noted the difficult circumstances of the last year but he again highlighted the movement of forecasts. In the last three months there had been a £7m movement in the underspend position. Getting a forecast as accurate as possible was important along with not having big movements. Decisions were made on forecasts and if they were way out as had been the case in the current year and in previous years then bad decisions could be made. The position could change even further in the next three months with a larger underspend at year end. Councillor Mackinnon did not completely disagree with Councillor Brooks but the Capital Programme had been set in March 2020 and therefore it would be odd not to see large fluctuations in the programme being spent out throughout the financial year. He agreed that budget holders needed to be accountable and forecasting needed to be good but if there was a clear logic for the variance then he was less concerned particular in such a difficult year.
Councillor Erik Pattenden referred to section 5.5 which mentioned that there would be a £1.4m in Education Services due to delayed projects and which would be carried forward into the next financial year. He was concerned that this would be on top of the £8m of capital projects scheduled for 2021/22 and he queried what was being done to ensure that all of these projects would be completed particularly as there had been questions about the project management capability. Councillor Mackinnon was hopeful that after the Covid pandemic things would bounce back very quickly. He stated that there might be potential project management issues but he had faith in those in charge of the capital programme and their ability to manage those issues.
Councillor Adrian Abbs asked for clarifications on the £4m of environmental projects which would be reprofiled into the following year as this was particularly concerning considering that the country was in a climate emergency. Councillor Mackinnon confirmed that there were a lot of small projects which cumulatively added up to £4m and therefore he would not read them all out but referred C Councillor Abbs to the Executive agenda pack from 17 December 2020 – page 279 where they were listed.
Councillor Dominic Boeck felt that the Capital Programme was one of the most exciting aspects of the Council’s work. The fact that it is spending this money meant that it was improving things for local residents. It was disappointing that at Quarter Three it was behind with the programme but as mentioned there had been a good reason for this. He was particularly pleased to note that two new schools had been delivered. Councillor Boeck had confidence that the Council had the project management capacity and capacity within the industry to ensure that the money was spend through to the end of this year and into the next financial year.
RESOLVED that the report be noted.
Other options considered: No other options were considered.