To consider the Capital Programme.
The Chair will also update the Committee on Ysgol Cymraeg Y Trallwyng.
Minutes:
· Capital Programme
Discussion:
· The Chair had copied Members of the Committee into an exchange of emails regarding Ysgol Cymraeg Trallwng – this would not be discussed during Committee but would be the subject of a future report.
· There had been concerns regarding the affordability of the capital programme as presented and correspondence between the Chair, Portfolio Holder for Finance and Head of Finance had sought assurances that the strain on the revenue budget would not be so great.
· The Chair of the Finance Panel explained the background and that he had been concerned at the strain the capital programme would put on the revenue budget. Increased costs of £5M this year, £5M the following year and £3M the year after were a cause for concern. The Head of Finance stressed that the capital programme must be considered within the context in which it had been proposed. It also sat alongside the Treasury Management Strategy. Plans must be affordable, and the Council will only approve one year at a time. The cost of doing nothing should also be considered. The increased costs were also attributable to the change in Minimum Revenue Policy (MRP) – the benefits of which had accrued over the preceding years.
· A Member raised the issue of whether small secondary and primary schools would be viable in the future – this was a matter for the Learning and Skills Scrutiny Committee
· A five-stage business case would have to be completed for each proposed capital project. This would include the outcomes achieved including the impact on the revenue budget.
· It was considered that the quality of project management was a concern and that the build quality and scrutiny of work completed needed more attention. The Head of Finance agreed that the Audit Committee could be provided with an overview of project management from an appropriate officer.
· The Chair of the Schools Forum had been invited to attend the meeting but, due to technical difficulties, had been unable to join. The Chair summarised the points that had been raised by the Schools’ Forum and a letter was circulated to Members after the meeting. The Schools Forum had concerns regarding escalating costs, strain on budgets and whether the Welsh Government contribution to future projects would remain the same. It was considered that ‘Rolls Royce’ options were chosen over more basic alternatives.
· The Chief Executive informed the Committee that not all authorities publish a long-term programme and that last year had been the first time that Powys had published a 10-year programme. A framework needed to be in place and horizons should not be narrowed. Governments tend to prioritize capital spend to boost economies. There was a need to consider the programme corporately and to review it regularly. Borrowing is only one element to be considered.
· It was thought that many of the projects would deliver a social dividend but would not pay for themselves. The issue of value for money must be addressed and cost-effective projects considered.
· Audit Wales reminded Members of the remit of an Audit Committee and that a number of points considered today would more appropriately sit with other processes or scrutiny committees. The Committee must understand where it can gain assurances.
Supporting documents: