Report by Director of Finance

Further to Minute 54 of the Policy Committee held on 19 February 2024, the Director of Finance submitted a report setting out the draft Capital Strategy 2024/25, which was attached to the report at Appendix 1.

The report noted that the CIPFA 2021 Prudential and Treasury Management Code required the Council to prepare a Capital Strategy report which set out the Council’s capital requirements arising from policy objectives, as well as the associated governance procedures and risk appetite of the Council.  The Strategy provided an overview of how capital expenditure, capital financing and treasury management activity contributed to the provision of services; along with an overview of how associated risk was managed and the implications for future financial sustainability. 

In December 2023, the Government launched a new consultation relating to additional flexibilities to use capitalisation without the requirement to approach Government. The outcome of this consultation had not yet been announced, which meant the Council’s use of capitalisation and capital receipts had all been based on the existing guidance and legislation. Consequently, there may be a requirement for amended policies to be brought back to Council for approval in advance of February 2025.

The Capital Strategy set out the Council’s approach to asset management planning, development, and monitoring of the Capital Programme’s delivery.  The figures in the various tables within the Capital Strategy had been updated to reflect the latest position consistent with the MTFS report (see Minute 43 above).  The Action Plan at Appendix 1 Annex C to the report had been refreshed and the Director of Finance would keep this under review during the year and would bring forward any changes that may be required.  The Capital Programme Board chaired by the Director of Finance had been introduced in December 2022 to increase oversight of the Capital Programme and its delivery.  Terms of Reference for the Board were included at Appendix 1 Annex B.

The proposed Action Plan of the Strategy identified four areas of ongoing work required for the Council to remain compliant with the CIPFA code requirements. These were:

·       Developing knowledge of the Council’s existing asset base;

·       Identifying what assets would be needed in the future;

·       Developing and implementing new systems and processes, which enable full compliance with the Code requirements;

·       Reviewing current capacity and skillsets within the organisation.

The following motion was moved by Councillor Brock and seconded by Councillor Gittings and CARRIED:

Resolved –

(1)        That the Capital Strategy 2024/25, as attached at Appendix 1 to the report, be approved;

(2)        That the updated Action Plan that formed Annex C of the Capital Strategy (Appendix 1) be noted, together with the associated financial implications.