Agenda item

The Value for Money and Customer Service Overview and Scrutiny Committee has identified a potential in-depth review of the Capital Expenditure Process and Management, the draft scoping document is attached.

Recommendation

It is recommended that the Value for Money and Customer Service Overview and Scrutiny Committee approves the scoping document for the proposed review and agrees to establish a Task Group to undertake the review.

Cllr Mike Band introduced the proposed scope for the in-depth review into Capital Programme slippage, which had been identified as an area for further scrutiny at the last meeting. He explained that he had worked with the accountants to identify the figures set out at Annexe 2 to the scope, which showed that a significant amount of slippage occurred throughout the year.

Cllr Nasir agreed that this was a very worthwhile review topic, and stated that it needed to be investigated; otherwise the situation could potentially become worse. Cllr Martin agreed, stating that he would expect to see some slippage, but not the extent set out in the table at Annexe 2 to the report.

Damian Roberts, Strategic Director – Front Line Services, stated that there was a need to encourage officers to be more realistic up front about what could be achieved each year, and to not be afraid of drawing funds forward from future years if a project was progressing particularly well.

The Committee acknowledged that there may be genuine reasons why a project could not be delivered, but that in such cases, there should be a mechanism in place to bring forward alternative projects.

Cllr Mulliner noted that the one of the key aims of the review should be to identify why slippage occurs, and suggested that this be added to the bullet points under the heading ‘rationale for the review’. Members also noted the distinction between capital expenditure and capital approvals, and asked officers to produce figures for these separately.

Peter Vickers, Head of Finance, explained that measures were being put in place to address some of the concerns raised by the Committee. A new ‘Agresso’ module was being implemented, and the capital budget process had been revised to show the overall approval, not just year on year expenditure. New processes had also been agreed with the accountants to facilitate bringing forward smaller projects. He added that all capital bids required a template to be completed which included details of how the procurement would be undertaken.

The Committee agreed that a task group would be able to look at previous examples where a capital project had slipped, identify what had gone wrong and assess whether the new arrangements would be sufficient to prevent similar occurrences in the future. It was suggested that as the Capital Programme referred to both the General Fund and HRA, a member of the Housing Overview and Scrutiny Committee be invited to join the task group. The Committee also suggested that officers set out a target Executive date for reporting the outcomes of the review.

The Committee approved the review scoping document as set out in report and resolved to appoint a task group comprising Cllrs John Williamson, Mike Band and a representative from the Housing Overview and Scrutiny Committee to undertake the review.* Cllr Gray, as Chairman of the Audit Committee, was also invited to attend the working group.

*Following the meeting, it was confirmed that Cllr Richard Seaborne would join the task group as a representative of the Housing Overview and Scrutiny Committee.