To provide Cabinet with comments on the proposed additional capital investment programme for 2015/16 to 2017/18 inclusive for recommendation to Council on 12 December 2014.

The Chief Financial Officer presented the report, the key points included:

i.        Comments were invited from the committee on the proposed capital programme, for submission to Cabinet and subsequently to Council.

ii.       The current capital programme amounted to £146.7m.  The proposed additions to the scheme would cost £57.5m of which £48.6m would be funded from external sources.

iii.      A summary of the additions was appended to the report and an overview was provided of the principal requirements.

iv.      It was reported that the total outstanding debt was £168m as at 31 March 2014 and was being repaid at £10m per annum.  With additional investment already approved and the proposed additions identified in the report, the debt requirement would be £200m as at 31 March 2018.

v.       The authority had a long-term debt to asset percentage of 26%; this reflected the average position for all unitary authorities.

The principal points of the ensuing debate included:

1.       The Chief Financial Officer advised that the profile of the funding depended upon the details of the scheme involved; overviews were provided in relation to the South Wye Transport Package and Hereford Enterprise Zone.

2.       In response to a question from a member, the Chief Financial Officer explained that purchase of gritters would provide better value for money than leasing and the borrowing cost would be funded by the winter service budget.  The Director for Economy, Communities and Corporate said that a list of all vehicles in the council’s ownership would be provided to the member.

3.       Another member questioned why the savings in terms of vehicle leasing costs were not identified in the report and the Chief Financial Officer advised that the report identified capital programme intentions going forward, subsequent decision reports would set out the value for money and financing considerations in detail.  The member felt that there was an inconsistency in terms of presentation compared to the Hereford Enterprise Zone and the Chief Financial Officer said that he would review the relevant paragraphs before submitting the report to Cabinet. 

4.       The committee was advised that the Marches Local Enterprise Partnership Board was due to make a decision on the distribution of business rates and the identified investment in the Enterprise Zone would not proceed without a suitable arrangement in place.

5.       In response to questions about the Three Elms Trading Estate, the Head of Corporate Asset Management and the Cabinet Member for Contracts and Assets outlined the background to the issue and how the cost of borrowing would be funded from rental income.

6.       It was questioned whether investment in Colwall Primary School was being viewed in terms of the potential impact on schools provision in the wider catchment, especially given plans for the expansion of Ledbury Primary School.  The Chief Financial Officer said that the schools estate strategy was being updated and any investment would need to be made in the context of that strategy.  He added that a separate project was looking at various options for Colwall Primary School.  ...  view the full minutes text for item 27