Issue - meetings

RESOLVED:

1.1.         Approve the Council’s 2023-29 General Fund Capital Programme which includes planned expenditure of £486.53m (including capitalisation directions) across the six years.

1.2.         Approve the Council incurring nil borrowing for 2023-24, with borrowing projected of £28.38m in 2024-25 and £175.17m over the four years after 2024-25. The cost of this borrowing will be factored into the Council’s Medium Term Financial Plan for final agreement at Full Council resulting in 2024-25 total interest charge and Minimum Revenue Provision of £72.5m.

1.3.         Approve the Council 2024-25 Housing Revenue Account (HRA) Capital Programme with a total investment planned of £57.26m with borrowing of £24.80m.

1.4.         Approve an increase to the 2023-24 HRA capital budget from £33.248m to £37.162m, owing to increased major repairs and improvements, with this £3.914m increase funded by HRA reserves.

1.5.         Approve the Council’s Capital Strategy, as detailed within Appendix A of this report.

1.6.         Note the Council’s historic legacy borrowing and debt burden continues to be critical to the sustainability of the Council’s revenue budget. Dialogue with the Department for Levelling Up, Housing and Communities (DLUHC) continues, and the Council is seeking further financial support from Government in regards to its level of indebtedness and balancing the budget to ensure it can deliver sustainable local government services.

The Executive Mayor introduced the Capital Programme and Capital Strategy 2023-29 report, which outlined the strategic direction for Croydon’s capital management and investment plans. The programme saw the council make capital investments across the borough to provide improved infrastructure for residents whilst managing the impact of debt. Further, the strategy discusses planned expenditures from 2023 to 2029 and would deliver investment for the public in line with the objective of the Mayor’s business plan.

The Cabinet Member for Finance, Councillor Jason Cummings, in summary shared with Cabinet that the paper detailed the current forecast capital spending borrowing for the council, where debt and its associated costs were significant financial considerations in relation to the council’s sustainability, and therefore it was imperative that the council did all they could to manage capital spend. The forecast still resulted in an increase of the general fund debt due to the continuing need for capitalisation directions, which highlighted the ongoing unsustainable impact of capitalisation as a means of bridging the revenue gap for this council. However, the council had continued to bear down on capital expenditure, and the regular review of all capital expenses and slippage were ongoing.

The Shadow Cabinet Member for Finance, Councillor Callton Young, enquired on the Mayor’s debt write off negotiation with DLUHC, and asked what progress on the negotiations were being made, and further to provide a high level of indication of the alternative options that were being explored.

The Executive Mayor responded that there were further conversations with DLUHC officials at both civil servant and political level, with various options still under negotiations.

The Executive Mayor in cabinet RESOLVED to approve and to recommend the following to Full Council:

1.1.         Approve the Council’s 2023-29 General Fund Capital Programme which includes planned expenditure of £486.53m (including capitalisation directions) across the six years.

1.2.         Approve the Council incurring nil borrowing for 2023-24, with borrowing projected of £28.38m in 2024-25 and £175.17m over the four years after 2024-25. The cost of this borrowing will be factored into the Council’s Medium Term Financial Plan for final agreement at Full Council resulting in 2024-25 total interest charge and Minimum Revenue Provision of £72.5m.

1.3.         Approve the Council 2024-25 Housing Revenue Account (HRA) Capital Programme with a total investment planned of £57.26m with borrowing of £24.80m.

1.4.         Approve an increase to the 2023-24 HRA capital budget from £33.248m to £37.162m, owing to increased major repairs and improvements, with this £3.914m increase funded by HRA reserves.

1.5.         Approve the Council’s Capital Strategy, as detailed within Appendix A of this report.

1.6.         Note the Council’s historic legacy borrowing and debt burden continues to be critical to the sustainability of the Council’s revenue budget. Dialogue with the Department for Levelling Up, Housing and Communities (DLUHC) continues, and the Council is seeking further financial support from Government in regards to its level of indebtedness and balancing the budget to ensure it can deliver sustainable local government services.