Councillor Hebb presented the Capital Strategy report which set out the strategic framework underpinning capital expenditure and the associated financing at the Council. In accordance with the above Codes, this report set out the Capital strategy for 2022/23, confirmed the proposed Prudential Indicators and set the Capital and Treasury Management projections for 2022/23.
Members were made aware of some sub-amendments to the report.
Treasury Management Strategy, Annex 1, Table 2.3
· Under 31/3/2023 (a) Total borrowing equated to 16,353 and not 16,343 as stated in the report.
· Under 31/3/2024 (a) total borrowing was 1,584,084 and not 1,584,984 as stated in the report.
· Under 31/3/2024 (b) less external borrowing was 31,947 and not 38,847 as stated in the report.
Treasury Management Strategy, Annex 1, Table 2.32
· Under 2021/22 (a) total payment was 19,606 and not 19,706 as stated in the report and therefore the net interest credit was 25,898.
Councillor J Kent thanked Councillor Hebb for the introduction and how the report had been split to show the strategy for borrowing under capital projects and secondly to look at the money borrowed to invest. That Labour continued to support an invested approach which had started as far back as 2014 when £20m had been invested into the CCLA, this approach had been refreshed and accelerated in 2017 with a clear accountability and that any investments over £10m, for longer than a year would be presented to all group leaders and deputy leaders before any commitments were made. Councillor J Kent stated he, nor his predecessor, had ever received a presentation on any proposed investment. The borrowing limit had been increased in February 2018 for the year 2018/19 but by the end of the year that limit had exceeded and had risen to over £1b without any reference to Full Council as was required when there was a material change to the Council treasury strategy and was far from the open approach that had been promised. There was a lack of transparency and openness in continuing to answer any freedom of information requests and spoke about the judge led tribunal. That some of the risks were now known associated with some of those investments and questioned how confident the portfolio holder was in the security of the investment with Pure Well Energy. Also questioned the portfolio holder what assessments he had made on the security of the investment of £145m to Toucan Energy Holdings. Councillor J Kent also asked the portfolio holder whether the person who had arranged that investment had taken a £5m payment from the Council as a way of commission and asked for confirmation that if this was the case were the portfolio holder and the leader aware of that payment. The portfolio holder was also asked how confident he was that those initial investments would be repaid in full. Councillor J Kent believed the administration had borrowed too much and shown where those investments had been made and failed to demonstrate the openness as promised. Councillor J Kent moved to the strategy to deliver capital projects in Thurrock and agreed there was much that the Labour group agreed on. They agreed on the proposal of replacement vehicles for the environment team and those vehicles should be zero omission had been considered and asked the portfolio holder to report back to Council before those vehicles were procured so members could judge the process made in finding those zero omission alternatives. Agreed with the plans to replace the Orchard Road foot bridge in South Ockendon but remained unconvinced that cabinet could deliver capital schemes on time or in budget. Councillor J Kent asked the portfolio holder for the current estimated costs for the A13 widening and the completion date. Some three years ago the work started on the Stanford station to be completed in September 2022 at a cost of £11m, the station had still not been rebuilt and the costs had risen to £30m. The new Civic Offices still remained unopened and questioned the portfolio holder what steps he going to take in future to ensure that capital projects would be delivered on time and in budget.
Councillor Byrne referred to the delayed projects in Thurrock, A13, Stanford Station, Integrated Medical Centres and the new Civic Offices and questioned how out of control had the spending been on these poorly managed projects. There needed to be due diligence, high management skills and on-time budgets every time. The Council had continued to fail on projects every time and as previously stated the Council needed to get their house in order first.
Councillor Duffin stated he never heard before two opposition leaders detesting the £115m investments being made into the borough and stated they made it sound like the Council was in £115m debt, instead thanks should be given to Sean Clark and the finance team on the work that had been undertaken.
Councillor Hebb welcomed the support but around the question of uncertainty the portfolio holder did not know of any Council or Government that had just gone through this health crisis, which had put extra pressures on to adult and children’s social care services, had continued to earn £115m and had survived 24 months of that pandemic. This was therefore a significant assurance that the decisions made were the right decisions. Councillor Hebb made reference to previous discussions with members and officers and how the Council spending review approach changed and how this was discussed and agreed between those present at the meetings. Councillor Hebb referred to the judge led tribunal and the matter would now be reheard by a freshly constituted tribunal where the Council would have the opportunity to provide evidence and arguments about the commercial sensitivity preventing this disclosure and all the exemptions around this legislation. In regard to increased oversight it was agreed that a more purpose driven mechanism to monitor the oversight of interests would be undertaken and a meeting had been held a few months ago but although a lot of information on the investment committee had been provided it was decided instead to add an addendum to the General Services Committee. Referred to the zero omission vehicles and Orchard Road which the relevant portfolio holders would pick up on. In regard to capital projects there were things that needed to be improved on as a Council, but updated reports had been presented to the General Services Committee, Planning Transport and Regeneration Overview and Scrutiny Committee and the Standards and Audit Committee. As part of the solution was to get the right talent and the right capability into the organisation to ensure that those projects were delivered as residents and councillors would expect and also what officers would want.
1. Approved the Capital
Strategy for 2022/23 including approval of the Annual Minimum
Revenue Provision (MRP) statement for 2022/23;
2. Approved the
adoption of the prudential indicators as set out in Appendix 1;
3. Noted the revised 2021/22 and 2022/23 Treasury Management projections as set out in Annex 1 paragraph 2.32.