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Delivering our Capital Programme
Council has committed to a significant capital programme to deliver the required infrastructure at the appropriate times and places across the district. There is a significant step up in capital expenditure from the 2020/21 budget to the 2021/22 budget of 59% ($22.9m). Of this, there is a 45% increase in renewals ($6.3m), and a 67% increase in budget for new capital projects relating to growth and increased levels of service ($16.6m). Refer to the graph on page 32 to see the Capital programme over the next ten years. To ensure that Council is able to deliver the capital programme, Council has invested in programmes and training to improve the deliverability of the projects that we deliver. This has included:
- Undertaking a review of the organisation to ensure resources (including staff) are allocated appropriately.
- Adopted a project methodology and trained staff in the methodology.
- Invested time at the outset to understand the full scope of our projects to improve our efficiency of execution.
- Prioritised our project portfolio against our strategic objectives to ensure we’re delivering the right projects at the right time.
- Reviewing the way that we procure projects. Where appropriate, and in line with our procurement policy, we bundle projects of a similar nature, similar location or similar work type or across a number of years together in one contract. This helps to increase efficiency and reduce costs.
There is however a high level of uncertainty associated with this.
ASSUMPTIONS
- Council’s investment (as outlined above) in project management methodology and the establishment of a project management office (PMO) will greatly assist in delivering our capital programme
- The consultant and contractor market will gear-up to be able to meet the demands of increased infrastructure spending locally and in the region.
RISKS
- Council will not be able to present projects to the market in time for them to be delivered as planned. The mitigation for this is the work Council has undertaken above.
- The consultant and contractor market will not be able to deliver on our planned project timelines. Mitigations include early contractor involvement, Supplier panels, bundling of contracts.
- The implication of this is that the projects would be moved out to a later date when contractors and consultants become available.
FINANCIAL IMPLICATIONS
- If projects are delayed loans may not need to be drawn down as planned which will reduce Councils overall debt and reduce interest costs in the short term.
IMPACT ON LEVELS OF SERVICE
- There is a risk the community won’t get the levels of service we expect to deliver. For example, if a renewals project is affected, it increases the risk that there could be a decline in levels of service along with possible asset failures.