STRATEGIC ASSET MANAGEMENT PLAN
YEAR 1 REVIEW (2012/13)
June 2013
1. INTRODUCTION
1.1 Purpose and Scope of the Review
The Strategic Asset Management Plan (SAMP) was approved by Council in January 2012. This is the first review and update of the Plan. It will identify any changes in key strategic and service influences that affect our assets. It will also review the key issues in Asset Management and measure progress against the 2012/13 Annual Action Plan to inform a new Action Plan for 2013/14. A new Service Risk Register (Appendix 1) has been developed to take into account these influences and the progress made during 2012/13. The actions and priorities within the new Action Plan flow from the Risk Register.
2. STRATEGIC INFLUENCES FOR CHANGE
2.1 Resource Context
The Council is facing the most challenging round of local government settlements in many years, including year on year cuts in real terms in Welsh Government revenue grant and unprecedented reductions in general capital funding approvals. The Council will need to make revenue budget savings of £18million over the period 2014 to 2020 and levels of possible capital investment will fall well below the identified needs of the area. The Council’s strategic approach to the management of its resources is set out in the Medium Term Financial Strategy 2013/14 to 2019/20 and will seek to safeguard budgets in the key priority services – initially this is regarded as mainly Schools and front-line Social Services.
The approach to balancing the budget over the next seven years will focus on 3 key themes, all of which will influence the Council’s requirement for assets and support the delivery of required revenue savings and capital receipts:
• Service reviews and alternative forms of service delivery
• Workforce Challenge Strategy
• Workplace Transformation
Service Reviews and alternative forms of service delivery
Education and Social Services are identified as priority services moving forward for the Council. Challenging revenue targets for lower priority services could potentially affect the quality, and in the case of non-statutory services, the actual provision of services. Service reviews and alternative methods of service delivery are being considered as a key theme within the MTFS and provide a potential solution to safeguarding some services whilst still delivering the required revenue savings. The Welsh Government’s drive towards collaborative and partnership working to deliver both efficiency savings and improved services will also provide options for alternative forms of service delivery and consequential property requirements.
Service reviews will be instigated across all portfolios during 2013/14 in order to meet the funding gap, channel resources into priority areas and to inform the 2014/2015 budget process. The service and asset implications are discussed in more detail below. Strategic asset management by definition considers the broad direction for the Council’s assets in the medium term. However, this is becoming increasingly difficult to strategically plan for without a clear collaboration and service delivery blueprint and the need to work reactively in response to the rapid pace of change.
Workforce Challenge Strategy
A strategic approach to meeting the workforce challenges relating to the financial climate facing the Council will assist in aligning staff resources to the priorities of the Council and assist in generating savings in the short, medium and long term. This will have a direct influence on our accommodation needs and in particular the Workplace Transformation programme.
Workplace Transformation
It is anticipated that the workplace transformation programme will allow more flexible working practices using enhanced ICT arrangements. The financial impact of Workplace Transformation will arise from a reduction in the number of buildings (and subsequent buildings operating costs) combined with operational efficiencies derived from agile working. The programme is managed within the Asset Management team and progress to date is detailed below.
2.2 Single Integrated Plan
The Council has produced a Blaenau Gwent Single Integrated Plan 2013 to 2017. The purpose of the Plan to set out the main priorities for partnership working, and what we will need to do to make Blaenau Gwent an even better place to live, work and visit. The shared vision is for an exciting future in which everyone experiences the benefits that will come from the regeneration of our communities. The new Plan replaces the separate statutory plans which were previously in place including the Community Strategy. Five themes have been identified, as shown in the diagram below:
The Blaenau Gwent Strategic Partnership Framework was established in May 2012 to streamline the partnership arrangements and replace some of the existing Partnerships including Children and Young People and Regeneration. Asset Management has an important role to play in supporting the Partnership Framework. The People and Places Partnership is responsible for ensuring that there are effective partnership structures in place for delivering priority action plans for each theme. The Local Service Board Officer Network (LSBON) will support the People and Places Partnership and also provide over-arching tactical advice and guidance to the Local Service Board. It will oversee five supporting functions including asset management. Integrating asset management into the community planning process will ensure a two-way flow of information and that:
1. The asset implications flowing from delivery of the action plans for each theme, including opportunities for co-location, are fully explored
2. The Partnership is kept fully briefed on opportunities arising from the collaborative asset management project detailed below
The new structure is shown below (note: the Commissioning function is to be renamed Commissioning, Resources and Assets).
3. SERVICE PRIORITIES AND INFLUENCES – ASSET IMPLICATIONS
The main influences for change and service priorities are detailed below. The asset implications by building type/portfolio are also detailed and summarised in Appendix 2. We have not undertaken service asset management plans. We are instead taking a place based approach to asset management to complement the neighbourhood approach in the Single Integrated Plan, the Area Reviews and our collaborative asset management work.
3.1 Resources Directorate
The Council’s IT service is now delivered collaboratively with Merthyr CBC and we are working closing with an integrated team on the Workplace Transformation programme. The Service Improvement team are responsible for leading on various service reviews, the consequences of which could have a major effect on our future property requirements.
3.2 Environment & Regeneration Directorate
Environmental Services
Blaenau Gwent is continuing to work closely with its neighbouring councils around the procurement of contracts for the treatment of various waste streamsin order that economies of scale can benefit all parties including the financial benefits of shared costs. Further opportunities are being looked at around collaboration and shared services under a review being undertaken by Peopletoo and a report is expected in the near future. A report will be produced early in 2013/14 around the options for future civic amenity site provision across the authority with a view to addressing a substantial cost pressure in the Waste Management budget. Developments at the Silent Valley Landfill site are being expanded in order to deal with future service delivery and capacity issues which may offer opportunities for shared usage. There are also opportunities to offer our Vehicle Maintenance workshops to partner organisations and discussions are ongoing.
Environmental Services staff are currently split across four sites. The main Central Depot requires re-modelling to address condition, suitability and asbestos issues. An outline business case has been approved recommending re-location of non-operational staff and the Call Centre to the Civic Centre/Bridge Street offices as part of the Workplace Transformation programme. This will enable co-location of the Environment and Regeneration Directorate as a whole.
Technical Services
Technical Services have now taken on the Corporate Landlord role which is currently being developed (see below). Design work is being undertaken on behalf of other Local Authorities including Merthyr Tydfil CBC and Monmouthshire CC under collaborative arrangements.
The national performance indicators submitted for 2011/12 in respect of our maintenance repair backlog and expenditure are summarised below. It should be noted that the actual maintenance spend only represents 10% of the maintenance required. The Council does not have the resources to effectively address the backlog of maintenance. Realistically, property rationalisation is the only option available to significantly reduce the backlog. The ongoing 21st Century Schools reorganisation programme, Workplace Transformation and the service reviews considering alternative methods of service delivery will contribute to relieving this budget pressure. The Area Review report also makes recommendations as to potential building closures
PERFORMANCE INDICATOR / 2010/11 / 2011/12 / Year on year changeValue of required maintenance by priority
Urgent (Level 1) / £0.722m / £0.682m / -£40k
Essential (Level 2) / £9.151m / £8.282m / -£869k
Desirable (Level 3) / £10.584m / £10.530m / -£54k
Total Required Maintenance / £20.457m / £19.5m / -£957k
Percentage of gross internal area by condition category
Good / 10% / 12% / +2%
Satisfactory / 54% / 54% / No change
Bad / 33% / 32% / -1%
Poor / 3% / 2% / -1%
Expenditure on maintenance
Responsive / £1.5m (75%) / £1.8m (90%) / +15%
Planned / £0.5m (25%) / £0.2m (10%) / -15%
Total Expenditure Maintenance / £2m / £2m / No change
How these indicators compare to the Wales average and other Local Authorities is shown in the diagrams below. The data is taken from the Asset Management Benchmarking Report November 2012 by the Local Government Data Unit.
As can be seen from the second diagram, the Council is significantly below the Wales average in terms of the percentage annual spend on responsive maintenance compared to planned maintenance. The accepted target ratios should be 70% planned and 30% responsive. This will be hopefully be addressed by the developing corporate landlord approach and implementation of a Maintenance Strategy during 2013/14 which will ensure our limited resources are targeted on priority maintenance needs and in line with corporate priorities.
The Senior Energy Officer has reviewed and updated a previous Energy Policy. This updated document was ratified by Council in December 2012. The current priorities for energy management include:
· Renew existing DEC Certificates and begin to roll out DEC’s for the smaller 500-999m2 premises as laid down in a recent legislation update
· Compliance with the requirements of the Carbon Reduction Commitment (CRC). The Council’s carbon emission from its operational buildings amounted 12,377 tonnes for 2011/2012. The current annual financial liability is approximately £160,000 and will prove an ongoing annual budget pressure. This will provide an incentive to improve efficiency going forward. A strategy to manage the CRC scheme will be developed in conjunction with the Council’s Budget Working Group
· Continued investment in energy saving technologies utilising the Energy Invest to Save budget, or use of external funding where appropriate
· Development of the TEAM Sigma energy monitoring and targeting software to allow greater depth of data analysis, increased reporting capabilities and more effective identification of areas of inefficiency
Regeneration
A key issue is the extent to which the physical distribution of Council assets can support the regeneration objective, and the need to balance this with the requirement to achieve revenue savings and capital receipts through asset rationalisation. Major regeneration projects are focusing on town centre regeneration, economic development, environmental improvements, communications and transport. Specific projects include:-
a) The Works Regeneration Project
“The Works” is a long term development securing private and public sector funding to reclaim the former Corus steelworks site in Ebbw Vale. Since 2012 the Energy Centre, The Blaenau Gwent Learning Zone and Ebbw Fawr Learning Community; Primary Phase, Pen-y-Cwm Special School and the Integrated Children Centre (ICC) and the multi-story car park have been completed which is a significant achievement. A new Leisure Centre and the Ebbw Fawr Learning Community; Secondary Phase are scheduled to open in September 2013. The intention is to link with the town centre and pursue residential development opportunities on the site and on the northern approach to Ebbw Vale. Funding has recently being confirmed to extend the Ebbw Vale railway line to the site. Work is ongoing to scope the potential for the development of a “public sector hub” on the site and further detail is provided below.
b) Enterprise Zone Development and the Northern Corridor
The designation of the Enterprise Zone in Ebbw Vale will assist the attraction of investment to the Heads of the Valleys Road Corridor and Ebbw Vale Northern Corridor and create job opportunities. Work is ongoing to consider opportunities for a more holistic private:public partnership approach to bringing forward development opportunities within the Corridor rather than considering sites in isolation. This work is being funded by Welsh Government through the National Assets Working Group (NAWG).
c) Town Centre Regeneration Activity
Work is ongoing in Abertillery and Ebbw Vale to implement a range of town centre projects with funding secured from the European Convergence fund. Ensuring the vibrancy of town centres is an important regeneration objective and funding is being sought to implement a regeneration programme in Tredegar. Feasibility work is ongoing in respect of a new community hub building in Abertillery and funding has been secured. Community asset transfer opportunities are being considered for key office buildings in town centres including Abertillery District Office and Worcester Street, Brynmawr.
d) Racetrack of Wales
Work is well advanced on the attraction of investment to secure the development ofa new international motorcycle racetrack at Rassau, Ebbw Vale. If this project is implemented there will be significant job opportunities in the area.
e) Relocation of the Vocational Training Centre
The existing Training Centre in Tafarnaubach, Tredegar is not fit for purpose in terms of suitability and condition. An outline business case is being prepared to assess options for re-location. The Regeneration staff located in the building will be re-located to the Civic Centre/Bridge Street with the rest of the Directorate as part of the Workplace Transformation programme. This will result in the existing site becoming surplus to requirements with the potential for sale and/or redevelopment.
3.3 Education and Leisure Directorate
The schools portfolio continues to go through a period of transformation. The Estyn Inspection of 2013 concluded that the Education services for children and young people are unsatisfactory because standards of attainment are unsatisfactory, particularly in secondary schools. The Council is reviewing a Transformation of Education in Blaenau Gwent strategy to achieve significant improvement in attainment and achievement levels.A formal consultation process on the 21st Century Schools programme has been concluded, focussing on primary school reorganisation. Should all of these proposals be implemented, this will result in the closure of three primary schools.