STRATEGIC ASSET MANAGEMENT PLAN
YEAR 2 REVIEW (2013/14)
July 2014
CONTENTS
Page
1. INTRODUCTION 2
2. STRATEGIC INFLUENCES FOR CHANGE 2
3. SERVICE PRIORITIES AND INFLUENCES – ASSET IMPLICATIONS 5
4. PERFORMANCE MANAGEMENT 13
5. KEY ISSUES IN ASSET MANAGEMENT – LOOKING BACK 20
6. KEY ISSUES IN ASSET MANAGEMENT – LOOKING FORWARD 26
7. CONCLUSION 29
8. APPENDICES
Appendix 1: Asset Management Service Risk Register 2014/15 30
Appendix 2: Annual Action Plan Summary 2013/14 34
Appendix 3: Action Plan 2014/15 38
1. INTRODUCTION
1.1 Purpose and Scope of the Review
The Strategic Asset Management Plan (SAMP) was approved by Council in January 2012. The first review was undertaken in June 2013. The purpose of the review is to 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 2013/14 Annual Action Plan to inform a new Action Plan for 2014/15. A new Service Risk Register (Appendix 1) has been developed to take into account these influences and the progress made during 2013/14. The actions and priorities within the new Action Plan flow from the Risk Register.
2. STRATEGIC INFLUENCES FOR CHANGE 2013 - 2017
2.1 Transforming Blaenau Gwent Programme
The Council continues to face challenging year on year cuts in real terms in Welsh Government revenue grant and unprecedented reductions in general capital funding approvals. The Final Settlement for Local Government in Wales was agreed in December 2013. The real cash decrease for Blaenau Gwent compared to 2013/14 is £5.117m (-4.47%). The final capital allocation is £3.317m, a reduction of -0.87% on 2013/14.
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 challenge of achieving significant savings with reduced resources has necessitated the need for the Council to develop an enhanced approach to the delivery of critical transformation work across all service areas.
A Transforming Blaenau Gwent Programme 2013 – 2017 has been developed with input from Welsh Government Advisors to provide the framework under which the Council will drive its transformation agenda. A Strategic Transformation Team has been established to collate and review all projects across the Council in line with a new corporate Project Management Framework. Price Waterhouse Cooper has been working with the Council to develop Organisation Design Principles and a new Future Operating Model as part of the Transformation Programme. The proposed Organisation Design Principles set out the ambition of the Council and will determine the future organisation. The design principles are not service specific and set out the direction for the whole of the Council. The principles will be refreshed as part of the Council’s annual cycle.
There are three key themes that underpin the transformation programme: Strategic Financial Efficiency Projects; Strategic Improvement Programmes and Strategic Policy Initiatives.
Strategic Financial Efficiency Projects – making the best of our finances
The Transformation Plan sets out plans to deliver savings of £10million in 2014/15, £5 million in 2015/16 and £5 million in 2016/17. The Medium Term Financial Strategy has been revised and will be reviewed twice yearly to improve the Council’s financial planning and take into account changing circumstances. A number of financial efficiency and income generation projects have been identified for the financial year 2014/15. Many of them will have asset implications and further details are provided in Section 3: Service Priorities and Influences.
Strategic Policy Initiatives – delivering to our communities, citizens and customers
A number of key strategic policy initiatives have been identified. A new approach to planning with a broad range of partners in determining the right outcome, right strategic direction and right operating model is being developed to ensure service delivery is more sustainable in the long term having regard to reducing resources. A new Customer Care Strategy aligned to the new operating model will address the customer channel shift and how our customers want to interact with the Council. This will include all elements from enquiry handling through to assessment for service, all access channels and the staff conducting these processes. The Future Operating Model will influence the Council’s requirement for assets as it will determine which services we deliver, how and where we will deliver them. This will also link to a cross-service project to consider how we provide business support and will include all elements of general administration, recording and data entry activity across the Council. The Workplace Transformation programme, managed by the Strategic Asset Management Team, is included as a key initiative to reduce both the number of buildings and our operating costs. The operating model will also influence the design of retained offices and other buildings that may deliver customer facing or shared services.
An assessment of current and future opportunities for collaboration, commissioning and shared services will be undertaken. This will be aligned to the potential concept for a public sector hub in Ebbw Vale, a project managed by the Strategic Asset Management Team as part of the Welsh Government supported collaborative asset management work.
Strategic Improvement Programmes – improving the way we work
This theme includes a new overarching H.R. Strategy and supporting policies. It also includes ensuring our performance reporting to members is more robust and strengthening our scrutiny and decision making. A new Project Management Framework (PMF) has been developed and will be implemented. The PMF aims to provide consistent practice and guidance across the Council to help those involved in projects to deliver successful outcomes. The use of the PMF will ensure that all projects which are undertaken/ completed are subject to the appropriate approval processes and that reviews of the success of these projects is carried out. It will ensure that the asset implications of projects are fully considered, for example revenue as well as capital costs. The PMF will also consider the availability of skills and resources available across the Council, including property, to ensure the project can be delivered. The Framework will address one of the outstanding recommendations from the W.A.O. Buildings Management Audit in 2010:
R4: Develop comprehensive guidance for officers on project management that:
· Stipulates the necessary content of business cases for capital projects, which should include option appraisal, whole-life issues, sustainability and equality issues, and an appropriate risk assessment. The key points of the business case should be reported to decision-makers so that they can make a fully informed decision.
· Includes a clear statement of roles and responsibilities at each stage of the project lifecycle, covering both asset management officers and officers with other roles.
· Provides guidance on managing all stages of a project.
· Includes post-project evaluation to learn and disseminate lessons and good practice.
2.2 The Williams Commission Review on Public Service Governance and Delivery
The report was published in January 2014 and examines all aspects of public service provision in Wales under five themes – complexity; scale and capability; governance, scrutiny and delivery; leadership and culture; and performance and performance management. A three to five year programme of change to implement the recommendations is set out. The most important recommendation in terms of implications for assets is the proposal that the capacity of local authorities is increased by mergers to combat the problems of small scale, and facilitate service integration and partnership working. The report recommends between 10 to 12 new Local Authorities based on merging existing boundaries.
Whilst there are no immediate asset implications arising from the report, one of the potential issues is the impact on large capital projects such as the proposed concept for a Public Sector Hub as our requirement for office accommodation in the medium to long term will depend on the collaborative footprint agreed.
3. SERVICE PRIORITIES AND INFLUENCES – ASSET IMPLICATIONS
The main influences for change and service priorities are detailed below. We have not undertaken service asset management plans. We are a small Authority and the Transforming Blaenau Gwent Plan is a corporate programme moving away from the “silo” approach to service delivery and enable a joined up approach to delivering the high level outcomes in the Corporate Improvement Plan:
· Children and young people’s learning and achievement levels are maximised;
· People and communities are enabled to help themselves
· The living environment is vibrant and attractive
We are instead taking a place based approach to asset management. This will complement the neighbourhood approach to delivering the key themes in the Single Integrated Plan and the Area Review and collaborative asset management work.
3.1 Resources Directorate
The Council’s IT service is no longer working collaboratively with Merthyr CBC. The department is working closing with an integrated team on the Workplace Transformation programme. The Council’s I.T. infrastructure requires an urgent upgrade to:
a) address the current risk of key business applications across the Council failing and;
b) support the Workplace Transformation programme and enable staff to work
agilely from any desk, and away from the office and at home
As part of this work a centralised I.T. budget will be established to ensure a corporate approach is maintained. A Print Strategy has also been developed as one of the financial efficiency projects to reduce our costs in terms of procurement of hardware, consumables and volume of printing. It is intended this will be managed by the Corporate Landlord as part of their facilities management function.
Capital Programme
A report approved by Council in July 2013 proposed a two stage process for agreement of the 2014/15 to 2019/20 capital programme as part of the overall Medium Term Financial Strategy 2013/14 to 2019/20. The report recommended that funding for all of the 21st Century Schools programme (£5.2m for 2014/15) be agreed at Stage 1 and that funding for all other schemes be considered as part of the 2014/15 revenue budget setting process at Stage 2.
Stage 2 of the 2014/15 to 2019/20 capital programme was agreed in December 2013 at £8.12m. It was agreed to fund an additional £2 million of prudential borrowing in order to fund the 6 year programme. The revenue costs associated with the approved proposal have also been factored into the base budget. There are no new builds or major refurbishments programmed other than the 21st Century schools. Future requests for capital projects that are not within the approved capital programme will only be considered if:-
• amounts allocated to approved projects vary in order that funding can be released
to another project
• the level of forecast capital receipts exceeds the anticipated target
• prudential borrowing opportunities arise through the realisation of additional
revenue savings
• slippage funding becomes available for reallocation.
Revenue Savings
As mentioned above, revenue savings of £10m are required for 2014/15. The impact of these savings on assets will be considered in relation to each service below. Savings of £11,433,490 have been identified broken down into sub-headings as follows:
• No change - £0.6m
• Reduction - £3.4m
• Termination - £0.4m
• Transfer to third party - £1m
• Efficiency - £1.8m
• Income generation - £3.1m
• Collaboration - £1.1m
3.2 Environment and Regeneration Directorate
Public Services
A number of financial efficiency projects have been identified within Public Services. The closure of buildings, particularly our offices for Workplace Transformation, will support the downsizing of cleaning staff. The five public toilets closed in November 2013. The closure of the household waste recycling centres at Bourneville and Silent Valley will generate significant revenue savings.
Responsibility for pavilions, park and sports grounds transferred to Public Services on 1st April 2014. Grounds maintenance is an area identified for efficiency savings. This includes reduced grass cutting and maintenance schedules, not providing caretaking services and increasing pitch fees. However, this has led to a significant increase in Community Asset Transfer requests from sporting groups for their pavilions, changing rooms and sports grounds. This is having a significant impact on resources within the Estates and Strategic Asset Management Team. It has also highlighted the need to review the stock of pavilions and changing rooms to determine how best to take forward their future operation and management.
The Council is no longer providing a straying animal (livestock) impounding service. This will enable the disposal of the animal pound at Central Depot during 2014/15.
The tied accommodation in Ebbw Vale and Brynmawr cemeteries along with the houses at the Council’s sports pitches are also under review.
Central Depot has been subject to a major refurbishment to deal with condition and asbestos issues. In terms of office accommodation the priority for Public Services over the short to medium term is to progress with the redevelopment of the former waste and transport offices at Central Depot to allow for agile working. The main offices within the Central Depot together with the welding shop have been declared surplus and will be demolished or sold during 2014/15.
Technical Services
The Corporate Landlord function has been developed for all Council premises excluding Leisure, and a review of the work undertaken to date is included within Section 5: Looking Back. As part of the financial efficiency savings the Property Maintenance team has downsized, losing two Principal Officers and backfilling with a junior post. This has been challenging given the current workload:
· Supporting the transfer of assets to the new Life Leisure Trust and commissioning condition surveys of all the buildings affected
· Provision of architectural and building services to several external clients including Merthyr Tydfil CBC, Monmouthshire CBC and Torfaen CBC. Projects include a new school and regeneration works
· BGCBC projects including major regeneration work in Abertillery, Flying Start accommodation, and refurbishment of Civic Centre and Anvil Court for the Workplace Transformation project