Decision details

Proposed decision:

TheDeputy Leader and Cabinet Member for Finance, Corporate and Traded Services to agree to recommendations to:

1.  note the £28.8 million estimated impact on capital budget spend in the Medium-Term Financial Plan of £339.3 million across the capital programme for 2022-23, were already approved via key decision or covered by appropriate delegated authority to be funded from the options identified;

2.  consider the use of Fluctuation clauses when deemed necessary to control costs to KCC and alleviate adverse effects to the main contractor supplier of the rise in material costs; and

3.  delegate authority to the Director of Infrastructure or the Corporate Director of Growth, Environment and Transport (for Highway Schemes), in consultation with the Corporate Director of Finance and the Deputy Leader and Cabinet Member for Finance, Corporate and Traded Services, to take the necessary actions, including but not limited to entering into contracts and other necessary documentation to enable the delivery of the capital programme taking into account construction and inflation where existing Record of Decisions levels are needed to be adjusted.

Further Information:

The national fiscal and economic context is an important consideration for the Council in setting and managing its revenue and capital budgets.  The budget report to County Council on 10 February 2022 referred to the extraordinary and unexpected challenge to the UK economy and economies across the world arising from the COVID-19 pandemic.  Kent County Council (KCC) has a significant Capital Construction Programme, that has been adversely impacted by the inflationary pressures facing the UK construction industry.

KCC needs to ensure that is has sufficient capital allocated and effective contractual management arrangements in place to deliver the programmes and projects A decision is required to implement these in the time available to avoid disruption to front line services to secure the contractual arrangements for the provision of key infrastructure projects including the provision of school places to meet KCC’s statutory duties. 

As Deputy Leader and Cabinet Member for Finance, Corporate and Traded Services, I agree to:

1. note the £28.8 million estimated impact on capital budget spend in the Medium-Term Financial Plan of £339.3 million across the capital programme for 2022-23, were already approved via key decision or covered by appropriate delegated authority to be funded from the options identified;

2. consider the use of Fluctuation clauses when deemed necessary to control costs to KCC and alleviate adverse effects to the main contractor supplier of the rise in material costs; and

3. delegate authority to the Director of Infrastructure or the Corporate Director of Growth, Environment and Transport (for Highway Schemes), in consultation with the Corporate Director of Finance and the Deputy Leader and Cabinet Member for Finance, Corporate and Traded Services, to take the necessary actions, including but not limited to entering into contracts and other necessary documentation to enable the delivery of the capital programme taking into account construction and inflation where existing Record of Decisions levels are needed to be adjusted.