Item 1

Policy and Resources Committee: 22 September 2026

Capital Expenditure Outturn

Report by Head of Finance.

1. Overview

1.1

This report presents the expenditure outturn position as at 31 March 2026 in respect of the approved General Fund and Non-General Fund capital programmes for financial year 2025/26, for information.

1.2

To demonstrate a focus on maintaining existing assets of the Council and ensuring that our buildings and infrastructure are maintained at levels expected by the Orkney public, and that our IT, plant and vehicles achieve modern standards of security, safety and emissions, annual capital improvement and replacement programmes of work are agreed by the relevant service Committee or Sub-committee.

1.3

Delivery of these planned programmes of work are thereafter monitored throughout the financial year by the relevant service Committee or Sub-committee.

1.4

For all other capital projects, the Council adopted a Capital Project Appraisal process in order to prioritise projects to be added to the capital programme. The Policy and Resources Committee recommends whether or not individual capital projects that come forward as part of the Capital Project Appraisal process should be added to the capital programme.

1.5

Delivery of the approved capital programmes are thereafter monitored throughout the financial year by the Policy and Resources Committee.

1.6

On 23 September 2025, the Policy and Resources Committee recommended approval of the revised capital programmes for 2025/26, which were updated throughout the year for any exceptional items added through delegated authority, or Committee approval, where required.

1.7

The capital expenditure monitoring report presented to the Policy and Resources Committee on 17 February 2026 advised that the existing capital programme, in respect of both the General Fund and Non-General Fund, had been re-profiled in order to reflect slippage and current timescales for completion of individual projects. That exercise resulted in £14,211,000 being re-profiled from financial year 2025/26 to the following financial year and onwards.

1.8

The table below provides an overview of the expenditure incurred in financial year 2025/26 across both General Fund and Non-General Fund capital programmes.

1.9

Appendix 1 to this report provides a detailed analysis of capital expenditure, together with project updates received from the Services in respect of the General Fund and Non-General Fund capital programmes.

IMAGE: The report cover shows the Orkney Islands Council crest and the title “Capital Expenditure Outturn”, identifying the report as an Orkney Islands Council committee document.

2. Recommendations

It is recommended that members of the Committee:

1. Note the summary outturn position of expenditure incurred for financial year 2025/26 in respect of the General Fund and Non-General Fund capital programmes, as detailed in section 1.8 of this report.

2. Note the detailed analysis of expenditure figures and project updates in respect of the approved General Fund and Non-General Fund capital programmes for 2025/26, attached as Appendix 1 to this report.

For Further Information please contact

Shonagh Merriman, Service Manager (Corporate Finance), extension 2105, Email shonagh.merriman@orkney.gov.uk

Implications of Report

1. Financial

The Financial Regulations state that approval by the Council of the Capital Programme constitutes approval of the individual projects or provisions contained therein. Directors can incur expenditure within approved revenue and capital budgets. Such expenditure must be in accordance with the Council’s policies and objectives and subject to compliance with the Financial Regulations.

2. Legal

Regular financial monitoring and reporting helps the Council meet its statutory obligation to secure best value.

3. Corporate Governance

In terms of the Scheme of Administration, the monitoring of the levels of capital expenditure incurred against approved budgets within the General and Non-General Fund capital programmes is referred to the Policy and Resources Committee.

4. Human Resources

N/A

5. Equalities

Equality Impact Assessment is not required for financial monitoring.

6. Island Communities Impact

Island Communities Impact Assessment is not required for financial monitoring.

7. Links to Council Plan

The proposals in this report support and contribute to improved outcomes for communities as outlined in the following Council Plan strategic priorities:

• ☒ Growing our economy.
• ☒ Strengthening our communities.
• ☒ Developing our Infrastructure.
• ☐ Transforming our Council.

8. Links to Local Outcomes Improvement Plan

The proposals in this report support and contribute to improved outcomes for communities as outlined in the following Local Outcomes Improvement Plan priorities:

• ☐ Cost of Living.
• ☒ Sustainable Development.
• ☐ Local Equality.
• ☐ Improving Population Health.

9. Environmental and Climate Risk

Where resources allow, improvement works can include ‘greener’ solutions.

10. Risk

Improvement of existing assets can help reduce risks associated with these assets.

11. Procurement

Any contractual arrangements require to comply with the Financial Regulations and Contract Standing Orders.

12. Health and Safety

Well-maintained assets will assist the Council in complying with relevant Health and Safety requirements for both staff and the public.

13. Property and Assets

Included throughout the report and detailed in the Appendix.

14. Information Technology

Up to date IT systems should help reduce risk to the Council.

15. Cost of Living

N/A

List of Background Papers

Policy and Resources Committee: 23 September 2025 - Capital Slippage and Acceleration

Appendix

Appendix 1 – Capital Expenditure Outturn as at 31 March 2026.