Grand design, but is 'creaking' plan up to the job?

IT WAS put in place at the end of last year, yet already there are signs that something is amiss with the capital programme. Treasury minister Charles Parkinson said at the last States meeting that it was almost certain the plan, which outlines timings and costs of major projects such as Les Beaucamps High and mental health facilities, needed to come back to the States.

He warned that in some places it was 'creaking at the seams'.

Treasury is currently remodelling the programme and it will consider what to do at a board meeting.

So what has changed? Will there need to be delays and could there be room for projects that were not even on the horizon last year?

Although it was never listed among the 18 projects set to go ahead up until 2014, the scrapping of the proposed Suez waste plant could have an impact here.

Its £93.5m. was going to be financed by an internal loan from Treasury to be paid back through gate fees, so never made it onto the capital list.

With that all on the backburner the cash flow situation has changed, according to deputy Treasury minister Jack Honeybill.

'There's lots of issues debated recently that have implications on the capital programme, the fact that Suez was kicked out has created a different set of priorities, that's why Deputy Parkinson said we had to revisit it,' he said.

The capital issue only came to light as debate heated up on where to house the Roman wreck Asterix.

One of the projects that now needs to be fitted into the programme is a new slaughterhouse, which, because the current one does not meet health and safety standards, needs to be replaced by 2012.

Its current location is seen as a possible home for Asterix, although at an unknown cost, and the new slaughterhouse was in the past expected to cost in the region of £1m.

That is the same amount earmarked for the Sarnia workboat, which will only go ahead if a survey proves it necessary – no word on that yet.

'We need to look at what safely we could perhaps push up the priority list bearing in mind we have so many good causes,' said Deputy Honeybill.

He suggested that the new slaughterhouse should be a priority – with improved facilities comes the possibility of selling more beef that is currently unable to enter the food chain.

There is another elephant in the room – that of the proposed deal for Aurigny.

If the sale to Blue Islands was to go ahead, that would mean paying off some £6.4m. in loans – a substantial burden that was meant to be delayed until 2014.

A quick analysis of the whole programme's timings, revised because of the successful anti-borrowing amendment, could suggest it was something of a fantasy in the first place.

Had it been accurate, work would be well under way on projects including Les Beaucamps, new mental health facilities, even the runway upgrade. None have been back for the final green light.

It could mean Treasury having to adapt the timings again so that the money is available – even in its last States report on the issue it warned: 'the department will closely monitor the balance of the capital reserve and will update the modelling included within this States report each time one of the projects is brought forward for a capital vote to be opened. The department will append the updated model to its letter of comment on the report and this may result in a recommendation to the States to delay the project should the balance in the reserve prove to be insufficient'.

And what of the extra money needed under the anti-borrowing plan championed by Deputy Matt Fallaize et al?

It required some £1.775m. more to be generated by the ports holding account.

We heard warnings at the end of last year that it was not projected to perform as well as previously.

No proposals have been released for public consumption yet, although there is a suggestion harbour users might bear the brunt.

The lesson from the successive reports detailing the capital programme was the need for regular review.

The original estimate for the airport radar grew by £1.1m. between a few sittings of the States, the homes for adults with learning difficulties by £300,000.

With these kind of conflicting pressures all roads lead to Treasury being back to the States with a capital prioritisation report within the next year.

And there may need to be another area explored.

Deputy Fallaize said the funding model put together by the group he led was capable of carrying out all the priority projects.

'But there was always an acceptance that the States would have to decide whether to invest the same, less or more on capital projects,' he said.

At the moment £20m. at 2007 levels is appropriated into the capital reserve from general revenue each year.

It may be any report that revisits the programme may prompt a rethink on that as well.