The total amount of capital expenditure incurred in the year is shown in the table below, together with the resources that have been used to finance it. Where capital expenditure is to be financed in future years by charges to revenue as assets are used by the council, the expenditure results in an increase in the Capital Financing Requirement (CFR), a measure of the capital expenditure incurred historically by the council that has yet to be financed. The CFR is analysed in the second part of this note.
| 2024/25 | 2025/26 | |
| Capital Expenditure and Capital Financing | £000's | £000's |
| Opening Capital Financing Requirement | 855,491 | 962,183 |
| Capital Investment: | ||
| Property, Plant and Equipment | 158,287 | 211,491 |
| Property, Plant and Equipment - Finance Leases | 63,580 | 24,064 |
| Property, Plant and Equipment - PFI | 23,844 | 1,300 |
| Intangible Assets | 17 | 152 |
| Long Term Debtor Loans | 4,011 | - |
| Revenue expenditure funded from capital under statute | 13,617 | 11,830 |
| De minimis Capital Expenditure | 741 | 1,012 |
| Finance lease adjustment | (8,650) | (3,868) |
| PFI lease adjustment | - | (104) |
| Sources of finance: | ||
| Capital receipts | (18,319) | (20,150) |
| Government grants and other contributions | (54,258) | (67,606) |
| Major Repairs Reserve | (14,411) | (14,316) |
| Repayment of loan principal | (893) | (526) |
| Sums set aside from revenue: | ||
| Direct revenue contributions | (6,617) | (6,956) |
| Minimum Revenue Provision | (54,257) | (55,044) |
| Closing Capital Financing Requirement | 962,183 | 1,043,462 |
| Explanation of movements in year: | ||
| (Decrease) / Increase in underlying need to borrow (unsupported by Government financial assistance) | 19,268 | 59,287 |
| Assets acquired under finance leases | 63,580 | 24,064 |
| Assets acquired under PFI contracts | 23,844 | (2,072) |
| Increase / (decrease) in Capital Financing Requirement | 106,692 | 81,279 |
As a result of the adoption of the lease accounting standard, IFRS16, on 1 April 2024, the capital investment for property, plant and equipment – finance leases and PFI relate to the revaluation of the lease and PFI liabilities as at 1 April 2024.