1. Making a Financial Case: The Loughborough Context ILM Level 5
Asset Management
Fidelma Hannah
Planning Office

2. Loughborough’s planning framework
The Agenda to 4pm today
Loughborough’s planning framework
An overview of University Strategy and underpinning plans
The planning and budgetary cycle
Making a financial case for revenue and capital investment

3. Loughborough’s Planning Framework
University Strategy – Towards 2016
Implementation/Development Plans
Business Plans & Budget

4. University Strategy: Towards 2016
10 year vision for the University produced in 2006 following detailed consultation and discussion
Identifies clear priorities for development of the University
Reviewed in 2009 and 2011
Directly influences investment decisions
Plans for further review in 2013

5. Led by member of Senior Executive Team
Implementation Plans
Identify ways in which key themes of the strategy will be taken forward.
Led by member of Senior Executive Team
Includes annual statement of priorities
Available on the intranet

6. First Stage of Budget Setting Process
Development Plans
New process for 2012/13
First Stage of Budget Setting Process
Prepared by PVCs, DVC, COO and DoF
Informed by discussions in Schools & Sections
Provide a longer term view of developments
Discussed widely in January
Directly influence budget priorities

7. Our Planning Timetable
23 Nov 2012 – Input from Schools & Support Services
Dec 2012 – Development Plan Deadline
Jan 2013 – ALT,SWT & Ops discuss plans
Feb 2013 – Establish budget priorities
Mar 2013 – HEFCE Grant
April- June 2013– Development of business plans, 2013/14 budget and 5 year forecasts
July 2013 – Council approves Budget & 5 year forecasts

8. Establishment of Budget Priorities
Skeleton budget – Jan 2012
Budget priorities discussed by ALT and Ops in February
Factors which will influence this:
Development Plans
HEFCE Grant letter
Five year forecasts including student number forecasts, research income forecasts, etc.
Government & other external policy drivers
Surplus required

9. Based on agreed business plans and support service allocations
Budget for 2013/14
Based on agreed business plans and support service allocations
Includes assumptions about student intakes, staff turnover, research and other sources of income
Linked to five year forecasts submitted to Council and HEFCE
Linked to Capital Framework
Sets framework within which resource requests are considered

10. Longer-term approach to planning and resource allocation
Future Challenges
Longer-term approach to planning and resource allocation
Volatile income streams and greater dependence on student recruitment
Greater pressure on budgets
More emphasis on value for money
Increased student expectations

11. Making a Financial Case for Revenue
Part of budget process
Bids must be aligned to budget priorities
Demonstrate alignment with Strategy
Recognise financial constraints
Demonstrate the options that have been considered-what can you can stop doing or do differently to divert resources to strategic priorities
Identify benefits
Outline risks

12. Making a Financial Case for Capital
Investment in Capital Projects is governed by project approval procedures
Our ability to invest is directly linked to our financial forecasts and the continued generation of surpluses

13. Inclusion of project does not mean that it has been approved.
Capital Framework
Recommended by Operations Committee to Finance Committee and Council as a framework for making decisions on major projects.
Inclusion of project does not mean that it has been approved.
Includes forecast of likely levels of investment
Phasing of projects can change

14. Project Approval Procedures
Staged Process
Applies to all projects including major and minor building projects, IT projects and large collaborative bids
Decisions guided by Capital Planning Framework

15. Stage 1 – Project Initiation
Stages 1 & 2
Stage 1 – Project Initiation
Outline of project, initial cost estimates, PMB and feasibility funding, alignment with strategy
Stage 2 – Option Development & Independent Review
Detailed project proposal, performance measures, business case and financial summary
Independent Review undertaken by EMC for building projects & by special group for other projects – includes lay members of Council

16. Stage 3 - Detailed design, tenders & costs
Stages 3 & 4
Stage 3 - Detailed design, tenders & costs
Under £1M approved by VC
£1-4M approved by VC & Chair of Council
Over £4m requires Council approval
Stage 4 – Project Implementation
Includes post-project review