The forecast renewal expenditure to 2018 is shown in Table 11. The programme is based on a projection of historic expenditure and judgement of known asset replacements. There is no significant increase in pipeline replacement activity forecast as the current trend in pipeline performance is anticipated to continue. The proposed programme of pipe condition assessment and data analysis may influence future projections. Asset upgrades are included in the capital programme and the costs apportioned between growth, renewal and improved level of service (see Appendix 3 – Capital Budget 2015-18). Renewals 2015 2016 2017 2018 Vested Assets 195,000 195,000 199,875 204,952 Pipelines Renew 233,052 166,900 101,243 97,746 Connections Ren 127,560 127,560 130,634 134,070 Table 11 Forecast Renewal Expenditure 4.5 Creation/Acquisition/Augmentation Plan All capital upgrade projects for the water supply infrastructure follow a process from inception though to construction and commissioning: Identification of Need – new or upgraded infrastructure is identified as necessary for a variety of reasons. Drivers include: as a result of community consultation, higher standards (eg Drinking Water Standards), structural weakness and inability of critical structures to withstand earthquakes and increased growth in demand. Project prioritisation – projects are prioritised through a risk management process of considering the effects of not providing the new or upgraded infrastructure and taking account of budgeting constraints. Upgrades driven by the Drinking Water Standards generally have prescribed time limits which drive the capital works programme. Alternatives and Options – alternative solutions including non-infrastructure solutions are considered before examining different design options Once an outline design solution has been agreed detailed design can proceed. Further options or unforeseen problems maybe encountered at this stage and the decision making process may need to be reviewed. Additional specialist consultancy and, for larger projects peer review, continues through the process. Project Approval – is usually done through the annual plan and LTP processes. Where options are available with significantly different costs and/or risks, those options are typically presented to Council’s Assets and Services (A & S) Committee for consideration. The outline budget costs and the sources of funding are considered during the annual plan process and aligned with the objectives of the Long Term Plan. The decision of the A & S Committee is tabled to the full Council for ratification. Detailed Design – an approved project will progress to detailed design. Specialist engineering consultants are often employed as they have greater experience in the design of major works. Draft designs are submitted to the Planning and Development Engineer and may be passed on for peer review. Generally all engineering works are designed to national or international specifications and standards. The standards may be amended to local conditions. Tender - once a final design has been proposed and agreed with council engineers most construction projects are sent for competitive tender. The Council has a rigorous procurement policy which was recently subjected to scrutiny from independent lawyer following unsupported allegations of corruption. Tender submissions are typically evaluated on the basis of a series of Page 68