Build the maintenance budget from the work programme

In November the finance business partner asks for next year’s maintenance budget, and what goes back is this year’s actuals plus four per cent. The review returns a six per cent reduction with no instruction about what to stop doing (figures illustrative). Because the submission never said which work the money bought, the reduction lands on the work the crews reach last: condition routes on non-critical plant, the second annual visit on a duplicated asset, small corrective jobs already ageing in the backlog. By March the deferral is real and no named person accepted the risk.

A maintenance budget built from the work programme behaves differently in that review. Every line has a source the finance director can interrogate, and a reduction has to be applied to a named line by a named person. The build takes the maintenance plan, the statutory calendar and three years of actuals, and costs them.

The maintenance budget has five lines and one forecast

Budget line	Where the number comes from	What moves it year on year
Preventive and routine work	PM forecast from the CMMS, costed from the job plan behind each PM	Frequency changes, asset population, strategy revision
Statutory and safety-critical work	Inspection calendar, written schemes of examination, competent person contracts	Plant entering or leaving service, legislative change
Corrective allowance	Three financial years of corrective actuals by asset class	Reliability work that retires repeat failures, new plant in warranty
Contracted services	Contract schedules, call-off rates, renewal dates	Renewal pricing, scope moved between contractor and direct labour
Deferral carry	Named deferral list with review dates, zero by default	Work declined at the previous review and not yet retired

Only the first line is a forecast, and most operators already hold it. In IBM Maximo Manage, the Generate Forecast action in the Preventive Maintenance application, or the PM Forecast cron task, produces the dated PM population across a forward horizon from the frequency criteria on each PM record. The planner gets a month-by-month count of PM work orders due next year before a single one is generated.

Each forecast PM inherits a job plan carrying labour hours by craft and the material lines the task consumes, which converts the schedule into hours by month and by crew, and material spend by store. Where those estimates were loaded once and never revisited, the costing comes instead from actuals on the last three occurrences of the same PM.

The corrective allowance is an evidence line

Finance challenges the corrective line first, because a contingency with no basis invites a haircut. Build it from history: three financial years of corrective work orders by asset class, split between reactive breakdown work and planned corrective work raised from inspection or condition routes, expressed as hours and spend per asset per year.

Two adjustments turn that average into a forecast. Failures a reliability programme has since retired come out asset by asset, with the reliability engineer named against each reduction, which is where a bad actor programme shows up as money rather than as a slide. Plant commissioned in the year goes in at a lower rate while it sits inside warranty, with the date the rate steps up recorded.

The same history settles the revenue and capital split. Work that replaces an asset like for like sits on the revenue line; work that improves condition or extends usable life sits on capital. That classification costs least when capitalisation is decided while the work order is open rather than reconstructed at year end.

Statutory dates take the first call on capacity

Statutory inspections, thorough examinations of lifting equipment, pressure system examinations under a written scheme and the competent person visits that support them carry dates fixed outside the budget process. They enter the submission as a calendar with a cost per visit, ahead of everything that competes on criticality.

Statutory work plus reactive repair can absorb the whole line. The National Audit Office found that pattern across government property: funding constraints can prevent organisations from focusing on preventive maintenance, which typically delivers the best long-term value for money, because limited funds remain once reactive repairs and the works needed to keep operations running and meet statutory duties have been carried out. Preventive work looks like the discretionary line and is the one that holds the other two down over five years.

A reduction is taken as named deferrals

When the allocation comes back below the submission, the gap has to be written down as work, not absorbed as efficiency. A deferral register does that in six fields: the PM or work order number, the asset and its criticality rating, the consequence of not doing the work, the risk accepted, the person who accepted it, and the date the decision is reviewed. A line with no accepting name is unplanned backlog carrying a budget code.

In its Spending Review 2020 case, the Department for Education recommended £5.3 billion a year of capital funding to maintain schools and mitigate the most serious risks of building failure once its School Rebuilding Programme had expanded, requested an average of £4 billion a year for 2021 to 2025, and was allocated an average of £3.1 billion. The National Audit Office put the government-wide maintenance backlog at £49 billion or more in January 2025, around 4 per cent of central government expenditure in 2023-24, and recorded that a standardised method for calculating that backlog across government was still outstanding. An operator that cannot state what its own backlog figure includes argues the number instead of acting on it. The definition belongs in the backlog governance rules, applied consistently enough to compare two consecutive years.

Variance is reviewed by work type each period

A single maintenance cost line gives a monthly review nothing to act on. The view that works is planned against actual by work type: preventive, statutory, planned corrective, reactive, contracted. A reactive line running 20 per cent above plan while preventive runs 15 per cent below is a reliability signal in a finance pack (figures illustrative), and it disappears when both sit in one total.

Maximo Manage carries this in the Budget Monitoring application, where budget records monitor transactions within a financial period. The cost structure underneath decides whether the output is readable: GL accounts or cost centres that separate work type and asset class, not only site and department. ISO/TS 55010 gives guidance on exactly this alignment between financial and non-financial asset management functions, so cost, risk and performance are balanced on the same data.

What stays hard

Job plan estimates are the binding constraint. A library where labour hours were loaded at implementation and never re-estimated produces a forecast that is precise and wrong, and re-estimating the two hundred job plans carrying most of the PM volume is weeks of planner time nobody has budgeted.

Three years of corrective actuals include work that should never have recurred, and separating that from genuine wear needs failure coding the estate may not have been capturing. Where the codes are thin, the allowance is defensible at asset class level and no finer.

The budget calendar does not wait for data remediation, so the first build is usually partial: a solid PM forecast line, a corrective allowance covering the asset classes with usable history, and a stated share of total spend evidenced at line level. That share sets the target for the following year. The deferral register is also the artefact most likely to be dropped, because it moves risk ownership to the people who set the allocation.

The position

A maintenance budget defended at line level changes what a cut means. A percentage applied to a total becomes a list of work somebody declines in writing, against named assets with known criticality. Operators who submit on that basis argue scope in November, while the schedule can still absorb the answer, instead of discovering it in March on whichever assets the crews reached last.

The artefact to take into the next review is the deferral register, with accepting names and review dates filled in. Any line the finance director declines to sign is a line that gets funded.