After I refitted the head and the timing gear refitted, this is what the cam looked like with the crank at TDC.

This measures around 8 degrees at the crank pulley
I stripped the timing cover off, the chain pulleys are clearly worn and I ordered a replacement kit from Robsport.
In the meantime, I tried moving the cam pulley over one tooth and this is how it sits now.

This is closer at 5 degrees but still not right
My question is, where do I go from here? Do I need a vernier cam sprocket? Would the new chain and sprockets help to correct this (unlikely).