Issue - meetings

(Finance Portfolio Holder) To consider the attached report.

Mover: Councillor G Mohindra, Finance Portfolio Holder.

Councillor G Mohindra presented a report on the Council’s Treasury Management Strategy, Annual Investment Strategy and the prudential indicators.

Report as first moved ADOPTED

            RESOLVED:

That the following documents attached to these minutes as Appendices 3 and 4 be adopted;

(a)  Treasury Management Strategy Statement 2018/19;

(b)  Minimum Revenue Provision Strategy;

(c)  Treasury Management Prudential Indicators for 2018/19 to 2020/21;

(d)  Rate of interest to be applied to any inter-fund balances; and

(e)  The Treasury Management Policy Statement.

(Director of Resources) To consider the attached report (AGC -018-2017/18).

The Director of Resources presented a report on the Treasury Management Strategy Statement for 2018/19.

The Director reminded the Committee that the annual Treasury Management Strategy Statement report was a requirement of the CIPFA Code of Practice on Treasury Management, and covered the treasury activity for the financial year 2018/19. The risks associated with Treasury Management were highlighted within the report along with how these risks were being managed. The most significant change from the previous Strategy was an increase in the minimum credit rating for counterparties from BBB+ to A-.

In response to queries from the Committee, the Director of Resources stated that the Capital Programme reflected the items that the Council was currently progressing and the figures were expected to improve during the next year as a number of schemes came forward. The operational limit of £250million for the Council’s borrowings had been set by the Council itself; this could be amended to £500million or to a level that was a lot less than the current limit. However, the Council generally looked at the planned expenditure, the borrowing required for this expenditure and then added some contingency to permit the Council to take advantage of any unforeseen opportunities that might arise. The aim was always for the Council to remain prudent.

The Director of Resources acknowledged that the proposed change in ratings for approved counter-parties would remove some banks from the list of financial institutions that the Council could invest with; however, with a balance in the reserves of £30million, this was not expected to cause the Council any real difficulty.

Resolved:

(1)        That the Treasury Management Strategy Statement for 2018/19 represented a continuation of the prudent approach, which had been a consistent theme of the Council’s Treasury Management function for a number of years, be noted;

(2)        That the arrangements for dealing with the risks associated with its Treasury Management activity, as outlined in the Council’s proposed Treasury Management Strategy Statement for 2018/19, be considered adequate; and

Recommended:

(3)        That the proposed Treasury Management Strategy Statement for 2018/19 be recommended to the Council for approval and adoption.

(Finance Portoflio Holder) To consider the attached report (C-045-2017/18).

(1)        That the following be recommended to the Council for approval:

            (a)        Treasury Management Strategy Statement 2018/19;

            (b)        Minimum Revenue Provision (MRP) Strategy;

            (c)        Treasury Management Prudential Indicators for 2018/19 to 2020/21;

            (d)        The rate of interest to be applied to any inter-fund balances; and

            (e)        Treasury Management Policy Statement.

The Finance Portfolio Holder presented a report on the Treasury Management Strategy Statement for 2018/19.

The Portfolio Holder stated that the Council was required to approve the Treasury Management Strategy and Prudential Indicators and a statement on the Minimum Revenue Provision (MRP) before the start of each financial year. The Strategies would also be scrutinised by the Audit and Governance Committee on 5 February 2018 and an update would be provided to Council on 22 February 2018 to cover any suggestions or proposed amendments.

Decision:

(1)        That the following be recommended to the Council for approval:

            (a)        Treasury Management Strategy Statement 2018/19;

            (b)        Minimum Revenue Provision (MRP) Strategy;

            (c)        Treasury Management Prudential Indicators for 2018/19 to 2020/21;

            (d)        The rate of interest to be applied to any inter-fund balances; and

            (e)        Treasury Management Policy Statement.

Reasons for Decision:

To ensure that the Council complied with the Chartered Institute of Public Finance & Accountancy (CIPFA) Code of Practice on Treasury Management.

Other Options Considered and Rejected:

To request additional information regarding the Treasury Management Strategy Statement or determine that additional indicators were required.