Issue - meetings

Treasury Management Policy and Strategy 2023-24

Meeting: 22/02/2023 - Council (Item 11)

11 Treasury Management Policy and Strategy 2023-24 (Agenda item 11) pdf icon PDF 249 KB

Report of Councillor Phil Cowen, Executive Member for Finance, Revenue & Benefits.

Additional documents:


Councillor Cowen, the Executive Member for Finance, Revenue & Benefits presented the report.


The Council was obliged to review and agree its Treasury Management Strategy each year and reflect any changes that might be required as a consequence of guidance received from the Chartered Institute of Public Finance & Accountancy (CIPFA.  He advised that the CIPFA guidance was not actually ‘guidance but a requirement placed upon authorities.


The report outlined the Council’s Prudential Indicators for 2023-24 to 2025-26 and set out the expected treasury operations for this period and approval was being requested for the Treasury Management Policy, Strategy and Prudential Indicators for 2023-24 to 2025-26.


Councillor Birt asked if the low cost of the funding provided by the Public Loans Works Board (PLWB) could be investigated further to assist with the Council’s carbon reduction plans. He pointed out that the charges on these loans were lower than inflation and such loans could help to assist with the Council’s vision to be carbon neutral by 2035.


Councillor Cowen understood exactly what Councillor Birt was saying but Alison Chubbock, the Assistant Director of Finance & S151 Officer would, if asked, advise Members of the rules and regulations of local authority borrowing.


Councillor Kybird pointed out that this matter had been discussed at the Governance & Audit Committee meeting and in regard to PLWB, this Council did not have a need for external funding as the net borrowing requirement could be met through its own resources.


Councillor Cowen then read aloud and proposed the four recommendations which were seconded by Councillor Kybird.


Following a vote which was unanimous, it was:




1)         the Treasury Management Strategy 2023-24 to 2025-26 at Appendix A be approved;


2)         the Minimum Revenue Provision (MRP) statement contained within Appendix A which sets out the Council’s policy on MRP be approved;


3)         the Prudential & Local Indicators and limits contained within Appendix A (Tables 1-11) be approved;


4)         the Investment Strategy 2023-24 (Appendix B) and the detailed criteria included in Appendix B1 be approved; and


5)      the Treasury Management Policy at Appendix B2 be approved.


Meeting: 02/02/2023 - Governance and Audit Committee (Item 11)

11 Treasury Management Policy and Strategy 2023-24 (Agenda item 11) pdf icon PDF 249 KB

Report of Councillor Phil Cowen, Executive Member for Finance, Revenues & Benefits.

Additional documents:


The Chairman pointed out that under this item there was an appendix that was private & confidential and if Members wished to discuss this in more detail, a vote would have to be taken to go below the line and would be taken as the last item on the agenda.


It was agreed that no discussion was required in terms of the private & confidential appendix and the meeting remained in public session.


The Executive Member for Finance, Revenue & Benefits introduced the report. This report was for Members to recommend to Full Council and it outlined the Council’s prudential indicators for 2023/24 and 2025/26.  Item 1 of the report provided the background and identified why the Council was doing this, why it had to do it and the procedures subsequently identified how the Council had gone about it.  He asked Members to note the key elements of the Prudential Code that had to be addressed and most importantly, at section 1.3, it confirmed that a balanced budget had to be produced.


The Accountancy Manager then presented the report.  The report contained relatively few changes since July 2022 when Members last considered the Treasury Management Policy and Strategy.


The main changes were highlighted.


The maximum amount that the Council could invest in secure counterparties for up to one year or more was currently £7.5m but was now being recommended that where these secure counterparties were non-UK banks, the Country limit set at £5m for all investments, should be raised to £7.5m to ensure consistency of investments.


The Council was still not expecting to borrow externally over this time period but borrowing internally would be required to fund the Capital Programme and would be repaid overtime.


The table on page 94 of the agenda pack that the returns on the Council’s investments for next year would be just over 6% in terms of the Council’s revenue stream due to the level of interest rates.


Attention was then drawn to page 99 of the agenda pack, where based on the estimates in the report and the 10 year capital programme, a liability benchmark had been developed to cover the next 10 years. The dotted red line was the key line to note as this was the liability benchmark which was negative for the next 10 years and the reason for this was that the investments were expected to exceed the Council’s external borrowing.


Mr Fowler, the Independent Lay Advisor referred to table 2 on page 90 of the agenda pack and asked why there was such a leap in the capital receipts and reserves column from this year to next.


Members were informed that the Council current had a major asset sale that was expected to happen at some point in 2023/24.  The Chairman stated that the key here was that this was only an estimate.


Councillor Birt referred to page 131 of the agenda pack, the interest rate forecast. He was aware that there had been some huge changes in this forecast compared to  ...  view the full minutes text for item 11