Issue - meetings

To consider and decide on the recommendations as set out in the attached report.

RESOLVED – That Full Council be recommended that the Treasury Management Policy and Strategy 2020/21, as set out in Appendix A to the report, be adopted.

REASON FOR DECISION:

The security of the Council’s cash and effective cash flow management is vital in order to support all the services provided by the Council.  The interest received from the Council’s investments is an important sources of income in helping the Council set a balanced budget.

Lee Colyer, Director of Finance, Policy and Development introduced the Report that set out the Council’s policies for managing investments and borrowing. Discussion and responses to Members questions included the following matters.

-       The Chartered Institute for Public Finance and Accountancy (CIPFA) as part of the Treasury Management Code required local authorities to produce a Treasury Management and Policy Strategy.

-       The Report was a key financial document that set out the Council’s approach to its management of its Treasury management functions.

RESOLVED – That Full Council be recommended that the Treasury Management Policy and Strategy 2020/21, as set out in Appendix A to the report, be adopted.

REASON FOR DECISION:

The security of the Council’s cash and effective cash flow management is vital in order to support all the services provided by the Council.  The interest received from the Council’s investments is an important sources of income in helping the Council set a balanced budget.

To consider and provide a recommendation to Cabinet on the proposals set out in the attached Report. 

Lee Colyer, Director of Finance, Policy and Development introduced the Report that set out the Council’s policies for managing investments and borrowing.  Discussion and responses to Members questions included the following matters.

-       The Chartered Institute for Public Finance and Accountancy (CIPFA) as part of the Treasury Management Code required local authorities to produce a Treasury Management Policy and Strategy.

-       This was a key financial document that set out the Council’s approach to its management of its Treasury management functions. 

-       The Government’s decision to add a further 1% profit margin to the Public Works Loan Board (PWLB) rates was made by Treasury and was done without any consultation.  It was understood that the decision was taken in order to take some of the heat out of local authority borrowing.  However Local Government sector was not asked why borrowing had increased.  It had been suggested that local authorities had been borrowing in order to buy shopping centres.  This was not the case, it was for place shaping to support economic development, new housing and funding infrastructure. 

-       The addition of 1% had impacted on a number of Council’s housing schemes and  infrastructure plans. 

-       However, lenders that advised on pension funds and insurance companies  were now more attractive than PWLB.  In addition the Local Government Association were speeding up the Municipal Bonds Agency that would provide competition to the PWLB. 

-       Derivatives were one way of protecting the interest rate where there was a particular need and the timing was known.  The Council would also be able to negotiate with pension insurance companies to arrange a forward fixing of the interest rate.  Depending on the need, the Council would seek advice and consider options to protect against interest rate fluctuations.  Consideration would be done on an individual basis depending on need. 

RESOLVED – That the recommendations to Cabinet as set out in the report be supported.