Issue - meetings

The Leader’s Portfolio

To consider report FIN/593 of the Head of Corporate Finance, which was referred to the meeting of the Overview and Scrutiny Commission on 21 November 2022.

RESOLVED

That the Cabinet notes report FIN/593 and the treasury activity for the first two quarters of 2022/2023

Reasons for the Recommendations

The CIPFA (Chartered Institute of Public Finance and Accountancy) Code of Practice for Treasury Management recommends that members be updated on treasury management activities regularly (Treasury Management Strategy, annual and mid-year reports).  This report, therefore, ensures this Council is implementing best practice in accordance with the Code.

The Leader of the Council presented report FIN/593of the Head of Corporate Finance.  The report provided an update on the Council’s Treasury Management Strategy for the first two quarters of 2022/23. The Leader emphasised that the Council had £139m invested at 30 September at an average rate of 0.84%.  It was noted that those rates were lower than our comparators, but that was because the Council had invested for longer terms which had given better returns in the past, but as those deals mature, they would be replaced with investments at higher rates. It was noted that the Council prioritises its investments as security of capital, liquidity, yield and ethical.

In the capital programme there was a budget of £60,000 for further solar PV installations and other climate change related works, under the new budget title of “Climate Change Initiatives”.

Councillor T Belben presented the Overview and Scrutiny Commission’s comments on the report to the Cabinet following consideration of the matter at its meeting on 21 November 2022 including that the Commission acknowledged that whilst the current returns appears to be low but the finance team had made some very good long term investments which has always better than previous bank rate of 0.25%.

Councillor Crow was invited to speak on this item. Matters raised included that he was disappointed the level of recent investment returns due to the level of interest rates achieved on the Council’s investment. He commented also that he felt that Council might want to consider revising the Ethical investment policy, to allow investment into the armomancy manufacturing, especially in light of Ukraine conflict and how Britain was the second largest military assistance to Ukrainian people.

Councillors C Mullins and S Mullins both spoke as part of the discussion on the report. 

RESOLVED

That the Cabinet notes report FIN/593 and the treasury activity for the first two quarters of 2022/2023

Reasons for the Recommendations

The CIPFA (Chartered Institute of Public Finance and Accountancy) Code of Practice for Treasury Management recommends that members be updated on treasury management activities regularly (Treasury Management Strategy, annual and mid-year reports).  This report, therefore, ensures this Council is implementing best practice in accordance with the Code.

To consider report FIN/593 of the Head of Corporate Finance.

The Commission considered report FIN/593 of the Head of Corporate Finance. The report provided an update on the Council’s Treasury Management Strategy for 2022/23.

During the discussion with the Leader of the Council, Head of Corporate Finance and Chief Accountant, Councillors made the following comments:

·         Acknowledgement that as at 30 September the Council had £139m invested at an average rate of 0.84%.  This was lower than comparators but was due to investing for longer terms which had provided the Council better returns in the past.  As these deals mature, they would be replaced with investments at higher rates.

·         Confirmation sought and obtained on the prudential and treasury indictors, together with the investment performance (Bail-in Exposure).

·         Recognition that one of the holdings showed £5m invested with Slough.  It was confirmed that one of those deals had matured with the other being imminent and there was never any risk to getting the investment back. (Head of Corporate Finance since confirmed that this repayment was made on 21 November).  Any potential further investment would be carefully analysed and considered in future years.

·         Noted that local authority transition from financial stability to the issuing of a S114 notice can be rapid. All investments were carefully analysed and considered as best as possible to ensure compliance with the Council's Treasury Management Practices.

RESOLVED

That the Commission noted the report and requested that the views expressed during the debate, were fed back to the Cabinet through the Commission’s Comment sheet.