Issue - meetings

RECOMMENDED to Council that the revised prudential indicators set out in table 10 of the report to the Audit and Governance Committee on 27 July 2023 be approved.

Note – resolutions (a), (b) and (c) were resolved matters by the Audit and Governance Committee

The Chair of the Audit and Governance Committee presented the report on the Treasury Management Monitoring Outturn 2022/23 update for Quarter 1 2023/24 and outlined the recommendations as set out on the agenda.

RESOLVED that the revised prudential indicators set out in table 10 of the report to the Audit and Governance Committee on 27 July 2023 be approved.

Voting: Nem.Con

Note – resolutions (a), (b) and (c) were resolved matters by the Audit and Governance Committee.

This report sets out the monitoring of the Council’s Treasury Management function for the period 1 April 2022 to 31 March 2023.

A surplus of £1.9m has been achieved through a reduced need to carry out temporary borrowing due to high cash balances as well as increasing interest rates earnt on the Councils investments.

In addition, the report also sets out the Quarter One performance for 2023/24 which forecasts an underspend of £665k due to the increase in interest rates.

Further to the standard update the reports seeks approval to decrease our borrowing headroom.

The Assistant Chief Financial Officer presented a report, a copy of which had been circulated to each Member and a copy of which appears as Appendix 'A' to these Minutes in the Minute Book.

It was explained that it was a requirement under the Chartered Institute of Public Finance and Accountancy (CIPFA) Treasury Management Code of Practice that regular monitoring of the Treasury Management function should be reported to Members. Council was required to approve any changes to the prudential indicators based on a recommendation from the Audit and Governance Committee.

The Committee was also informed that a training session for the Committee would be arranged very shortly at a date to be agreed and would include involvement from the Council’s external Treasury Management advisers.

The figures were presented within the context of the national economic background and interest rate projections. The Council’s Treasury management performance was explained in terms of borrowing and investments and including particularly an investments summary as at 31 March 2023.

The report set out the monitoring of the Council’s Treasury Management function for the period 1 April 2022 to 31 March 2023. It was reported that a surplus of £1.9m has been achieved through a reduced need to carry out temporary borrowing due to high cash balances as well as increasing interest rates earnt on the Council’s investments.

In addition, the report also sets out the Quarter 1 performance for 2023/24 which forecast an underspend of £665k due to the increase in interest rates.

Members were reminded that as part of the financial strategy supporting the development of the 2023/24 budget, the Council in November 2022 had approved a revision to its self-imposed debt threshold and the two main drivers for extending the debt threshold at that time were set out.

The current report, however, recommended reduction of the debt threshold to £755m based on the current committed level via the approved capital strategy, plus a 5% variance which equated to approximately £30m. The ‘Revised Treasury Indicators : limits to borrowing activity’ were set out in Table 10 of the report. It was reported that the revised approach would not reduce the ambition of the Council but was intended to strengthen governance and improve the transparency round any new significant business cases although it was noted that extra procedural process may extend the timeline for business case.

The Committee reviewed the schedule of approved capital schemes and known commitments and, in response to questions on specific schemes, assurance was provided that the movements in projects and items on the schedule were kept under constant review and that changes would feature in any future updates to the Committee.

RESOLVED that Audit and Governance Committee

a)    notes the reported activity of the Treasury Management function for 2022/23;

b)    notes the reported activity of the Treasury Management function for April to June of 2023/24;

c)    notes and endorses the update on borrowing set out in paragraph 20 of the report to the Audit and Governance Committee  ...  view the full minutes text for item 8