Issue - meetings

This report sets out the monitoring of the Council’s Treasury Management function for the period 1 April 2024 to 31 March 2025.

A deficit of £2.1m was the final position as the Council continues to borrow to fund the accumulating deficit on its Dedicated Schools Grant (DSG). Borrowing is also at higher-than-expected interest rates due to volatility in current debt costs.

The report also sets out the Quarter One performance for 2024/25 which forecasts an underspend of £0.3m due to the Councils ability to borrow in the local authority market at lower than budgeted interest rate.

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

The Assistant CFO referred to the economic background to the report and updated on the latest position regarding the Bank of England base rate. The report set out the monitoring of the Council’s Treasury Management function for the period 1 April 2024 to 31 March 2025. A deficit of £2.1m was the final position as the Council continued to borrow to fund the accumulating deficit on its Dedicated Schools Grant (DSG). Borrowing was also at higher-than-expected interest rates due to volatility in current debt costs. The report also set out the Quarter One performance for 2024/25 which forecast an underspend of £0.3m due to the Council’s ability to borrow in the local authority market at lower than budgeted interest rate. The Assistant CFO advised that a Treasury focussed training session for committee members was being arranged in consultation with the Chair.

The Assistant CFO was asked about the reason for the growing differential between base rate and PWLR rate and whether this was likely to narrow in the foreseeable future. He explained that Government debt was currently seen by the market as more risky than the bank rate. The forecast set out in the report assumed that the PWLR rate would fall over the medium term but at present the Council continued with its policy of short term borrowing.

RESOLVED that:

(a)  the Committee notes the reported activity of the Treasury Management function for 2024/25

(b)  the Committee notes the reported activity of the Treasury Management function for April to June 2025

Voting: Agreed with no dissent