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Issue - meetings
Treasury Management - Mid Year Report 2017-18
Meeting: 06/11/2017 - Cabinet (Item 44)
44 Treasury Management - Mid Year Report 2017-18 PDF 293 KB
(Council Decision)
Minutes:
The Assistant Director, Financial Services and Revenues, submitted a report to advise Cabinet of the treasury management activities and performance during the current year.
Treasury management relates to the authority’s investments, cash flow, banking, money market and capital transactions. The report provided an update on the economic climate during the first nine months of 2017/18 as well as the council’s current treasury position and strategies for borrowing and investment.
The council complied with the requirements of the Chartered Institute for Public Finance and Accountancy’s Code of Practice for Treasury Management and carried out a mid-year review each year, to provide members with an opportunity to make recommendations to Full Council to address any issues which may have arisen since the original strategy was approved in February 2017. It was expected that Treasury Management Code of Practice (Cipfa) and the Prudential Code for Capital Finance will be revised by the end of the current financial year.
Interest rates had recently increased from 0.25% to 0.50%, and it was expected that further increases would follow in the future.
The council had undertaken additional borrowing over the past year, to help support its income generation activities.
Under rule 13.3 of the council’s constitution, the recommendations of the report were agreed without being called for discussion.
RESOLVED that:
1. Cabinet agree the mid-year report and note that changes to the prudential code, treasury management code of practice and a new capital strategy document are expected to be in place for 2018/19
2. The Audit Committee consider the substantial implications and risks to the council at its meeting in January 2018 when considering the proposed treasury management strategy for 2018/19, with a view to making recommendations to the meetings of Cabinet and Council in February 2018
The reason for this decision was:
The code of practice on treasury management requires, as a minimum, a mid-year review of the treasury management strategy and performance, This is intended to highlight any areas of concern that have arisen since the original strategy was approved (February 2017). It is a requirement of the code of practice that the mid-year review is considered by Cabinet and Full Council.
The council has increased its levels of income generation and this entails new borrowing over potentially long periods, with consequent risks in terms of asset valuations, credit worthiness, cash and reserve fund availability. Such risk cannot be considered in isolation of all the issues facing the council now and potentially in the future.
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