-
Issue - meetings
Treasury Management and Annual Investment Strategy 2018/19
Meeting: 12/02/2018 - Cabinet (Item 65)
65 Treasury Management and Annual Investment Strategy 2018/19 PDF 478 KB
(Council Decision)
Minutes:
The Assistant Director, Financial Services and Revenues, presented a report on the treasury management and annual investment Strategy for 2018/19. The strategy provides a framework for the management of the council’s investments, cash flow and borrowing activities. The council’s treasury management practices have been revised to take account of changes in the Chartered Institute of Public Finance and Accountancy (CIPFA) codes of practice.
The council operates a balanced budget, which broadly means that cash raised will meet cash expenditure. Part of the treasury management operation is to ensure that this cash flow is adequately planned, with cash being available when it is needed. The capital plans provide a guide to the borrowing needs of the council. This management of longer term cash may involve arranging long or short term loans, or using longer term cash flow surpluses, and on occasion any debt previously drawn may be restructured to meet council risk or cost objectives.
Councillor Chowney proposed approval of the recommendations to the report, which was seconded by Councillor Forward.
RESOLVED (6 votes for, 2 votes against) that:
1. The council adopts the new CIPFA Treasury Management Code of Practice (2017).
2. Council formally adopts, as part of the Council’s Constitution and financial rules the four clauses recommended by the Code of Practice as detailed in Appendix 8.
3. The Council approve the Treasury Management Strategy, Minimum Revenue Provision (MRP) Policy, Annual Investment Strategy, and that a Capital Strategy is developed for 2019/20
4. That the strategies continue to be reviewed in 2018/19 in the light of the requirements of the new Codes of Practice and that the Financial rules and Financial Operating Procedures of the Council are reviewed and amendments proposed as necessary.
5. That the authorised limit for external debt is increased by £10m to allow for short term borrowing for cash flow purposes at year end in particular.
The reason for this decision was:
The council seeks to minimise the costs of borrowing and maximise investment income whilst ensuring the security of its investments. The Council is seeking to increase opportunities for income generation, particularly where there are benefits to the residents of Hastings in doing so, and this will continue to involve the council in taking on additional borrowing. The sums involved are large and the assumptions made play an important part in determining the annual budget. A new CIPFA Code of Practice (2017 Edition) has been released to take account of the more commercialised approach being adopted by councils and the enhanced levels of transparency required. The code represents best practice and helps ensure compliance with statutory requirements.
The council has the ability to diversify its investments and must consider carefully the level of risk against reward against a background of historically low interest rates. Investments can help to close the gap in the budget in the years ahead and thus help to preserve services.
-
My council
Contact
Got a question about democratic services?
Content
The content on this page is the responsibility of our Democratic Services team.