Agenda item

A report of the Head of Financial Services.

The Head of Financial Services submitted a report reviewing the Treasury Management Strategy and the Annual Investment Strategy, plus the various Prudential Borrowing and Treasury Indicators for the first six months of 2021/22.  (Item 5 on the agenda filed with these minutes).

The Head of Financial Services attended the meeting to assist the Committee

with the consideration of this item and informed them as follows:

·         The general fund was underspent by £36million.

·         There had been £28million worth of borrowing for the enterprise zone and regeneration.

·         There had been £2.5million slippage on budgets in Period 4.  However here was still a balance underspend of £5.5million.  The variance would be detailed in a report to Cabinet on 9^th December 2021.

·         It was envisaged that the budgets for the enterprise zone and regeneration budgets elements of the Capital Plan would continue, and be rolled forward into future years.

·         The average level of funds available for investment purpose during the first half year was £39million.  The Council investments were currently outperforming the London Interbank Bid Rate benchmark with a return of 0.18%.  This was lower than the previous financial year, but it was still making the best investments possible whilst operating with security.

·         There were £5million of external property funds, and there was a net return of 92.5% after management fees.

·         No borrowing was currently planned.  The new Capital Plan would blend capital strategy.

The Committee were advised in response to questions that:

·         There was a typographical error on page 22 of the reports pack.  The figures in the table were meant to be in thousands rather than millions.

·         With regard to the funding of Bedford Square, the Council had been due to receive £1.7million in Town Deal money, but this had not been received as yet.  As such, the figures referred to Council money spent that would eventually be offset by the Town Deal money once it was received.  There would also be some external funding schemes from the Business Rates Pilot and as such the actual overspend would be lower than the figures presented.

·         Regarding the Shepshed Bullring project, there was a fixed amount available for it from the Town Deal, however, to complete delivery additional external funding would be needed.

The Chair noted that it was good that the Council were keeping within limits.  She further noted that the figures from the Link Group had been recently updated for the latter period given the uncertainties around interest rates.

RESOLVED that the Committee notes this mid-year review of the Treasury Management Strategy Statement, Prudential Borrowing and Treasury Indicators plus the Annual Investment Strategy.

Reason

To ensure that the Council’s governance and management procedures for Treasury Management reflect best practice and comply with the Revised CIPFA Treasury Management in the Public Services Code of Practice, Guidance Notes and Treasury Management Policy Statement, that funding of capital expenditure is taken within the totality of the Council’s financial position, and that borrowing and investment is only carried out with proper regard to the Prudential Code for Capital Finance in Local Authorities.