Issue - meetings

The Portfolio Holder for Corporate Governance, Finance and Resources is to present the Treasury Management Mid-Year Report 2022/23.

Cabinet RECOMMENDED that Council:

1)    Notes the mid-year position on treasury activity for 2022/23;

2)    Notes the mid-year position on the Prudential Indicators for 2022/23, and;

3)    Approves the proposed change to the Investment Strategy as outlined in paragraph 5.2 of the report, to increase the maximum investment period with banks and building societies to three years.

The Director for Corporate Services, Mrs Dawn Garton, introduced the report, which provided a summary of the Treasury activities until the end of September 2022including the actual position to date on the Prudential Indicators.

The Director said that there have been challenges for a number of years in terms of maximising investment returns, but that we are now seeing much higher interest rates this has helped to mitigate overspends.  These higher rates are expected to continue to rise presenting further opportunities to maximise returns. In light of this, Cabinet are asked to amend the investment criteria from investments only being allowed to be placed with banks for up to 12 months to allow investments to be placed for a maximum of 3 years. This will allow a higher rate of return whilst always keeping in mind the balance between security, liquidity and yield.

In moving the recommendations, the Portfolio Holder for Corporate Governance, Finance and Resources, Councillor Ronnie de Burle, said that the Finance Team have done an excellent job in maximising investment income.

Councillor Graham commented about the increase in interest rates that are favourable and was in favour of increasing the time the Council’s investments are placed.

The Leader commented on rising interest rates being offset against inflation and stated that he was also in favour of longer-term investments.

Cabinet RECOMMENDED that Council:

1)    Notes the mid-year position on treasury activity for 2022/23;

2)    Notes the mid-year position on the Prudential Indicators for 2022/23, and;

3)    Approves the proposed change to the Investment Strategy as outlined in paragraph 5.2 of the report, to increase the maximum investment period with banks and building societies to three years.

Reason for Recommendations:

The Treasury Management Code requires the Council to provide a mid-year update on Treasury Management activities to the Council. It is a requirement that Treasury Management performance is scrutinised during the year prior to consideration by the Council which falls within Cabinet’s remit.

To facilitate the decision-making process and support capital investment decisions the Prudential Code requires the Council to agree and monitor a minimum number of prudential indicators.