Decision details

2020/21 Annual Treasury Management Report

Decision Maker: Overview and Scrutiny Committee

Decision status: For Determination

Is Key decision?: No

Is subject to call in?: No

Purpose:

The attached report reviews treasury performance during 2020/21 against the Council’s Treasury Management Strategy. This is a historic review for noting by members

Decisions:

The 2020/21 Annual Treasury Management Report was presented by the Finance Lead Specialist (Section 151 Officer).  The  report  reviewed  the  treasury  activities  and  the  actual prudential   and   treasury   indicators   for   the   2020/21   financial   year,   meeting   the requirement  of  the  Local  Government  Act  2003,  the  CIPFA  Code  of  Practice  on Treasury Management and the CIPFA Code for Capital Finance in Local Authorities.

 

The  level  of  external  debt  remained  at  £12.8  million,  which  was  below  the  Capital Financing   Requirement   of   £21.1   million,   further   repayment   of   debt   was   not recommended given that the current repayment premium would be high. Attention was drawn  to  the  fact  that the  Council  had not  funded  revenue  activity  through  borrowing, which was a prudent strategy. The borrowing strategy was constantly under review so as to avoid incurring higher borrowing costs in the future.

 

In response to a query from Members, the Finance Lead Specialist (Section 151 Officer) explained that the usage of assets was reviewed annually.

 

Members queried whether the Council could sweat more of its assets. They noted that Lambert Smith Hampton work with the Council on these matters and further queried whether this could be seen by the Committee in more detail.

 

The Finance Lead Specialist (Section 151 Officer) responded by noting one issue with that approach is that councils incur debts to generate income which can lead to fairly large financial ‘black holes’ due to overly commercial activity. At the start of the year service spending, housing, regenerative action and debt for yield can all limit what is possible.

 

Following a question linked to the investments of the Council, the Finance Lead Specialist (Section 151 Officer) informed Members that the investment picture represented the authorities position at the end of the financial year and explained the impact of the COVID-19 grants on investment.

 

RESOLVED – That Council be recommended to approve the 2020/21 Annual Treasury Management Report.

Report author: Claire Read

Publication date: 18/08/2021

Date of decision: 09/07/2021

Decided at meeting: 09/07/2021 - Overview and Scrutiny Committee

Accompanying Documents: