Decision Maker: Overview and Scrutiny Committee
Decision status: For Determination
Is Key decision?: No
Is subject to call in?: No
The attached report reviews treasury
performance during 2020/21 against the Council’s Treasury
Management Strategy. This is a historic review for noting by
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