Issue - meetings

Treasury risk management at the Authority is conducted within the framework of the CIPFA Code which requires the Authority to approve a treasury management strategy before the start of each financial year.

The Council considered a report seeking approval for the Treasury Management strategy and Investment strategy for 2019/20.  On a motion from Councillor Charles Gerrish, seconded by Councillor Paul May, it was

RESOLVED (unanimously) to agree;

1.  To approve the actions proposed within the Treasury Management Strategy Statement, as set out in Appendix 1 to the report; and

2.  To approve the Treasury Investment Strategy as set out in Appendix 2 of the report.

Treasury risk management at the Authority is conducted within the framework of the Chartered Institute of Public Finance and Accountancy’s Treasury Management in the Public Services: Code of Practice 2017 Edition (the CIPFA Code) which requires the Authority to approve a treasury management strategy before the start of each financial year. This report fulfils the Authority’s legal obligation under the Local Government Act 2003 to have regard to the CIPFA Code.

Treasury management is the management of the Authority’s cash flows, borrowing and investments, and the associated risks. The Authority has borrowed and invested substantial sums of money and is therefore exposed to financial risks including the loss of invested funds and the revenue effect of changing interest rates.  The successful identification, monitoring and control of financial risk are therefore central to the Authority’s prudent financial management.

Investments held for service purposes or for commercial profit are considered in the Capital and Investment Strategy within the Budget Report which is also included on this meeting’s agenda.

Councillor Charles Gerrish introduced the report by saying that the report presented the Council’s Annual Treasury Management Strategy for 2019/20 which under the CIPFA Code of Practice requires Council Approval before the start of each financial year.

The report has set out the strategy for borrowing and investments and for giving priority to the security and liquidity of those investments ahead of yield.

The Council’s Audit Committee would also scrutinise the Strategy at its meeting on 7th February and any comments would be verbally reported to the Council meeting on 19th February.

The Council’s chief objective when borrowing money was to strike an appropriately low risk balance between securing low interest costs and achieving cost certainty over the period for which funds were required.  . The Council would continue to consider investment in the CCLA Property Fund and other longer term pooled funds with a view to providing further diversification of its commercial property and investment portfolios and the potential for earning a higher investment yield whilst maintaining regards to security through investment in these higher yielding asset classes.

Councillor Charles Gerrish moved the recommendations.

Councillor Paul Myers seconded the motion by saying that the Strategy would fulfil Council’s obligation for the next three years.

RESOLVED (unanimously) that the Cabinet agreed to:

1)  Recommend the actions proposed within the Treasury Management Strategy Statement (Appendix 1) to February Council.

2)  Recommend the Investment Strategy as detailed in Appendix 2 to February Council.

3)  Note the Treasury Management Indicators detailed in Appendix 1 and delegate authority for updating the indicators prior to approval at Full Council on 19th February 2019 to the Chief Finance Officer and Cabinet Member for Finance & Efficiency, in light of any changes to the recommended budget as set out in the Budget Report elsewhere on the agenda for this meeting.

4)  Note that any comments made by the Corporate Audit Committee at their meeting on the 7^th February 2019 will be reported to Full Council on the 19^th February.