Issue - meetings

The Chairman of the Corporate Policy and Resources Committee presented the annual Treasury Management Report for 2020/2021report to Council which stood  recommended by her Committee.

The report detailed the outturn position for Treasury activities, and highlighted compliance with the Council’s Treasury Management Policy previously scrutinised by Governance and Audit Committee and approved by Council. 

The prudential indicators, which had been monitored throughout the year by the Committee, were detailed in section 3 of the report.

Whilst interest returns had remained low and were projected to remain low for the foreseeable future, the Council had maintained an average balance of £21m in investments and had earned an average return of 0.896% resulting in interest of £0.185m, mainly due to the £3m investment in the CCLA Property Fund (£0.152m).

The Capital Financing Requirement, which represented the Council’s underlying borrowing need, at the end of March was reported at £38.525m, of which external borrowing had remained consistent at £20m.

Whilst the Council policy was not to charge an annual Minimum Revenue Provision(MRP) for its investment properties, during the year a voluntary revenue provision of £707,000 had been made. The MRP made for the year against other borrowing was £0.251m, and Members noted these payments effectively reduced the Council’s borrowing need.

Debate ensued and whilst accepting the report was primarily related to finance, a Member of Climate and Sustainability Working Group considered all activities had an impact on the climate, and as such, Officers should consider these matters and report the implications accordingly. For example the investments held with other banks and money markets could have climate related risks, investing in property brought with it a climate impact.

The S151 Officer responded accordingly. A Member commented on the success of CCLA investments, an opportune discovery which had paid dividends.

In response to questions, regarding promotion of recommendations, referencing comments in the earlier debate, a former Leader of the Council, outlined press activity he had undertaken in his role. Given the previous response of the Head of Paid Service, he questioned if he acted inappropriately, citing the role description of the Leader of the Council in Article 12 of the Constitution.

The Chief Executive clarified his comments, indicating they related to motions submitted under procedure rule 10, as opposed to motions arising from recommendations within reports, confirming the actions of the previous Leader in respect of promotion, had been acceptable within his role.

The response was challenged and the Chief Executive undertook to look into the matter outside of the meeting.

The Chairman of the Governance and Audit Committee, reminded Members that reports style and content was under review this year with the opportunity for Members to be engaged.  Furthermore, should the constitution need revision, given the comments expressed, such matters would be considered as part of the Annual Review.

Having being moved, seconded and on being put to the vote it was: -

RESOLVED that the Annual Treasury Management Report and actual Prudential Indicators 2020/21 be approved.

.

Members gave consideration to the Annual Treasury Report, presented by the Corporate Finance Team Leader. She explained that the Council were required to receive, as a minimum, three reports per year. These being an annual treasury strategy in advance of the year (March 2020); a mid-year, (minimum), treasury update report (November 2020) and an annual review following the end of the year describing the activity compared to the strategy, (this report). She stated that, in addition, the Committee had received quarterly treasury management update reports.

Members heard that the regulatory environment placed responsibility on Members for the review and scrutiny of treasury management policy and activities. This report was, therefore, important in that respect, as it provided details of the outturn position for treasury activities and highlighted compliance with the Council’s policies previously approved by Members. The council confirmed that it had complied with the requirement under the Code to give prior scrutiny to all of the above treasury management reports by either the Governance and Audit Committee, who provided scrutiny of the Treasury Management Strategy, or the Corporate Policy and Resources Committee who monitored in year performance and mid-year updates. Member training on treasury management issues was undertaken during the year in order to support Members’ scrutiny role.

It was stated that during 2020/21, the council complied with its legislative and regulatory requirements and the presented report summarised the following:

·         Capital activity during the year;

·         Impact of this activity on the Council’s underlying indebtedness, (the Capital Financing Requirement);

·         The actual prudential and treasury indicators;

·         Overall treasury position identifying how the Council had borrowed in relation to this indebtedness, and the impact on investment balances;

·         Summary of interest rate movements in the year;

·         Detailed debt activity; and

·         Detailed investment activity.

Members thanked the Officer for her report and stated it was clear and concise. Members wished to commend the Team Leader and her team for their hard work. It was therefore

RESOLVED that the Annual Treasury Management Report and actual Prudential Indicators 2020/21 be recommended to Full Council for approval.