Decision details

That Council be recommended to approve:

1.    The authorised borrowing limit for 2022-2023 to support the capital strategy as required under Section 3(1) of the Local Government Act 2003 to be set at £1,163.3 million (PI3, Appendix 3 to this report).  The authorised borrowing limit includes a forecast provision for potential business cases that may be brought forward during the year, additional borrowing will only be authorised if the business case proves to be affordable over the medium term.  The forecast borrowing is below the authorised borrowing limit.

2.    The Treasury Management Strategy Statement 2022-2023 as set out in Appendix 1 to this report.

3.    The Annual Investment Strategy 2022-2023 as set out in Appendix 2 to this report.

4.    The Prudential and Treasury Management Indicators as set out in Appendix 3 to this report.

5.    The Annual Minimum Revenue Provision (MRP) Statement setting out the method used to calculate MRP for 2022-2023 as set out in Appendix 4 to this report.

6.    The Treasury Management Policy Statement and Treasury Management Practices as set out in Appendix 6 to this report.

7.    That authority be delegated to Cabinet to approve updates to the Treasury Management Strategy and corresponding practices during 2022-2023 to reflect the additional reporting requirements detailed in the most recent publication of the revised Treasury Management and Prudential Codes. It is important to note that, the Council complies with the principles of the codes however due to the timing of the release of the new Codes, CIPFA has allowed reporting on the Codes to be deferred until 2023-2024.

8.    That authority continues to be delegated to the Director of Finance to amend the Treasury Management Policy and Practices and any corresponding changes required to the Treasury Management Strategy, the Prudential and Treasury Management Indicators, the Investment Strategy and the Annual MRP Statement to ensure they remain aligned.  Any amendments will be reported to the Portfolio Holder for Resources and Cabinet (Resources) Panel as appropriate.

9.    That authority continues to be delegated to the Director of Finance to lower the minimum sovereign rating in the Annual Investment Strategy, in the event of the UK’s credit rating being downgraded by the third credit rating agency, due to the current economic climate.

10.That authority is delegated to the Portfolio Holder for Resources, in consultation with the Director of Finance, to amend the MRP statement should this be required following the outcome of the consultation.

That Cabinet approves:

1.    That authority is delegated to the Portfolio Holder for Resources in consultation with the Director of Finance to progress feasibility and investment propositions in a timely manner.  Updates on any propositions will be provided to Cabinet or Cabinet (Resources) Panel in future reports.

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That Council be recommended to note:

1.    That the MRP charge for the financial year 2022-2023 will be £19.8million; it is forecast to increase to £21.1 million in 2023-2024 (paragraph 2.20 of the report).

2.    That Cabinet or Cabinet (Resources) Panel and Council would receive regular Treasury Management reports during 2022-2023 on performance against the key targets and Prudential and Treasury Management Indicators in the Treasury Management Strategy and Investment Strategy, as set out in the paragraph 2.18 and Appendices 2 and 3 to this report.

3.    That the new Treasury Management and Prudential Codes have been published and are effective immediately.  However, due to the date of their release some elements, mainly changes to the capital strategy, prudential indicators and investment reporting can be deferred until 2023-2024.  The documents covered in this report have been updated where possible to reflect the new Codes, any changes not reflected due to the timescales will be implemented and approval sought during 2022-2023.

4.    That the documents covered in this report have been updated to reflect the latest interest rate forecasts available, however, due to uncertainties with the economy, should interest rates increase quicker than forecast, this may create a budget pressure on the treasury management budget. In the event that this were to occur, approval would be sought to accommodate the budget pressure by making a call on the Budget Contingency Reserve. This will continue to be monitored and reviewed in light of the changing economic environment, with updates provided to Councillors throughout 2022-2023 as part of the quarterly update reports.