Agenda item

Treasury Management Strategy 2021-2022

[To approve the Treasury Management Strategy 2021-2022]

Decision:

That Council be recommended to approve:

1.    The authorised borrowing limit for 2021-2022 to support the capital strategy as required under Section 3(1) of the Local Government Act 2003 to be set at £1,166.2 million (PI3, Appendix 3 to the report); the forecast borrowing is below the authorised borrowing limit.

 

2.    The Treasury Management Strategy Statement 2021-2022 as set out in Appendix 1 to the report.

 

3.    The Annual Investment Strategy 2021-2022 as set out in Appendix 2 to the report.

 

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

 

5.    The Annual Minimum Revenue Provision (MRP) Statement setting out the method used to calculate MRP for 2021-2022 as set out in Appendix 4 to the report.

 

6.    The method used to calculate MRP for 2020-2021 as set out in the Annual MRP Statement approved by Council on 4 March 2020 be amended to the method as set out in Appendix 4 to the report.

 

7.    The Treasury Management Policy Statement and Treasury Management Practices as set out inAppendix 6 to the report.

 

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 would be reported to the Cabinet Member 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 unprecedented impact of Covid-19 on the economy.

 

The Cabinet approves:

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

 

The Cabinet recommends that Council be asked to note:

1.    That the MRP charge for the financial year 2021-2022 would be £18.2 million; it is forecast to increase to £25.5 million in 2022-2023 (paragraph 2.14 of the report).

 

2.    That Cabinet or Cabinet (Resources) Panel and Council would receive regular Treasury Management reports during 2021-2022 on performance against the key targets and Prudential and Treasury Management Indicators in the Treasury Management Strategy and Investment Strategy as set out in paragraph 2.12 and Appendices 2 and 3 to the report.

 

 

Minutes:

Councillor Louise Miles presented the report on the Treasury Management Strategy 2021-2022 for approval and recommendation to Full Council. The Strategy set out various strategies the Council must comply with in the management of its borrowing, investments and cash flows, its banking, money market and capital market transactions; the effective control of the risks associated with those activities; and the pursuit of optimum performance consistent with those risks.

 

Resolved:

That Council be recommended to approve:

1.    The authorised borrowing limit for 2021-2022 to support the capital strategy as required under Section 3(1) of the Local Government Act 2003 to be set at £1,166.2 million (PI3, Appendix 3 to the report); the forecast borrowing is below the authorised borrowing limit.

 

2.    The Treasury Management Strategy Statement 2021-2022 as set out in Appendix 1 to the report.

 

3.    The Annual Investment Strategy 2021-2022 as set out in Appendix 2 to the report.

 

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

 

5.    The Annual Minimum Revenue Provision (MRP) Statement setting out the method used to calculate MRP for 2021-2022 as set out in Appendix 4 to the report.

 

6.    The method used to calculate MRP for 2020-2021 as set out in the Annual MRP Statement approved by Council on 4 March 2020 be amended to the method as set out in Appendix 4 to the report.

 

7.    The Treasury Management Policy Statement and Treasury Management Practices as set out inAppendix 6 to the report.

 

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 would be reported to the Cabinet Member 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 unprecedented impact of Covid-19 on the economy.

 

The Cabinet approves:

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

 

The Cabinet recommends that Council be asked to note:

1.    That the MRP charge for the financial year 2021-2022 would be £18.2 million; it is forecast to increase to £25.5 million in 2022-2023 (paragraph 2.14 of the report).

 

2.    That Cabinet or Cabinet (Resources) Panel and Council would receive regular Treasury Management reports during 2021-2022 on performance against the key targets and Prudential and Treasury Management Indicators in the Treasury Management Strategy and Investment Strategy as set out in paragraph 2.12 and Appendices 2 and 3 to the report.

Supporting documents: