Decision details

Matter for Decision

The Council has adopted The Chartered Institute of Public Finance and Accountancy (CIPFA) Code of Practice on Treasury Management (Revised 2021).

 

The half-year report was prepared in accordance with the Code and covered:

·       An economic update for the first half of the 2024/25 financial year.

·       A review of the Treasury Management Strategy Statement and Annual Investment Strategy.

·       The Council’s capital expenditure, as set out in the Capital Strategy, and prudential indicators.

·       A review of the Council’s investment portfolio for 2024/25.

·       A review of the Council’s borrowing strategy for 2024/25; and

·       A review of compliance with Treasury and Prudential Limits for 2024/25.

 

Cash and investment balances at 30 September were £105 million. The balance was forecast to gradually reduce over the remainder of the year as existing balances were used to fund General Fund (GF) and Housing Revenue Account (HRA) capital expenditure.

 

Interest receipts for the year were projected at £6.6 million which was £3.1 million higher than the original budget. The variance was due mainly to sustained higher investment rates and higher cash balances being held for longer periods than expected.

 

Decision of Executive Councillor for Finance and Resources

i.                To recommend to Council the council’s estimated Prudential and Treasury Indicators for 2024/25 to 2027/28 (Appendix A).

ii.               To note that no changes have been made to the counterparty list (Appendix B).

 

Reason for the Decision

As set out in the Officer’s report.

 

Any Alternative Options Considered and Rejected

Not applicable.

 

Scrutiny Considerations

The Committee received a report from the Chief Finance Officer.

 

The Chief Finance Officer said the following in response to Members’ questions:

      i.          The additional borrowing detailed on p113 of the agenda mainly related to the Housing Revenue Account programme and was dependent on whether the capital expenditure was incurred this year. It was anticipated that there may be some slippage if there were delays with redevelopment projects. The Council only borrowed funding when it needed to. 

     ii.          Liquidity instruments (referred to on p128 of the agenda) were treasury management investments used to manage day to day (short term) cashflow e.g. a deposit on demand / 3-day notice deposit.

   iii.          The Council was limited in the progress it could make to decarbonise investments by the Statutory Investment Guidance that Local Authorities were required to follow and the CIPFA Treasury Management Code. Both of these statutory guidance documents required the Council gave priority to security of investments, then liquidity of investments, then yield and then environmental / social and governance (ESG) considerations. 

   iv.          The Council had a contract with Barclays Bank until 2026. A procurement exercise would be required to be undertaken before the end of the contract term for the services the contract delivered. The Finance Team were aware of the May 2024 motion referred to (minute reference 24/55/CNL Agenda for Council on Thursday, 23rd May, 2024, 11.05 am - Cambridge Council).

    v.          Confirmed the figure contained within column GF / CFR 2027/28 in the table at paragraph 7.2 of the officer’s report should be 106,185 and not 127,846. The correct figure had been used in Appendix A on page 120 of the agenda.

 

The Committee unanimously resolved to endorse the recommendations.

 

The Executive Councillor approved the recommendations.

 

Conflicts of Interest Declared by the Executive Councillor (and any Dispensations Granted)

No conflicts of interest were declared by the Executive Councillor.