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101 Annual Treasury Management Strategy Statement PDF 289 KB
Additional documents:
Minutes:
Matter for
decision
The Council is required by regulations issued under the Local Government
Act 2003, to produce an Annual Treasury Management Strategy Report. The
officer’s report complied with the CIPFA Code of Practice on Treasury Management
(revised 2011). The Code required as a
minimum, receipt by full council of an Annual Treasury Management Strategy
Statement – including the Annual Investment Strategy and Minimum Revenue
Provision Policy – for the year ahead, a half-year review report and an Annual
Report (stewardship report) covering activities in the previous year.
Decision of the
Executive Councillor for Finance and Resources to recommend to Council:
i.
The Annual Borrowing Statement at paragraph
4, the Council’s Minimum Revenue Provision (MRP) Policy at paragraph 5 and the
Council’s Annual Investment Strategy as contained within paragraphs 8 & 9.
ii.
An amendment to the counterparty list to
include Enhanced Cash Funds. A limit of
£5m is recommended and has been updated within Appendix A as follows
Name |
Recommended Limit (£) |
Enhanced Cash Funds (Standard & Poor’s:
AAA/S1, Fitch: AAA/V1) |
5m (in each fund) |
iii.
Changes to the estimated Prudential & Treasury
Indicators for 2015/16 to 2018/19 inclusive as set out in Appendix C.
iv.
That the following counterparty limits are
required to come into effect on 1 April 2016 until further notice:-
·
Reduce HSBC’s counterparty limit by £5m to
£20m; and
·
Increase Barclays Bank plc counterparty limit
by £5m to £25m.
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 Head of Finance and reference
was made to the additional recommendation circulated prior to Committee in
relation to the Council’s Banking Contract which was awarded to Barclays Bank
with effect from 1 April 2016. The
incumbent providers are HSBC. The new
banking contract was engrossed by the Head of Legal Services on 13th
January 2016.
As a result an additional recommendation (additional text underlined)
to the Council’s counterparty limits was required as follows:
The Executive Councillor is asked to recommend to Council that the
following counterparty limits are required to come into effect on 1 April 2016
until further notice:-
·
Reduce HSBC’s counterparty limit by £5m
to £20m; and
·
Increase Barclays Bank plc counterparty
limit by £5m to £25m.
The Committee made the following comments in response to the report.
i.
Questioned whether the credit ratings of the
companies who tendered for the banking contract were taken into consideration
as part of the procurement process for the bank contract.
ii.
In relation to enhanced cash funds,
questioned what the risk was relative to other instruments.
The Executive Councillor confirmed that the procurement process was
there for a reason to ensure that inappropriate considerations were not taken
into account as part of the evaluation process of the submitted bids.
The Head of Finance responded that the enhanced cash funds were variable
asset value funds, the capital asset value was
variable and designed for the public sector market. Officer’s were conscious
of the requirement for the funds to retain their value. The Council could not use investments for
finance which would be needed in the short-term. Officer’s
were recommending the best rated funds.
The Committee unanimously resolved to endorse the recommendations which
included the additional recommendation.
The Executive Councillor for Finance and Resources approved the
recommendations.
Conflicts of
Interest Declared by the Executive Councillor for Finance and Resources (and
any Dispensations Granted):
Not applicable.