Agenda item

To receive the report of the Cabinet Member for Performance and Resources which seeks approval for the Treasury Management Strategy and prudential indicators and which asks Council to note Treasury activities.

99.1      Council considered a report of the Cabinet Member for Performance and Resources seeking approval of the Treasury Management Strategy.

99.2      Councillor Norman (Cabinet Member for Performance and Resources) moved the recommendations set out in the report.

99.3      Councillor James seconded the motion.

99.4      Councillor Norman explained that money received from central government as a result of the stock transfer would be used to repay market debt, but that because early repayment would incur a substantial charge, the market would be monitored to identify the most prudent time to clear the debt.

99.5      Councillor Smith noted that the report did not contain a risk table and expressed concern about the level of risk within the strategy; in particular she noted the cost of borrowing increasing and the impact of the anti-austerity political movement.

99.6      Andrew Cummings, Management Accountant, agreed to explore whether a risk table could be provided. He explained that the challenge was in repaying the debt without incurring a substantial early repayment fee, so the short term plan was to hold on to the money received from the government as a result of the stock transfer. In respect of the ratio of financing costs to net revenue stream, he advised that this had increased due to the purchase of land at Kings Quarter, but that the Council received a rental income to offset the cost.

99.7      Councillor Wilson stated the decision to hold on to the housing stick transfer money was prudent and that overall he was satisfied with the strategy.

99.8      RESOLVED –

(1)      That the Treasury Management Strategy at Appendix 1 be approved;

(2)      That the authorised borrowing limit be approved at:-

a)       2015/16 £45m

b)       2016/17 £35m

c)        2017/18 £35m

(3)      That the prudential indicators set on in section two of the strategy be approved.

(4)      That authority is delegated to s151 Officer in consultation with the Cabinet Member for Performance and Resources to make decisions on Treasury Management from 17^th March 2015 to the 1^st April 2015 outside of the 14/15 Treasury Strategy as a result of the stock transfer.