Issue - meetings

(a)       That the draft Treasury Management Annual Report 2015/16 be noted; and

(b)       That the Treasury Management 2016/17 Quarter 1 update be noted.

The Finance Manager - Technical Accountancy introduced the Annual Report on the Council’s Treasury Management Policy, Strategy and Practices 2015/16 together with an update on Treasury Management activity in Quarter 1 of 2016/17.  If supported, the Annual Report would be submitted to Cabinet and Council for approval in September.

In referring to the prospect of reduced interest rates, Councillor Haydn Bateman asked about the impact on investment counterparties and the prospect of further investment with the Debt Management Office (DMO).  The Finance Manager spoke about current predictions and the Council’s strategy to reduce investments as the borrowing requirement increased, with the focus of treasury activity shifting to short-term borrowing.  Decisions surrounding which counterparties to invest with would include consideration of the DMO as one of the options available as always.

When asked by Councillor Glyn Banks about borrowing for NEW Homes, the Finance Manager said this was likely to be done through the Public Works Loan Board (PWLB) due to the level of flexibility offered, with the Council on-lending to the company in the same way at a margin.  If there was a need to re-finance the loan, this could be done with PWLB at a cost but with some flexibility.  In response to a question on the investment portfolio, the Finance Manager spoke about the benefits of using small local authorities due to their higher credit quality.

Following concerns from Councillor Arnold Woolley about the expectation for a need to borrow for capital purposes from 2016/17 onwards, the Finance Manager said that borrowing requirements would depend on cash reserves held.  She said that projections had been set in line with the capital expenditure plans, subject to monitoring throughout the year, and that figures could be shared.

RESOLVED:

(a)       That the draft Treasury Management Annual Report 2015/16 be noted; and

(b)       That the Treasury Management 2016/17 Quarter 1 update be noted.