Issue - meetings

As detailed in the recommendations.

Councillor Johnson introduced the report and explained that local authorities were required to set a Minimum Revenue Provision (MRP) policy each financial year.

Each year, local authorities were required to set aside some of their revenue

resources as provision for the repayment of debt.

Regulations required an authority to make an amount of MRP which it considered to be ‘prudent’. The Regulations themselves did not define ‘prudent’ provision. Welsh Government (WG) had provided guidance which made recommendations to local authorities on the interpretation of the term and authorities were required to prepare an annual statement of their policy on making minimum provision.

The Council, as part of the budget strategy, conducted detailed reviews of its MRP policy in 2016/17 and 2017/18 and amended the policy as a result.

No changes were required to the Policy for 2024/25.

The Policy was presented to Members in conjunction with the 2024/25 budget setting report.

RESOLVED:

(a)       That the following be approved and recommended to County Council for Council Fund (CF) outstanding debt:

·         Option 3 (Asset Life Method) be used for the calculation of the MRP in financial year 2024/25 for the balance of outstanding capital expenditure funded from supported borrowing fixed as at 31^st March 2017.  The calculation will be the ‘annuity’ method over 49 years.

·         Option 3 (Asset Life Method) be used for the calculation of the MRP in 2024/25 for all capital expenditure funded from supported borrowing from 1^st April 2016 onwards.  The calculation will be the ‘annuity’ method over an appropriate number of years, dependent on the period of time that the capital expenditure is likely to generate benefits.

·         Option 3 (Asset Life Method) be used for the calculation of the MRP in 2024/25 for all capital expenditure funded from unsupported (prudential) borrowing or credit arrangement, including MIM.  The calculation will be the ‘annuity’ method over an appropriate number of years, dependent on the period of time that the capital expenditure is likely to generate benefits.

(b)       That the following be approved and recommended to County Council for Housing Revenue Account (HRA) outstanding debt:

·         Option 3(Asset Life Method) be used for the calculation of the HRA’s MRP in 2024/25 for the balance of outstanding capital expenditure funded from debt fixed as at 31^st March 2021.  The calculation will be the ‘annuity’ method over 50 years.

·         Option 3 (Asset Life Method) be used for the calculation of the HRA’s MRP in 2024/25 for all capital expenditure funded from debt from 1^st April 2021 onwards.  The calculation will be the ‘annuity’ method over an appropriate number of years, dependent on the period of time that the capital expenditure is likely to generate benefits.

(c)        Members approve and recommend to County Council that MRP on loans from the Council to NEW Homes to build affordable homes through the Strategic Housing and Regeneration Programme (SHARP) (which qualify as capital expenditure in accounting terms) be as follows:

·         No MRP is made during the construction period (of short duration) as the  ...  view the full minutes text for item 121