Issue - meetings

Treasury Management Strategy and Investment Strategy

Meeting: 08/02/2021 - County Council (Item 3)

3 Treasury Management Strategy and Investment Strategy pdf icon PDF 545 KB

Following consideration by Cabinet on 28 January 2021 this report is presented to Council for approval.

Additional documents:

Minutes:

Councillor Peter Butlin moved the motion, explaining that unlike previous years when theses documents were agreed, more or less as a matter of course, the Pandemic has led to changes in how the council manages its money.

 

The motion was seconded by Councillor Izzi Seccombe who reserved her right to speak.

 

Councillor Keith Kondakor expressed concerns over the projections being used for the Warwickshire property and Development Company. In particular he stated that house prices may drop significantly in line with reductions in demand for housing. In addition, construction inflation is increasing thus reducing profit margins. He suggested that the company could end up making a loss. A sensitivity analysis is required he concluded.

 

Councillor Seccombe chose not to speak.

 

Councillor Butlin concluded by stating that borrowing by the council has to date been low. He added that the risks of the project had been clearly set out.

 

Vote

 

A recorded vote was requested.

 

 

Votes for

 

Councillors Barker, Bell, Singh Birdi, Boad, Brain, Butlin, Caborn, Cargill, Clarke, Cockburn, Cooke, Crump, Dahmash, N. Davies, Falp, Fradgley, Gifford, Gilbert, Golby, Hayfield, Horner, Jenns, Kaur, Morgan, Pandher, Parry, Redford, Reilly, Rickhards, Roberts, Rolfe, Roodhouse, Sargeant, Seccombe, Shilton, Simpson-Vince, Timms, Warwick, C. Williams, P.Williams (40)

 

Votes against

 

Councillors Adkins, Chilvers, C. Davies, Dirveiks, Holland, Kondakor, O’Rourke, Parsons, Phillips, Webb (10)

 

Resolved:

 

That:

 

1.       The Treasury Management Strategy for 2021/22 (Appendix 2) be approved with effect from 1st April 2021.

 

2.       The Investment Strategy for 2021/22 (Appendix 3) be approved with effect from 1 April 2021.

 

3.       The County Council requires the Strategic Director for Resources to ensure that gross borrowing does not exceed the prudential level specified (Appendix 2,Section 3.2, Table 10 “Authorised Borrowing Limit”).

 

4.       The County Council requires the Strategic Director for Resources to ensure that gross investment in non-Treasury investments does not exceed the prudential levels specified (Appendix 3, Annex 7).

 

5.       The County Council delegate authority to the Strategic Director for Resources to undertake delegated responsibilities in respect of both strategies (Appendix 2, Annex 7, and Appendix 3, Section 2.5).

 

6.       The County Council requires the Strategic Director for Resources to implement the Minimum Revenue Provision (MRP) Policy (Appendix 2, Section 2.4).


Meeting: 28/01/2021 - Cabinet (Item 5)

5 Treasury Management Strategy and Investment Strategy pdf icon PDF 545 KB

Prior to consideration at Council on 8 February 2021 this report sets out the Treasury Management Strategy and Investment Strategy for Cabinet endorsement.

 

Cabinet Portfolio Holder – Councillor Peter Butlin

Additional documents:

Minutes:

In introducing this report Councillor Peter Butlin explained that normally the Treasury Management Strategy and the Investment Strategy are presented to Cabinet as a matter of course. This year, however, there have been a number of changes brought about by the Pandemic. The Council has been required to seek ways to be more flexible with its funds. Borrowing has been required to assist recovery projects whilst low interest rates have made it necessary to keep moving money round. A further consideration has been the risk of negative interest rates where the Council could end up paying to have its money looked after.

 

Referencing page 196 of the document pack Councillor Jerry Roodhouse emphasised the need to closely monitor borrowing. In addition, he noted that there were fewer references in the document to measure to address climate change. These had been present two years ago but seemed to have disappeared.

 

Councillor Andy Crump (Portfolio Holder for Fire & Rescue and Community Safety) commended the report adding that it demonstrated that the County Council has a degree of flexibility built into its finances. He commended finace officers for their hard work.

 

Councillor Kondakor emphasised the implications of getting the Council’s borrowing wrong. He suggested that some borough and district councils have under-borrowed and added that the County Council should work with the in managing their investments. Now, he suggested, is not the right time to be taking risks.

 

In closing Councillor Peter Butlin noted that green considerations are in the documents. Climate Change is at the forefront of at the Council does. Regarding the taking of risks, cabinet was assured that all decisions are carefully risk assessed.

 

Resolved:

 

That Cabinet recommends to Council that:

 

1.       The Treasury Management Strategy for 2021/22 (Appendix 2) be approved with effect from 1st April 2021.

 

2.       The Investment Strategy for 2021/22 (Appendix 3) be approved with effect from 1 April 2021.

 

3.       That the County Council requires the Strategic Director for Resources to ensure that gross borrowing does not exceed the prudential level specified (Appendix 2, Section 3.2, Table 10 “Authorised Borrowing Limit”).

 

4.       That the County Council requires the Strategic Director for Resources to ensure that gross investment in non-Treasury investments does not exceed the prudential levels specified (Appendix 3, Annex 7).

 

5.       That the County Council delegate authority to the Strategic Director for Resources to undertake delegated responsibilities in respect of both strategies (Appendix 2, Annex 7, and Appendix 3, Section 2.5).

 

6.       That the County Council requires the Strategic Director for Resources to implement the Minimum Revenue Provision (MRP) Policy (Appendix 2, Section 2.4).