Councillor Brian Robinson, Cabinet Member for an Efficient Council and Planning Policy, to present the Council’s Treasury Management Strategy 2012/2013, as detailed in report F.153, noted at the Audit Committee on 26 January 2012 and agreed at the Cabinet meeting on 9 February  2012. 

Council is recommended to adopt :-

a.      the Treasury Management Strategy for 2012/2013 to 2014/2015 contained in Annex B.

b.      the prudential and treasury indicators and limits for 2012/2013 to 2014/2015 contained in Annexes A, B and B2 of this report.

c.      the Minimum Revenue Provision (MRP) statement at paragraph 14 of Annex A of this report which sets out the Council’s policy on MRP.

d.      the Authorised Limit prudential indicator contained at paragraph 14 of Annex B to this report.

e.      the Investment Management Strategy for 2012/2013 contained in paragraphs 28 to 33 of Annex B of this report.

f.  the detailed criteria included in paragraph 44 of annex b to this report.

This item was considered at the meeting held on 23 February 2012.

Councillor Brian Robinson, Cabinet Member for an Efficient Council and Planning Policy, to present the Council’s Treasury Management Strategy 2012/2013, as detailed in report F.153, noted at the Audit Committee on 26 January 2012 and agreed at the Cabinet meeting on 9 February  2012. 

Council is recommended to adopt :-

a.      the Treasury Management Strategy for 2012/2013 to 2014/2015 contained in Annex B.

b.      the prudential and treasury indicators and limits for 2012/2013 to 2014/2015 contained in Annexes A, B and B2 of this report.

c.      the Minimum Revenue Provision (MRP) statement at paragraph 14 of Annex A of this report which sets out the Council’s policy on MRP.

d.      the Authorised Limit prudential indicator contained at paragraph 14 of Annex B to this report.

e.      the Investment Management Strategy for 2012/2013 contained in paragraphs 28 to 33 of Annex B of this report.

f.  the detailed criteria included in paragraph 44 of annex b to this report.

Cllr Robinson presented report F.153, explaining that it concerned how the council looked after its investments and any borrowing. He added that the Audit Committee and Cabinet had already considered the report, which included complex but important recommendations put together under the CIPFAS code of practice. The council sought safe institutions for investments and there was an opportunity to invest with other local authorities, which surprisingly offered a better risk than other places. He invited the Group Manager for Finance and Property to explain specific points.

The Group Manager emphasised that while prudential indicators had to be in place to control borrowing, the council did not borrow any money. Changes from the previous year included a tighter definition of part-nationalised bank (agenda page 45), the inclusion of treasury bonds and security bonds from AAA rated institutions. There was also the possibility for alternative investment to complement the council's work on areas such as housing, and a report would be presented to the Cabinet in May. Also the possibility to borrow at low fixed rates were an option, but would need to be agreed by the Cabinet.

Cllr Birch, Audit Committee Chairman, said that the committee considered treasury management at all of its meetings. The Audit Commission had commended the council's strategy with no qualification, which represented the best report for many years.

Cllr Thomson asked if the strategy was the responsibility of Full Council or the Cabinet.

Cllr Robinson replied that the Cabinet considered options for better outcomes, but would need to consult widely to gain a strategic direction and broad feedback.

The Solicitor to the Council clarified that Full Council was responsible for setting strategy, such as borrowing limits and capital expenditure, and that the Cabinet made decisions within that strategic framework.

Cllr Thomson asked how spending reserves was controlled, given that the council had over £4 million in reserves.

The Solicitor to the Council explained that there were many controls. The Audit Committee had an important role in overseeing the strategy and the Group Manager for Finance and Property would report to Full Council, if he were unhappy.

Cllr Winship expressed unease at being expected to vote on a report that she did not fully understand and suggested that the language be more layman-friendly. She asked for clarification on agenda page 42, paragraph 17.4.

The Group Manager for Finance and Property and that there would be specific training from the council's advisers before one of the next two Audit Committee meetings, to which all members were welcome. He explained that at present borrowing was more expensive than lending so only suitable where the council had a guaranteed return.

The chairman added that there had been a useful training session earlier in the month, but realised that some members had been unable to make it.

Cllr Molyneux commented that the report dealt with complex issues and that the council was lucky to have excellent officers who managed treasury work. He cited the group manager's actions to withdraw investment with  ...  view the full minutes text for item 9