Issue - meetings

The Director of Finance and Business Improvement introduced the report of the Finance Manager setting out details of the activities of the Treasury Management function for the 2018/19 financial year in accordance with CIPFA’s Code of Practice on Treasury Management in Local Authorities, and in the context of the economic environment over the past 12 months.

The Director of Finance and Business Improvement advised the Committee that:

·  As at 31 March 2019, the Council had investments of approximately £15m.  The end of March was generally the lowest point in the year for the Council’s cash investments because it was only after the end of the month that Council Tax and Business Rates income started coming in again.

·  As at 30 July 2019, the value of the Council’s investments had increased to £26m.  The context for this was that the Council had a Capital Programme and would have quite significant cash requirements over the next few years so whilst the Council was holding cash at the moment it would be moving into a borrowing position over the next year or so.  The cash held was generally held on a short term basis to keep a degree of liquidity so that it was available when needed for capital investment.  Other than for short term purposes, the Council would not borrow before it had to because the cost of borrowing although relatively cheap at just over 2% was still more than it earned on cash balances (approximately 1%).

In response to questions, the Director of Finance and Business Improvement explained that:

·  The sum of £377 currently invested with Svenska Handelsbanken was to keep the account open.

·  Service loans supported the service objectives of the Council.  The Council had provided two service loans; one to Kent Savers, a credit union, to provide financing facilities for people who might not otherwise be able to access finance and the other to support the establishment of the BID.  The loan to the Cobtree Manor Estate Charity was a purely commercial transaction, hence the commercial rate of interest on the loan.

RESOLVED:

1.  That the review of the financial year 2018/19 undertaken in accordance with CIPFA’s Code of Practice on Treasury Management in Local Authorities and the prudential and treasury indicators be noted.

2.  That no amendments to the current treasury management procedures are necessary as a result of the review of activities in 2018/19.