Issue - meetings

The Director of Finance and Business presented the report of the Interim Head of Finance proposing the adoption of an updated Capital Strategy.  It was noted that:

·  CIPFA’s Prudential Code which governs the Council’s capital investment and borrowing introduced a new requirement in 2019/20 for a Capital Strategy.  The intention was to ensure that Councils provide a high-level overview of how capital expenditure, capital financing and treasury management activity contribute to the provision of local public services together with a description of how associated risk is managed and the implications for future financial sustainability.

·  Accordingly, the Capital Strategy was an overarching document linking the Strategic Plan, the Medium Term Financial Strategy, the Treasury Management Strategy and the Asset Management Plan.  The Capital Strategy was adopted by the Council in February 2019 but since then best practice had evolved and the Council had started working with new treasury advisers, Link Asset Services.  It was therefore appropriate to take the opportunity to review and update the Strategy.

·  Specific details of the five year Capital Programme were set out in table 1 to the Capital Strategy.  The two main strands to the Strategy were housing development and regeneration where it was proposed to invest £35m and the acquisition of commercial assets where it was proposed to invest another £35m.  The acquisition of commercial assets not only generated a financial return, but also supported the local economy.

·  The Strategy also included details of the financing of the Capital Programme and the mechanisms to ensure that capital investment and the borrowing to support it is not excessive.  It could be seen that at the end of the five year period the financing costs only accounted for 7% of the net revenue stream, which represented a modest level of borrowing.

·  As part of the budget process for next year, Members would be asked to consider whether they wished to pursue a more ambitious Capital Programme to deliver the Council’s objectives.

In response to a question about whether there was a training need for Members on the Capital Strategy, the Director of Finance and Business Improvement confirmed that a briefing session could be arranged to take place before the meeting of the Committee in January 2020 when the updated Capital Strategy would be discussed.

RESOLVED to RECOMMEND to the COUNCIL:  That the updated Capital Strategy, attached as Appendix A to the report of the Director of Finance and Business Improvement, be agreed.