Treasury Management Report - Mid Year 2021/22
Decision Maker: Cabinet
Decision status: Recommendations Approved (subject to call-in)
Is Key decision?: Yes
Is subject to call in?: No
The Cabinet considered a report of the Deputy Chief Executive and Executive Director (Finance and Resources) presenting the Mid-Year Treasury Management Report covering the treasury management activity and compliance with the treasury management strategy for both quarter two and the period from April to September 2021.
1. That the Treasury Management Mid-Year Position report for 2021/22, be approved.
2. That the benchmark against which in-house investment performance is measured be changed from 7-day LIBID to SONIA, with effect from 1 January 2022.
3. That it be noted that the treasury management activities were carried out in accordance with the CIPFA (The Chartered Institute of Public Finance and Accountancy) Code of Practice for Treasury Management in the Public Sector during the period from April to September 2021.
4. That it be noted that the loan and investment portfolios were actively managed to minimise cost and maximise interest earned, whilst maintaining a low level of risk.
5. That it be noted that £0.759m of interest and income distributions for all investments were earned during this six-month period at an average rate of 0.99%. This is 1.07% over the average 7-day LIBID (London Interbank Bid Rate) and 0.89% over the average bank rate. Also, the value of the externally managed funds increased by a net of £1.685m due to changes in the unit price, giving a combined overall return of 3.17%.
6. That it be noted that the level of borrowing from the Public Works Loan Board (PWLB) (excluding debt relating to services transferred from Essex County Council on 1st April 1998) remained at £310.3m (Housing Revenue Account (HRA): £75.0m, General Fund: £235.3m) during the period from April to September 2021.
7. That it be noted that the level of financing for ‘invest to save’ schemes decreased from £8.53m to £8.46m during the period from April to September 2021.
Reasons for Decisions:
The CIPFA Code of Practice on Treasury Management recommends that Local Authorities should submit reports regularly. The Treasury Management Policy Statement for 2021/22 set out that reports would be submitted to Cabinet quarterly on the activities of the treasury management operation.
There are many options available for the operation of the Treasury Management function, with varying degrees of risk associated with them. The Treasury Management Policy aims to effectively control risk to within a prudent level, whilst providing optimum performance consistent with that level of risk.
Note: This is an Executive Function
Eligible for call-in to: Policy and Resources Scrutiny Committee
Cabinet Member: Cllr Collins
Report author: Joe Chesterton
Publication date: 05/11/2021
Date of decision: 02/11/2021
Decided at meeting: 02/11/2021 - Cabinet