Meeting documents

The PAG received a report which asked Members to advise the Portfolio Holder on whether to recommend the adoption of the Treasury Management Strategy & Annual Investment Strategy for 2014/2015.

The following were attached to the report:

•           Treasury Management Strategy Document 2014/15

•           Appendix A – Treasury Management Policy Statement

•           Appendix B – Annual Investment Strategy 2014/15

•           Appendix C – Interest Rate Forecasts

•           Appendix D – Economic Background

•           Appendix E – Prudential Code and Indicators Statement

•           Appendix F – Minimum Reserve Provision

The report, after explaining the various legal requirements under the Local Government Act 2003 and the Local Government Finance Act 1992, advised the PAG that the budget for investment interest was set at £775,000 for 2013/14 and was likely to be under-achieved by £75,000 by the end of the year.

The report went on to set a target for investment returns for 2014/15 of £550,000, a reduction of £225,000 compared to last year’s. This target was based upon an average level of cash balances of £27.5m, the latest forecasts for interest rates and the assumption that the Council wished to remain debt free.

The report also set out the proposal to undertake a joint tender exercise for banking services with Chiltern DC in 2014, the details of the procurement exercise being delegated to the Director of Resources to approve in consultation with the Portfolio Holder. The PAG were advised that having a single banking provider for the two Councils would offer an efficiency benefit if the two Councils agree in 2014 to have a shared finance team.

In the discussion which followed, a concern was raised that the decision making process for approving an investment could be too lengthy, possibly resulting in the Council not being able to exploit good investment opportunities. The PAG therefore requested that a report be presented to the next meeting on possible solutions to this issue, including the creation of a framework for investment under which the Director of Resources would have delegated authority, in consultation with the Portfolio Holder, to make urgent decisions on investments.

In response to a query, the PAG were advised that there were no plans at this time to implement a Joint Investment Strategy with Chiltern District Council.

The PAG after noting the advantages and disadvantages in investing in agricultural land, was advised that any suggestions of future investments made would always be given consideration, having regard to the Council’s Investment Strategy.

The PAG advised the Portfolio Holder to recommend to Cabinet that the Treasury Management Strategy be submitted to Council for approval.  Furthermore, the PAG supported the proposal to undertake a joint tender exercise for banking services with Chiltern DC in 2014, the details of the procurement exercise being delegated to the Director of Resources to approve in consultation with the Portfolio Holder.