Agenda item

The Executive Councillor for Finance and Resources Councillor B Mickelburgh to present the Council’s Treasury Management performance for the period 1 April to 30 September 2024.

(The report was considered by the Overview and Scrutiny Panel (Performance and Growth) and the Cabinet at their meetings in November 2024).

Consideration was given to a report by the Council’s Director of Finance and Corporate Resources (a copy of which is appended in the Minute Book) providing a six-month update in respect of treasury management activity for the period 1st April to 30th September 2024.

By way of background, the Executive Councillor for Finance and Resources reminded the Council that the 2024/25 Treasury Management Strategy was approved on 21st February 2024. He explained that Treasury Management was the management of the local authority’s borrowing, investments and cash flows, its banking, money market and capital market transactions, the effective control of the risks associated with those activities and the pursuit of optimum performance.

Members were then provided with further details regarding each of the areas of analysis these included a wider economic review, the performance of Council funds, the approach taken to risk management, details of the Council’s non treasury investments and the Treasury Management Indicators used by the Authority. Members were advised that the Council’s Section 151 Officer was content that all treasury management activities undertaken during the first half of the financial year had complied fully with the CIPFA Code of Practice and the approved Treasury Management Strategy.

In considering the contents of the report, Councillor J A Gray commented on the additional return which had been achieved on investment interest return compared to the budgeted position and an explanation was provided for this. A suggestion was also made that when considering the proportionality of investments, a better metric to consider might be what proportion of the Council’s net budget, is the income of the commercial investment portfolio currently making. In response to which, the Executive Councillor agreed that was a point worthy of further consideration. Efforts had been made over the course of the previous two years to improve the reporting of financial information for all members of the Council and he was keen to improve transparency further, including reporting on investment properties. Members also welcomed the fact that the Commercial Investment Strategy had been sufficiently robust to provide a resilient amount of income to the Council and looked forward to its forthcoming review.

With reference to comments which had been made to the proportionality of investments, Councillor P Hodgson-Jones drew attention to the differences between the way in which the Council accounts are presented compared to corporate accounts and the useful measures which could be missed from this type of reporting. He emphasised that when considering the proportionality of investments for example, the focus should be on the return from investment. In general terms the lack of transparency in the way in which public sector accounts were reported contributed to the overall problems with a transparency in local government finance, which meant that there was an absence of appropriate scrutiny in the best way to make investment decisions.

In response to which, the Executive Councillor for Finance and Resources concurred with the need for greater transparency to enable better informed decision making. The Chair of the Overview and Scrutiny Panel (Performance and Growth) Councillor C Gleadow added that efforts had been made to improve training for Panel Members and provide better information to assist with scrutiny in this regard.