Issue - meetings

To submit the report of the Director of Function (Resources)/Section 151 Officer.  

It was resolved to note the Treasury Management Mid-Year Review report for 2025/26.

The report of the Director of Function (Resources)/Section 151 Officer which set out the Council’s performance in relation to the 2025/26 treasury management strategy at the mid-year point was presented for the Executive’s  consideration.

Councillor Robin Williams, Deputy Leader and Portfolio Member for Finance, Corporate Business and Customer Experience presented the report as required by CIPFA’s Code of Practice for Treasury Management 2021 and CIPFA’s Prudential Code 2021. The report provides an economic update, outlines the current position in respect of borrowing and investment performance and measures the Council’s current position against the performance indicators set out in the Treasury Management Strategy.

The Director of Function (Resources) reported that capital expenditure remains broadly on target at the six month point.  The Council has continued its strategy of using its own cash balances to fund capital projects and has avoided the need to borrow during the first half of the year. However, these balances have reduced as they have been used to support both capital expenditure and the revenue budget.

The Council’s investments are held in short, fixed term deposits with mainstream banks and other local authorities. These are now due to mature and it is unlikely that any further investments will be made in the fourth quarter. However, Table 4 of the report shows that the interest received on investments is higher than budgeted due to interest rates being higher than anticipated when the budget was set.

In confirming that treasury management performance remains in line with the prudential indicators approved by the Council, the Section 151 Officer noted a minor technical breach of treasury management practice as outlined in paragraph 8 of the report. This occurred  when a call account briefly exceeded the limits set by the treasury management strategy as a result of interest being credited to the account.

The Section 151 Officer further explained in response to a question about whether making  no investments in the fourth quarter was usual practice, that the Council has held healthy balances in the years since the pandemic due to Covid related grants, which it was able to invest. These balances have been utilised in the years since, and the Council is now down to its final £5m of investments which are currently maturing. It is likely that the Council will need to borrow in the first half of the new year. This borrowing would be on a short term basis of around a year in the expectation that interest rates may fall, allowing the Council to refinance for a longer period on a lower rate.

It was resolved to note the Treasury Management Mid-Year Review report for 2025/26.