Agenda item

Annual Treasury Management Review for 2021/22

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

Minutes:

The report of the Director of Function (Resources)/ Section 151 Officer providing a review of the Council’s Treasury Management activities during the 2021/22 financial year and performance against the Treasury Management Strategy 2021/22 was presented for the Executive’s consideration.

 

In the absence of the Portfolio Member for Finance, Corporate Business and Customer Experience, Councillor Ieuan Williams, Portfolio Member for Education and the Welsh Language presented the report and he highlighted the statutory reporting requirements for Treasury Management and the specific outcomes covered by the 2021/22 review report. The report was scrutinised by the Governance and Audit Committee at its meeting on 28 September, 2022 and it confirms that the Council’s Treasury Management performance during the year was in line with the strategy of low risk, low return investments and a planned approach to borrowing designed to minimise interest charges.

 

The Director of Function (Resources)/Section 151 Officer advised the Executive that the Council’s accounts for 2021/22 have yet to be signed off pending the resolution of a technical issue that is affecting the accounts of all local authorities in Wales and some in England. Welsh Government, CIPFA and Audit Wales have now come to an agreement on a way forward which means that the audit of the accounts is likely to be completed in January, 2023. He confirmed that he was not aware of any issues arising that affect the figures contained in the review report. However, since the period covered by the report the financial landscape has changed considerably including in relation to better interest rates which have led to improved earnings on the Council’s investments which means the interest received budget can be increased when setting the 2023/24 budget.  No external borrowing was undertaken in the 2021/22 financial year with the Council instead maintaining its strategy of using cash balances in lieu of external borrowing. While that position is likely to change in 2023/24 any new borrowing the Council will take out in future will be more expensive.

 

In response to a question by the Chair, the Director of Function (Resources)/Section 151 Officer confirmed that the review report will not be submitted to Full Council until the accounts are signed off; the Chair’s view was that it would be appropriate for the final accounts and TM review report to be presented together to the same meeting of the Full Council. The Director of Function (Resources)/Section 151 Officer also clarified how the Public Works Loans Board (PWLB) lending works and how its interest rates are determined confirming that although PWLB loans are generally cheaper than those of commercial banks, the penalty for early repayment is higher than the interest saved making it uneconomical to do so. 

 

It was resolved –

·                To note that the outturn figures in the report will remain provisional until the audit of the 2021/22 Statement of Accounts is completed and signed off; any resulting significant adjustments to the figures included in the report will be reported as appropriate.

·                To note the provisional 2021/22 prudential and treasury indicators in the report.

·                To forward the Annual Treasury Management Review Report for 2021/22 to the Full Council without further comment.

 

Supporting documents: