Agenda item

To receive the Treasury Management Strategy 2017/18.

The Committee considered the proposed Treasury Management Strategy for 2017/18.

Martin Jones tabled amended Appendices A and B which had been updated following a late recommendation by the Council’s treasury advisors.  It was noted that this would provide more flexibility on borrowing capacity.   Martin went through the report and highlighted that for 2017/18 external borrowing could increase by £53m.  Part of that borrowing would be achieved through cashflow rather than investment which reduces costs.  It was confirmed that all loans were taken up on a fixed rate basis which was currently averaging 3.4%.

During discussion of the item the following comments were made:

·         It was confirmed that payback of borrowing, as shown in Table 5, would be by year 14 from the 2018/19 financial year;

·         In relation to debt incurred due to capital investment in residential property it was felt it would be useful to state what the asset value was of such property.  In was noted that it had not yet been decided if the Council would wish to sell the property or use it as an income stream.  The Chairman agreed to take up this matter with the Leader of Council and the Chief Executive;

·         It was noted that borrowing did not include forward funding for infrastructure.  Members were advised that the Council would receive S106 and CIL monies to cover these costs;

·         In response to a query about how vulnerable the expected S106 and CIL monies were, when taking account of possible slippages, it was confirmed that if there was slippage in building work there was also likely to be slippage in the amount that would have to be paid on infrastructure.  This matter was reviewed on a quarterly basis and checks were made with the relevant service departments;

·         In relation to the SDL sites Councillor Lee queried what would happen if a development went bust but there was still planning permission on the land; would the relevant monies still be paid to the Council?

RESOLVED:  That the Audit Committee recommend to Council for approval, subject to the inclusion of a breakdown of borrowing and how it will be repaid, the following:

1)         Capital Prudential indicators, 2017/18;

2)         Borrowing strategy 2017/18;

3)         Annual Investment Strategy 2017/18;

4)         Flexible use of capital receipts strategy;

5)         MRP policy; and

6)         Treasury Indicators: limits to borrowing activity 2017/18.