To receive the Treasury Management Strategy 2018-19.
The Committee considered the Treasury Management Strategy 2018-19.
During the discussion of this item the following points were made:
· For 2018/19 external debt was estimated to increase by £61.5million to £206.7million. This increase was a very prudent estimate and would be reliant on the delivery of the capital programme.
· Members were advised that a couple of tables within the report remained to be confirmed due to sensitivity around next year’s revenue budget.
· The Capital Programme was estimated to be £180million next year before carry-forward and over the next three years was estimated to be a total of £534.5million. The Financial Planning Specialist highlighted the different asset types that this was broken down into. This would be funded by £535million of resources. It was noted that there was a small surplus of funding which was currently estimated to be capital receipts.
· Members were advised that with this ambitious Capital Programme came additional borrowing. 37% of this borrowing was for forward funding projects which would be funded by S106 or CIL, 41.5 % of borrowing was for invest to save projects e.g. new leisure projects, 17.5 % was for loans for Wokingham Town Centre Regeneration and Wokingham Housing Limited, and 4% was for approved borrowing (MRP funded).
· The total forecast additional borrowing (£243.2million) would be fully met by a number of resources within 24 years. During this period many large infrastructure schemes profiles would be refined during the build process which would have an impact on the borrowing forecast.
· For 2018/19 the estimated returns on investments, both external and internal companies, was set to increase from the 2017/18 estimated outturn by £1.0million to £2.4million, rising to £2.9million in 2020/21. This increase was mainly due to the return on the loans made to Wokingham Housing Limited and Wokingham Town Centre Regeneration.
RESOLVED: That the following be recommended to Council for approval:
1) Capital Prudential indicators, 2018/19;
2) Borrowing strategy 2018/19;
3) Annual Investment Strategy 2018/19;
4) Flexible use of capital receipts strategy;
5) MRP policy; and
6) Treasury Indicators: limits to borrowing activity 2018/19.