Decision - Treasury Management and Capital Strategy

Decision details

Treasury Management and Capital Strategy

Decision Maker: Cabinet

Decision status: Recommendations Approved

Is Key decision?: No

Is subject to call in?: No


The Financial Services Manager introduced the report and explained that it was a new report for 2019/20 required by changes in CIPFA and the Ministry of Housing, Communities and Local Government (MHCLG) guidance. The strategies set limits and indicators that embodied the risk management approach the Council believed to be prudent.


The Financial Services Manager took Members through the Treasury Management Strategy Statement and highlighted a number of areas in particular, including:


·         The balance sheet summary and forecast as detailed in Table 1.  The forecast increase in Capital Financing Requirement (CFR) being driven by the planned investment programme.

·         The Medium Term Financial Plan does not include any surplus for planned investments, they have been included as cost neutral.

·         CIPFA recommended that the authority’s total debt should be lower than its highest forecast CFR over the next three years and this table showed that the Council expected to comply with this.

·         Table 3 highlights the counterparties that the council can invest with.  The amounts which can be invested have been increased from last year to ensure there is sufficient flexibility to manage potential cash surpluses.

·         Treasury Management Indicators – these are the indicators the Council uses to measure and manage its exposure to treasury management risks.

·         Capital receipts – the introduction of the new flexibility on the use of capital receipts to capitalise revenue costs which are part of a transformation programme with attributable savings has been used to support the potential Enterprise Resource Planning software implementation.

·         Appendix A to the report provided details of the Arlingclose Economic and Interest rate forecast.  It was explained that due to the current climate there was a degree of uncertainty around forward forecasting due to Brexit.

·         Appendix C – the Treasury Management Policy Statement, which the Council is required to include, and it was confirmed that there had been no changes to this from the previous year.

·         Details of the half year update in respect of Treasury Management.  There had been one investment which breached the limit on investments; however there was zero risk to the capital invested.


The Capital Strategy Report 2019/20 was a new report which gave a high level overview of how capital expenditure, capital financing and treasury management activity contributed to the provision of local public services along with an overview of how associated risk was managed and the implications for future financial sustainability. Appendix E of the report was the policy for flexible use of capital receipts.


RESOLVED that the half year treasury updated be noted.




a)    the Capital Strategy as an appropriate overarching strategy for the Council be approved and the flexible use of capital receipts as per appendix E


b)     the full Council approve the Treasury Management Strategy for 2019/20 and the associated limits, MRP policy  and treasury management policy (appendices C and D) and specific indicators included in this report.

Publication date: 18/03/2019

Date of decision: 13/03/2019

Decided at meeting: 13/03/2019 - Cabinet

Accompanying Documents: