Agenda item

Cabinet gave consideration to a report of the Finance Manager. Members were informed that the Council was required by regulations issued under the Local Government Act 2003 to produce an annual treasury management review of activities together with the actual prudential and treasury indicators for 2018/19. This report met the requirements of both the CIPFA Code of Practice on Treasury Management (the Code) and the CIPFA Prudential Code for Capital Finance in Local Authorities (the Prudential Code).

During 2018/19 the minimum reporting requirements were that full Council should receive the following reports:

·       an annual treasury strategy in advance of the year (approved 28 February 2018)

·       a mid-year (minimum) treasury update report (approved 12 December 2018)

·       an annual review following the end of the year describing the activity compared to the strategy (this report).

The regulatory environment placed responsibility on Members for the review and scrutiny of treasury management policy and activities. The report was therefore important, as it provided details of the outturn position for treasury activities and highlighted compliance with the Council’s policies previously approved by Members.

The Audit Committee was charged with the scrutiny of treasury management activities in Oldham and was therefore requested to review the content of the report prior to its consideration by Cabinet and Council. A programme of Treasury Management training had been developed and delivered to assist

Members of the Audit Committee with their scrutiny role. The Audit Committee had scrutinised the Treasury Management review at their meeting on 25

June 2019, and was content to commend the report to Cabinet.

The Cabinet noted that actual capital expenditure was less than the revised

budget estimate for 2018/19 presented within the 2018/19 Treasury Management Strategy report considered at the Council meeting of 27 February 2019. The outturn position was significantly less than the £89.658m original capital budget for 2018/19 as approved at Budget Council on 28 February 2018.

During the course of the year, the Capital Programme saw substantial rephasing. A number of major schemes including the Eastern Gateway Improvement Regeneration scheme and the Coliseum Theatre project were re-phased or re-aligned into future years to allow for either a review

of the scheme to be undertaken (as is the case with the theatre project) or to align with revised project timelines. The planned expenditure had therefore been re-profiled into 2019/20 and future years.

No borrowing was undertaken during the year. This was because of the policy of self-financing, utilised due to the uncertainty around interest rates and the availability of cash, which caused the Council to use cash reserves rather than incur additional borrowing costs.

The Director of Finance confirmed that the statutory borrowing limit (the Authorised Limit) was not breached.

The Cabinet noted that the financial year 2018/19 continued the challenging investment environment of previous years, namely low investment returns.

Options/Alternatives considered:-

In order that the Council complied with the Chartered Institute of Public Finance and Accountancy’s (CIPFA) Code of Practice on Treasury Management, the Council had no option other than to consider and approve the contents of the report. Therefore, no options/alternatives were presented.

RESOLVED that:-

1.     The actual 2018/19 prudential and treasury indicators presented in the report be approved.

2.     The annual treasury management review report for 2018/19 be approved.

3.     The report be commended to Council.