Agenda item

Including the Minimum Revenue Provision Policy Statement, Annual Investment Strategy and Prudential Indicators

Consideration was given to a report of the Director of Finance which present to Policy Overview and Scrutiny Committee, the strategy for 2023/24 Treasury Management activities including the Minimum Revenue Provision Policy Statement, the Annual Investment Strategy and Prudential Indicators together with linkages to the Capital Strategy.

The report outlines the Treasury Management Strategy for 2023/24 including the Minimum Revenue Provision Policy Statement, Annual Investment Strategy and Prudential Indicators together with linkages to the Capital Strategy.

The Council is required through regulations supporting the Local Government Act 2003 to ‘have regard to’ the Prudential Code and to set Prudential Indicators for the next three years to ensure that the Council’s capital investment plans are affordable, prudent and sustainable. It is also required to produce an annual Treasury Strategy for borrowing and to prepare an Annual Investment Strategy setting out the Council’s policies for managing its investments and for giving priority to security and liquidity of those investments.

The Chartered Institute of Public Finance and Accountancy (CIPFA) Code of Practice on Treasury Management 2021 (the Code) also requires the receipt by full Council of a Treasury Management Strategy Statement.

The Strategy for 2023/24 covers two main areas.

1) Capital Issues:

 • The Capital expenditure plans and the associated Prudential Indicators

 • The Minimum Revenue Provision (MRP) Policy Statement 2)

 Treasury Management Issues:

 • The Current Treasury Position

 • Treasury Indicators which limit the treasury risk and activities of the Council

 • Prospects for Interest Rates

 • The Borrowing Strategy

 • The Policy on Borrowing in Advance of Need

 • Debt Rescheduling

 • The Investment Strategy

 • The Creditworthiness Policy

 • The Policy regarding the use of external service providers.

The report therefore outlines the implications and key factors in relation to each of the above Capital and Treasury Management issues and makes recommendations with regard to the Treasury Management Strategy for 2023/24.

The report includes the most recently available economic background commentary which reflects the position at 22 December 2022.

The Treasury Management Strategy was considered by the Audit Committee on 16 January 2023 as it is the body charged with reviewing Treasury Management reports and making recommendations to the responsible body (i.e., Council). The Audit Committee was content to recommend the report to Cabinet and Council for approval.

The proposed Treasury Management Strategy is presented to the Policy Overview and Scrutiny Committee to enable scrutiny of the report so that any comments may be incorporated into the report before it is considered by Cabinet on 13 February 2023 and Council on 1 March 2023.

RESOLVED that the following be accepted and commended to Cabinet

1. Capital Expenditure Estimates as per paragraph 2.1.2;

2. MRP policy and method of calculation as per Appendix 1;

3. Capital Financing Requirement (CFR) Projections as per paragraph 2.2.3; 4. Projected treasury position as at 31 March 2023 as per paragraph 2.4.3;

5. Treasury Limits as per section 2.5;

6. Borrowing Strategy for 2023/24 as per section 2.7;

7. Annual Investment Strategy as per section 2.11 including risk management

    and the creditworthiness policy at section 2.12; and

8. Level of investment in specified and non-specified investments detailed at 

    Appendix 5