Issue details

This report considers the draft Treasury Management Strategy and Investment Strategy for 2020/21, prior to its submission to the Council for approval.

Regulations require the Council to prepare and formally approve both an annual Treasury Management Strategy and Investment Strategy.  The document for 2020/21 is attached as Appendix A to this report for consideration by the Executive before being submitted to Council for approval.

In the past 12 months, the Council’s investment balance has ranged between £12 million and £24 million, and similar levels are expected to be maintained in the forthcoming year.  The majority of the Council’s investments are expected to be invested in short-term unsecured bank deposits and money market funds with approximately £12m available for longer-term investment.

Borrowing levels are expected to increase to a projected £72.5 million at the end of 2020/21 to fund the capital programme.  The Council has previously raised all of its long-term borrowing from the Public Works Loan Board (PWLB) but the government increased PWLB rates by 1% in October 2019 making it now a relatively expensive option.  The Strategy has therefore been revised to say the Council will now look to borrow any further long-term loans from other sources including banks, pensions and local authorities, and will investigate the possibility of issuing bonds and similar instruments, in order to lower interest costs and reduce over-reliance on one source of finding in line with the CIPFA Code.