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Issue - meetings

Treasury Management Mid-Year Report

 

 

Meeting: 21/01/2026 - Council (Item 68)

68 Treasury Management Mid-Year Report pdf icon PDF 1 MB

Purpose:

To receive and discuss details of the Council's Treasury Management performance for the period 01 April to 30 September 2025 and Quarter 2 Treasury Management Prudential Indicators.

 

Recommendations:

That Council resolves to:

1.    Note the Council’s Treasury Management performance for the period 1 April 2025 to 30 September 2025 and the Quarter 2 Prudential Indicators.

2.    Approve the Treasury Management Mid-Year Report 2025/26

 

Additional documents:

Minutes:

The purpose of the report was to allow Members to receive and discuss details of the Council's Treasury Management performance for the period 01 April to 30 September 2025..

 

Cabinet Member for Finance, Councillor Patrick Coleman, introduced the Treasury Management report for the first six months of the financial year. It was noted that the report showed a broadly positive position, although future financial uncertainty remained.

 

Members were advised that the statutory override for externally managed pooled investments had been extended for a further four years beyond 31 March, which was beneficial given the Council’s investment holdings of £10.5m in strategic pooled funds, primarily held for income generation. Some capital growth had been achieved during the period, and overall trends were reported as positive.

 

The presence of the Deputy Chief Executive Officer was noted for the purpose of responding to technical questions.

 

The Chair thanked Councillor Coleman and invited questions for clarification.

 

Clarification was sought regarding the Council’s pooled fund investments with reference to recent volatility in global stock markets. Questions were asked as to what extent the Council actively managed its pooled funds and whether the Council relied on external consultants to rebalance or switch investments in response to market movements, or whether management of the funds was undertaken on a more passive, “light-touch” basis.

 

Councillor Patrick Coleman noted that the question was helpful in improving members’ understanding of financial markets. He observed that there was a distinction between stock market movements and pooled fund performance and suggested that the relationship between these investment types would be best explained by the Deputy Chief Executive Officer.

 

The Deputy Chief Executive Officer, explained that the Council’s pooled fund investments were detailed in Table 5 on page 49 of the public report and advised that these investments were held for the long term, typically over a five-to ten-year period, and that the decision to invest in specific funds had been made by Council some years previously. Any change to those investments would require a further Council decision.

 

Members were cautioned that past performance was not a reliable indicator of future performance and it was highlighted that there were costs associated with changing investments and changes should not be undertaken lightly. He noted that the initial investment of £12.5 million had reduced in value to £11.686 million as of 30 September 2025, and that selling and reinvesting would crystallise that capital loss.

 

It was further clarified that the Council undertook regular reviews, with support from its advisers, to ensure the investment portfolio remained diversified across different asset classes, including property funds, income-maximising funds, and multi-asset funds. This approach reduced exposure to any single market or fund. He advised members to note current performance and confirmed that the Audit and Governance Committee could provide further assurance regarding the robustness of the investments.

 

It was noted that the Council’s Treasury Management Risk Reserve had been established approximately 18 months earlier to manage the risk associated with the statutory override relating to pooled fund valuation losses.  ...  view the full minutes text for item 68

Meeting: 21/11/2024 - Audit and Governance Committee (Item 308)

308 Treasury Management Mid-Year Report pdf icon PDF 994 KB

Purpose

To receive and discuss details of the Council's Treasury Management performance for the period 01 April to 30 September 2024 and Quarter 2 Treasury Management Prudential Indicators.

 

Recommendation

That the Audit and Governance Committee resolves to:

1.            Consider the Council’s Treasury Management performance for the period 1 April 2024 to 30 September 2024 and the Quarter 2 Prudential Indicators and recommended to Council for approval.

Additional documents:

Minutes:

The Deputy Chief Executive Officer introduced the Treasury Management Mid-Year Report and compared the position with the equivalent report from a year ago. Inflation was now lower but was forecast to be above the Bank of England’s target of 2% for most of 2025. The average rate of return on the Council’s investments was 4.68% compared to 4.78% last year on a broadly similar level of investments. Treasury returns were projected to be above the budgeted level by c. £376,000 on the expectation that the Bank of England’s Base Rate would remain unchanged until at least February 2025. The statutory override on unrealised capital losses was due to end on 31 March 2025 and, if it is not renewed by the government, the Council would have to ensure it had adequate reserves and balances in order to finance capital losses whether they were realised or unrealised. The economic forecast in Annex A had been prepared before the recent US election.

 

The Committee questioned whether returns were being maximised and requested an overview of Treasury Management from the Council’s advisors Arlingclose. The Deputy Chief Executive said that the Council had a diversified portfolio of investments and that security and liquidity rather than yield were the primary considerations.

 

That the Audit and Governance Committee resolved to:

  1. Note the Council’s Treasury Management performance for the period 1 April 2024 to 30 September 2024 and the Quarter 2 Prudential Indicators
  2. Recommend the Treasury Management Mid-Year Report to Council for approval.

 

 

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