Issue - meetings
Annual Treasury Management Strategy and Annual Non-Treasury Investment Strategy 2025/26
Meeting: 28/01/2025 - Audit and Governance Committee (Item 318)
318 Annual Treasury Management Strategy and Annual Non-Treasury Investment Strategy 2025/26 
PDF 537 KB
Purpose
The Council is required to approve a Treasury Management Strategy and Non-Treasury Investment Strategy (Investment Strategy) for 2025/26 before 01 April 2025.
The attached Treasury Management Strategy Statement (TMSS) for 2025/26 (Appendix 1), Non-Treasury Investment Strategy (Appendix 2) and Minimum Revenue Provision (MRP) Statement (Appendix 3) is prepared in accordance with CIPFA’s “Prudential Code” and the “Treasury Management Code of Practice” (2021 editions), and the Ministry of Housing, Community and Local Government (MHCLG) revised guidance on Local Government Investments.
Recommendation
That the Committee resolves to:
1. Consider the draft Treasury Management and Non-Treasury Investment Strategy for 2025/26 and provides feedback to the Cabinet and Council for consideration as part of the Council’s budget setting process.
Additional documents:
- Appendix 1 Annual Non Treasury Management Investment Strategy draft, item 318
PDF 634 KB
- Appendix 2 Annual Treasury Management Strategy - Draft, item 318
PDF 1 MB
- Webcast for Annual Treasury Management Strategy and Annual Non-Treasury Investment Strategy 2025/26
Minutes:
The report invited the Committee to consider a Treasury Management Strategy and Non-Treasury Investment Strategy (Investment Strategy) for 2025/26 for adoption before 01 April 2025. The Treasury Management Strategy Statement (TMSS) for 2025/26 (Appendix 1); Non-Treasury Investment Strategy (Appendix 2) and Minimum Revenue Provision (MRP) Statement (Appendix 3) were prepared in accordance with CIPFA’s “Prudential Code” and the “Treasury Management Code of Practice” (2021 editions), and the Ministry of Housing, Community and Local Government (MHCLG) revised guidance on Local Government Investments.
Deputy Chief Executive reiterated the apology already made by email for the late arrival of the reports.
It was noted that the final report would be going to Council on 24 February and that the reports presented to the Audit & Governance Committee were draft reports reflecting the emerging position on the Budget and the Capital Programme.
The draft Treasury Management Strategy (TMS) outlined how the Council intended to manage and invest its surplus cash and the principles upon which it may seek to borrow or how it would make investment decisions. It set out how the decisions would be reported to the Audit and Governance Committee.
It was noted that treasury management is determined according to SLY principle: security, liquidity, yield, in that order.
The TMS described a diversified portfolio including both short and longer-term investments, with an estimated total investment of £27.5m for the forthcoming financial year.
The IFRS 9 statutory override, set to expire on 31 March 2025, would require councils to account for unrealised losses on pooled funds, impacting financial flexibility. The Council would have to show adequate resources to mitigate the balance sheet situation for March 2026.
The current Medium Term Financial Strategy (MTFS) indicated a potential need for borrowing in 2027/2028. Borrowing would only proceed if necessary, with alternative options, such as generating capital receipts or reviewing expenditure, to be considered to reduce or eliminate the need for borrowing.
Non-Treasury Investment Strategy was also considered, setting out the approach, the limits and the risks. The role of Corporate Governance including the Audit and Governance Committee was highlighted and the requirement for non-treasury investment to be proportional was underlined.
The Committee considered the report and did not provide any feedback.
Councillor Mike Evemy, Cabinet Member for Finance and Transformation arrived as an observer during the course of this item.