Mr Kevin Bartle, Interim Divisional Director for Finance, Procurement and Audit firstly apologised for the late production of the report. He said this had been for a number of reasons but was mainly due to the impact of the 2018/19 accounts not yet being completed which had ‘knocked on’ to the production of the Treasury Management Strategy Statement

Mr Bartle highlighted the key points of the Treasury Management strategy and referred Members to paragraph 3.20 which outlined the main change to the strategy. Mr Bartle said the Council and its treasury management advisors, Arlingclose had agreed to use a slightly different methodology for selecting counterparties to invest with. The council would use credit ratings provided by Fitch, Moodys and Standard & Poors to derive its selections. He said this would give treasury management staff the ability to invest more efficiently given the new approach but it would not make investing more risky

In response to questions from Members the following was noted:

·         Mr Bartle confirmed using the credit agencies’ ratings would mean that if the credit rating changed for an investment, treasury management staff would have the authority to pull out of the investment. There would continue to be an upper limit on all investment types.

·         In response to if there would be penalties for early withdrawal from deposits, Mr Bartle confirmed there would be

·         Councillor Wood asked what control process was in place, when loans were made to charities. Page 36, supplement agenda. He said grants are considered by the Cabinet’s Grants Determination Sub-Committee but what happens to loans? Mr Neville Murton, Corporate Director for Resources responded stating the charity would need to make a business case and must satisfy the criteria when applying for a loan. However there was no reporting process in place for this to be referred to a committee. Ms Asmat Hussain, Corporate Director for Governance added this would be an officer decision and would be published on the Council’s website.

·         Councillor Francis enquired if the Audit Committee would receive reports to vary the Treasury Management Strategy like the one the Committee considered earlier this municipal year. Mr Murton confirmed that this would be the case. He explained where a commercial opportunity existed and the Council wanted to invest in it, it would require the Committee’s approval.

o   ACTION: Members of the Committee requested training in relation to the Treasury Management Strategy. Mr Bartle confirmed this would form part of the annual induction training for Members.

The Chair thanked Mr Bartle for the report.

The Audit Committee RESOLVED to:

1.    Approve and adopt the following policy and strategies:

a)    The Treasury Management Strategy Statement contained in Appendix A;

b)    The Investment Strategy contained in Appendix B;

c)    The Capital Strategy Report contained in Appendix C;

d)    The Prudential and Treasury Management indicators contained in Appendix D; and

2)    Note that the Approved Limit for loans to local charities for service purposes of £0.6m was exceeded by £0.4m in 2019/20, as the approved limit did not consider a pre-existing loan to one charity, as set out in section 3.5 of the Investment Strategy, Appendix B. This limit has been suitably adjusted.