Agenda item
Treasury Management Report for 2019-20
Minutes:
Mr Kevin Bartle, Interim Divisional Director for Finance, Procurement and Audit presented both reports. Mr Bartle said he would talk about the 2019/20 report before the mid-year report for 2020/21. He said the reports contained a lot of detail on the treasury management activity that had taken place and therefore he would give assurances around the key indicators.
Mr Bartle said all the indicators had been met for the outturn and mid-year Treasury Management reports, as shown in the summaries of the reports. He said the Treasury Management Strategy Statement (TMSS) as approved by Council was being complied with and the Finance Team was keeping a close eye on investment returns because of the bank base rate being at a historic low. He said this could impact significantly on treasury management returns.
In respect of credit worthiness of investments, Mr Bartle stated this was at a satisfactory level despite the investment quality being lower than desired. He referred to the pooled investments funds and said the value of these had nominally dropped from £76M to £69.4M. Mr Bartle said that given the fluctuations in the stock markets, due to the pandemic, these long-terms investments have recovered in 2020/21 and are now back up to £73M.
Mr Bartle continued stating that from a budget perspective, the targets for income budgets on investment income were being met, despite the difficult time they faced with low interest rates. Lastly Mr Bartle pointed out the Capital Financing Requirement (CFR) had been changed, in line with the changes made to the Capital Programme.
In response to questions from members the following was noted:
· Councillor Wood referred to Croydon Council and their Section 114 declaration. He said whilst he appreciated Tower Hamlets was not in the same position, the Committee ought to look at the issues raised. He said there had been a drop in financial investments from March 2019 to September 2020, and whilst the Council was spending more, there was still a lot of money left. He recommended that a future meeting the Audit Committee look at lessons to learnt from the Croydon example.
o ACTION: The Chair agreed the Committee would examine the lessons learnt from Croydon Council’s situation at a future meeting. She asked Mr Kevin Bartle, Interim Divisional Director for Finance, Procurement and Audit and Ms Asmat Hussain, Corporate Director for Governance to take this forward.
The Audit Committee RESOVLED to NOTE the recommendations in the Treasury Management Mid-Year Report of 2020-21 in so far as:
- Note the contents of the treasury management activities and performance against targets for the half year ending 30th September 2020; and
- Note the Council’s investments as set out in Appendix 1. The balance outstanding as at 30th September 2020was £180.90m.
AND NOTE the recommendations in the Treasury Management Report 2019-20 in so far as:
- Note the contents of the treasury management activities and performance against targets for the year ending 31st March 2020; and
- Note the Council’s investments as set out in Appendix 1. The balance outstanding as at 31st March 2020 was £257.750m.
Supporting documents: