The Treasury Management Statement set out the Council’s treasury issues and looked to ensure that the Council met its spending obligations.  The Council was required to receive and approve a minimum of three main reports each year to include:

1)         Prudential and Treasury Indicators and the Treasury Strategy;

2)         a Mid-Year Treasury Management Report; and

3)         an Annual Treasury Report.

These reports incorporated a number of policies, estimates and actuals which were scrutinised by the Audit and Standards Committee prior to making recommendations to Council.

The Treasury Management Strategy detailed the Council’s capital issues and reviewed the position regarding investments, borrowing strategy, economic outlook and policies on the creditworthiness of counterparties.

The Annual Investment Strategy detailed the Council’s investment priorities, promoting security, liquidity and investment return.  In order to minimise risks, the Council stipulated the minimum acceptable credit quality of counterparties for inclusion on the lending list.

The 2021/22 draft Revenue Budget presumed an income of £326,000 from treasury activities, which assumed a return of 0.018% from deposit type investments and 4.08% return from property fund investments.  The forecast for the next five years continued to see low returns, based on the forecast use of cash reserves to support the Revenue Budget.  The expectation was that 2021/22 would remain a very difficult investment environment, however the strategies proposed in the report, together with the interest rates forecast, were in line with the assumptions made when preparing the 2021/22 Revenue Budget. The costs of treasury operations were contained within the 2021/22 draft Revenue Budget. 

RECOMMENDED: That:

1)         the Treasury Management Strategy as set out at Appendix A to the report be approved and adopted;

2)         the Annual Investment Strategy as set out at Appendix B to the report be approved and adopted;

3)         the Minimum Revenue Provision Policy Statement 2021/22 be approved;

4)         the Prudential and Treasury Indicators as set out in Appendix A to the report be approved; and

5)         authorised limits in this report be approved.