Decision details

Treasury Management Report - Quarter 1

Decision status: Recommendations Approved

Is Key decision?: No

Is subject to call in?: No


Cabinet had approved the Council’s 2019/20 Investment Strategy in February of this year; this required regular reports to be presented to the Audit and Standards Committee on the Council’s treasury management activities. Investment activity was also reported to Members through the monthly Members’ Bulletin.  In managing its treasury management activities, the Council followed the Chartered Institute of Public Finance and Accountancy’s (CIPFA) Code of Practice on Treasury Management (revised 2017). 


The report provided an update on a number of areas as follows:


           The Council’s treasury advisors, Link Asset Services, had provided their view on the current economic climate and their outlook for the remainder of 2019/20, which was appended to the report. 

           The Council made its own investments through the use of call and deposit accounts with major financial UK institutions.  The Council had also invested £5 million in the Churches, Charities, Local Authorities’ (CCLA) Property Investment Fund.  A further £3 million was invested in the HERMES Property Investment Fund. 

           The Council held £25,366,860 of investments at 31 May 2019. The total income from investments was estimated at £85,270 compared to a profiled budget of £85,000; the average rate of return was 1.67%. 

           During 2018/19, the Council maintained an under-borrowed position.  This meant that the capital borrowing need, (the Capital Financing Requirement), was not fully funded with loan debt, as cash supporting the Council’s reserves, balances and cash flow was used as an interim measure. This strategy was prudent as investment returns were low and minimising counterparty risk on placing investments also needed to be considered.

           The Council’s treasury management debt and investment position was organised by the treasury management service in order to ensure adequate liquidity for revenue and capital activities, security for investments and to manage risks within all treasury management activities. Procedures and controls to achieve these objectives were well established both through Member reporting, detailed in the summary, and through officer activity detailed in the Council’s Treasury Management Practices.

           The Council had invested in regeneration of Rother through its Property Investment Strategy and the expected income from these non-Treasury Investments was provided within the report.

           Current property investments provided a net rental income of £970,000 per annum, a net income of £1,331,308 to date.


The Council’s current treasury management and investment strategies remained robust in managing the Council’s cash funds. The economic outlook remained difficult for a net investor such as the Council and supported the Council’s financial strategy to reduce reliance on investment returns.


RESOLVED: That the report be noted.

Publication date: 13/03/2020

Date of decision: 31/07/2019

Decided at meeting: 31/07/2019 - Audit and Standards Committee

Accompanying Documents: