Issue - meetings

Report No: CAB/JT/18/052

Portfolio Holder: FHDC Cllr Stephen Edwards

Chairman of the Committee: FHDC Cllr Louis Busuttil

Lead Officer: Gregory Stevenson

RECOMMENDED TO FHDC COUNCIL: (19 December 2018)

That, subject to the approval of Council, the Mid-Year Treasury Management Report 2018-2019 and Investment Activity (1 April to 30 September 2018), being Report No: PAS/FH/18/040, be approved.

(Report No: CAB/JT/18/052)

The Joint Committee received this report which provided information on the Council’s Mid-Year Treasury Management Report and also summarised the investment activities for the period to 30 September 2018.

The total amount invested at 1 April 2018 was £16.005m and at 30 September 2018 was £19.800m.  The increase in balances over the period was due primarily to timing differences in respect of the collection of local taxes, the payment of precepts and changes in the profile of the Capital Programme.

The 2018/19 Annual Treasury Management and Investment Strategy (Report No: PAS/FH/18/009) set out the Council’s projections for the current financial year.  The budget for investment income in 2018/19 was £224,000, which was based on a 0.75% target average rate of return on investments. 

As at the end of September 2018, interest actually earned during the first six months of the financial year amounted to £62,722  (average rate of return of 0.676%) against a profiled budget for the period of £112,000; a budgetary deficit of £49,278.  The budgetary deficit was due to lower cash balances as a result of re-phasing of some income generating projects.  These projects were budgeted to be funded through external borrowing which would have temporarily boosted the cash balances and resultant interest.  In addition, investments were made on a shorter term basis for liquidity resulting in lower yields.

The report also included assumptions on borrowing for capital projects included within it.  The borrowing was based around seven specific projects as per their agreed business cases.  The report included a summary of capital borrowing budget 2018-2019, and a summary of capital borrowing for quarter two.  As at the end of Quarter Two, there had been no requirement to borrow externally over and above the £4.0m Barclays loan.  Therefore the only interest payable for this quarter was the £169,000 relating to this.

RECOMMENDED TO FHDC COUNCIL: (19 December 2018)

That, subject to the approval of Council, the Mid-Year Treasury Management Report 2018-2019 and Investment Activity (1 April to 30 September 2018), being Report No: PAS/FH/18/040, be approved.