Agenda and minutes

Any Member who is substituting for another Member should so indicate, together with the name of the relevant absent Member.

There were no substitutes declared.

There were no apologies for absence received.

Councillor Patricia Warby nominated Councillor Sarah Broughton as Chairman.  This was duly seconded by Councillor David Roach, and with the vote being unanimous, it was

          RESOLVED:

That Councillor Sarah Broughton be elected Chairman of the Sub-Committee for 2018-2019.

Councillor Sarah Broughton then took the Chair for the remainder of the meeting.

To confirm the minutes of the meeting held on 21 January 2018 (copy attached).

The minutes of the meeting held on 22 January 2018, were confirmed as an accurate record and signed by the Chairman.

Members of the public who live or work in the Borough are invited to put one question / statement of not more than 3 minutes duration relating to items to be discussed in Part 1 of the agenda only.  If a question is asked and answered within 3 minutes, the person who asked the question may ask a supplementary question that arises from the reply.

A person who wishes to speak must register at least 15 minutes before the time of the meeting is scheduled to start.  There is an overall limit of 15 minutes for public speaking, which may be extended at the Chairman’s discretion.

There were no questions/statements from members of the public.

Report No: TMS/SE/18/003

The Sub-Committee received Report No: TMS/SE/18/003 which:

(a)         Presented the Council’s Annual Treasury Management Report, summarising the investment activities for the year 2017-2018; and

(b)         Provided a summary of the investment activities for the first three months of the 2018-2019 financial year.

(a)    Annual Treasury Management Report 2017-2018

The Council’s Annual Treasury Management Report for 2017-2018 was attached as Appendix 1 to Report No: TMS/SE/18/003.  The report included tables which summarised the interest earned during 2017-2018 on the various treasury investments held by the Council; investment activity during the year and investments held as at 31 March 2018.

The budget income from investments in 2017-2018 was £253,000 (average rate of return 0.55%).  Interest actually earned during the year totalled £292,825 (average rate of return of0.571%); an over-achievement in interest of £39,825, and an over-achievement of 0.021% on average rate of return.  The over-achievement of interest earned was primarily due to higher cash balances being held during the year than originally budgeted for.

The Sub-Committee scrutinised the Annual Treasury Management Report 2017-2018, and asked questions to which responses were provided.

In response to a question raised regarding the over-achievement in interest earned, member were informed that a key contributor was on money held to support the Councils capital programme.  To try and overcome timing issues, officers were carrying out profiling work to phase out capital spend across a projects life rather than to place it all into the first year of the project. 

It was proposed by Councillor David Roach, seconded by Councillor Patricia Warby and with the vote being unanimous, it was

            RECOMMENDED:

That the Annual Treasury Management Report 2017-2018, attached as Appendix 1 to Report No: TMS/SE/18/003, be approved

(b)    Investment Activity 1 April to 30 June 2018

The total amount invested at 1 April 2018 was £36.35m and at 30 June 2018 it was £40.15m.  The increase in balances over the period was due primarily to timing differences in respect of collection of local taxes; Council Tax and Non-Domestic Rates and payments of precepts i.e. to Suffolk County Council, Suffolk Police and central government.

The 2018-2019 Annual Treasury Management and Investment Strategy Statements sets out the Council’s projections for the current financial year.  The budget for investment income in 2018-2019 was £308,000 which was based on a 0.70% target average rate of return on investments.

At the end of June 2018, interest earned during the first quarter amounted to £68,693 (average rate of return 0.636%) against a profiled budget of £77,000 (average rate of return 0.70%), creating a budgetary deficit of £8,306.  The deficit related to lower than anticipated interest rates offered by lenders. 

The Service Manager (Finance and Performance) explained that the Council’s Treasury Advisors had advised on increasing the interest rate to 0.70%.  However, the Council was currently not meeting that rate, but officers were working towards achieving this.

The report also included for the first time, assumptions on borrowing for capital projects included within it.  The borrowing was based around four specific projects as per  ...  view the full minutes text for item 79.

The next meetings of the Sub-Committee have been set for:

Monday 19 November 2018; and  

Monday 21 January 2019.

Both meetings commencing at 10.30am.

The Sub-Committee noted that the next meetings of the Sub-Committee would be held on Monday 19 November 2018 and Monday 21 January 2019.  Both meetings to commence at 10.30am.