Decision details

Reasons for the Decision – The Local Government Act 2003 requires a local authority to have regard to the Prudential Code and to set Prudential Indicators for the next three years to ensure that its capital investment plans are affordable, prudent and sustainable. The Prudential Indicators are approved as part of the Medium Term Financial Strategy (MTFS).  The Treasury Management Strategy is a key element of the MTFS as the planned capital expenditure programme drives the borrowing required.

Decision – (a) That, in accordance with the regulations, it be recommended to the County Council, at its meeting on the 17 March 2016, that the Annual Investment Strategy (AIS) 2016/17 (detailed in paragraphs 24 to 67 and Appendices 2 and 4of the report) be adopted.

(b)That, as required by guidance, the following policies (as described in paragraphs 91 to 100 to the report) be approved;

i) reviewing the strategy;

ii) the use of external advisers;

iii) investment management training; and

iv) the use of financial derivatives.

(c)That the proposed borrowing strategy for the 2016/17 financial year comprising:

• the use of cash in lieu of borrowing required in 2016/17;
• the use of cash to repay loans early, subject to market conditions;
• as a contingency the ability to borrow new loans as a result of;
  • unexpected changes in the capital programme;
  • a reduction in the level of cash balances; or
  • the repayment of LOBO’s;
• a forward borrowing strategy that will not be used in 2016/17; and
• a loan rescheduling strategy that is unlimited where this re-balances risk,
• The above to operate within the prudential limits set out in Appendix 5 to the report and in consultation with the Deputy Leader and Cabinet Member for Strategy, Finance and Corporate Issues with respect to early loan repayment, raising new loans and loan rescheduling;

be approved.

(d) That, in accordance with the regulations, it also be recommended to the County Council that the Minimum Revenue Provision (MRP) policy 2016/17 (as summarised in paragraphs 101 to 103; and as set out in full at Appendix 8 to the report), be adopted.