Agenda item

The Chartered Institute of Public Finance and Accountancy (CIPFA) Treasury Management in the Public Services: Code of Practice requires the Authority to approve a Treasury Management Strategy before the start of each financial year, review performance during the year, and approve an annual report after the end of each financial year. This report provides a review of performance to 31 March 2023.

Steve Finnegan, Financial Accountant, introduced a report which informed the Committee that the Chartered Institute of Public Finance and Accountancy (CIPFA) Treasury Management in the Public Services: Code of Practice required the Authority to approve a Treasury Management Strategy before the start of each financial year, review performance during the year, and approve an annual report after the end of each financial year. The Authority’s Investment position as at 31 March 2023 was set out in Appendix 2. The report provided a review of performance to 31 March 2023. The Committee was asked to note the report.  The following comments were raised:

·       It was noted that the report had already been considered by the Authority’s main Committee whereas the Audit Committee would normally have first sight of the report.  This had been due to the local elections held in May 2023 and the process of reconstituting the Committee following those elections.  It was noted that the normal timetable of reporting should now commence;

·       It was noted that the large balance of cash holdings was mainly down to receiving grants at the start of the financial year and received in advance of the Authority needing to spend the specific grant;

·       It was asked whether the Authority was confident that none of its investments were with Belarus, Russia or fossil fuels.  It was noted that the Authority’s investments were in accordance with advice from the Authority’s Treasury Management advisors Arling Close who had not expressed any concerns.  The opportunity for further green investments was slightly higher for pension funds.

NB: Subsequent to the meeting the following note was circulated to the members of the Committee:

“we have double checked the guidance we received last year relating to Belarus from our Treasury Advisors ArlingClose (which included both Russia and Belarus).  We can confirm that on our pooled funds and money market funds no direct exposure to Russian or Belarusian assets had been identified within the MMFs, cash plus funds and strategic pooled funds that feature as part of their advice. ArlingClose remained comfortable with clients continuing to use these funds.”

·       It was asked whether comparative figures from previous years could be included in future reports;

·       Risks were managed through regular meetings with the treasury advisors.  The Authority worked on a basis of safety first and returns second.  The Authority was also mindful of possible changes to International Reporting Standard 9 as previously reported to the Committee;

·       It was confirmed that there were allowances made in the project plans to allow for inflation but there would still be some impact.  Everybody in the supply chain would need to help absorb some of these pressures.  The Committee asked for a workshop/informal session to assess the impact of inflation on delivery of services;

·       A question was asked about emergency funding and whether this could be used for bus services.  In response it was noted that the main BSIP funding came with significant vale for money requirements and any changes to the terms and conditions of this grant had to be approved by the DfT.  There was ongoing dialogue between the minister and the Metro Mayor.  The grant was 14 months into its 36 month length and all had to be allocated by 2025.  Members stated that any workshop arranged on funding sources, inflation risk and assessment of projects could maybe use this as a particular case study if useful.

Resolved:

That the Treasury Management Outturn Report to 31 March 2023, prepared in accordance with the CIPFA Treasury Code of Practice and the Treasury Management Indicators to 31 March 2023, be noted.