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Issue - meetings

Treasury Management Performance

Meeting: 19/03/2024 - Audit and Governance Committee (Item 51)

51 Treasury Management Performance pdf icon PDF 656 KB


To report to the Audit and Governance Committee the quarter three Treasury Management Indicators as required by the CIPFA Treasury Management Code.



That the Audit and Governance Committee Resolves to:

a)    Note the contents of the report



Madhu Richards, Director of Finance

Georgina Dyer, Chief Accountant


Additional documents:


The Director of Finance introduced the report that outlined the quarter three Treasury Management Indicators as required by the CIPFA Treasury Management Code.

The report explained that the overall performance of investments in the 9 months to 31 December 2023 was positive, with a total return of £1,243,599 or 5.31% against an annual revenue budget of £1,102,228 and generating an unrealised capital gain of 3.26% or £403,652 in the year to date.

The capital value of pooled funds continued to be affected by prevailing economic conditions in the world markets. Pooled funds were intended to be long term investments where short-term fluctuations in the capital value were expected. These funds were being monitored closely by the Council’s Treasury Management adviser (Arlingclose) and they continued to forecast that the capital values would recover over the next 2-3 years as gilts and bond revenue rates start to decline again.

The Council had continued to benefit from higher revenue returns due to regular increases in the Bank of England Bank Rate to combat high levels of inflation. The Bank base rate reached  5.25% in August 2023 and had remained there to date.

The Council complied with most of the Prudential Indicators for 2023/24 as set out in the budget approved by full Council in February 2023. Further details could be found in the report with the exception to the Prudential Indicators being explained in 8.7.

At the Audit and Governance Committee meeting in November 2023, where the Treasury Management Mid Term Report was presented, the Committee requested information with regards to how ethical the Council’s investment portfolio was. This information was now included in Annex A.

Questions were raised by Members around ethical investments, particularly about ensuring the Council did not hold any Tobacco and Fossil Fuels investments. There was an understanding that this was a balancing between financial returns and ESG ratings.

It was therefore decided that a more comprehensive report on what sectors and companies’ investments that were held by the Council would come back to the Committee in a stepped and balanced approach. Once the information was brought back to the Committee, Members would make recommendations to the Executive if they felt it was necessary. Action Point: A more comprehensive report would be brought back to the next Committee meeting providing a stepped approach of what investments the Council held and what the probable financial impact could be.

RESOLVED that the Audit and Governance Committee AGREED to:

  1. Note the contents of the report.