Issue - meetings
Treasury Management Mid-Term Report
Meeting: 27/11/2025 - Audit and Governance Committee (Item 95)
95 Treasury Management Mid-Term Report 
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Purpose:
To provide Members with an update on Treasury Management activity, the performance of internal and external funds and prudential indicators for the period 1st April 2025 – 30th Sept 2025
Recommendation:
That the Executive resolves to:
1. Note the contents of the report.
Additional documents:
Minutes:
The purpose of the report was to provide Members with an update on Treasury Management activity, the performance of internal and external funds and prudential indicators for the period 1 April 2025 – 30 Sept 2025.
Georgina Dyer, Head of Finance, introduced the report and highlighted the following points:
- Members were asked to note that the recommendation incorrectly referred to the Executive, in fact the Audit and Governance Committee was recommended to note the report.
- Long-term investment performance had continued the same trajectory as previously presented, with significant revenue returns and capital values that continued to recover.
- The Council was above budget in revenue terms, with interest receipts having provided more income to fund front line services of the Council.
- There was still some volatility in the market, particularly due to events in the US. Such volatility could impact the Council’s long-term investments but were outside of the Council’s control.
- The remainder of the report showed the position of the cash reserves.
- Treasury management prudential indicators were all compliant. The exception to this was interest rate exposure. Interest rates continued to be higher than forecast however, there was anticipation of a further interest rate cut by the Bank of England in the coming year.
In the discussion the following points were raised:
- A Member queried if the unrealised Capital Gain of £318,000 shown at 5.7 could be crystalised. In her response the Officer advised that it could not be realised until the asset was sold and noted that it was considered a long-term investment. The potential for unrealised gains to be crystallised when LGR took place was explored by the Committee, with Officers advising that this would be a matter for the new Shadow Authority and eventually the new Unitary Authority to consider. It was suggested that unrealised losses would only become an issue for finances if the Government withdrew the statutory override which was in place until 31 March 2028.
- The Committee discussed the interest rate exposure noted at 8.6 in the report. Further clarity was sought as to why this was noted as non-compliant. Officers informed the Committee that the indicator was set during the budget setting process and was in fact a measure and not to be viewed in terms of a “good” or “bad” result. Non-compliance in this case would be more of a concern if the Council had external debt and borrowing which it did not.
- The Committee queried whether consideration had been given in the Treasury Management Strategy to a move towards ethical social investments. Officers noted that this had been considered and would be included in future. Furthermore, an ethical fund had been opened recently. More detail would be available in the Treasury Management Strategy which would be presented to the Committee in January.
- The Council’s exposure to the recent central government budget announcement and subsequent market reaction was discussed. Officers suggested that at present there had been no noticeable market reaction but acknowledged that the Council was exposed to this.
- The Committee ... view the full minutes text for item 95