Decision details

The report of the Head of Treasury Services was submitted, informing Members of the overall performance for the 2008-2009 financial year and the position regarding investments and borrowings at 31 March 2009.

Scrutiny Committee – Resources considered the report at their meeting on 17 June 2009 and the support and comments of members were noted.

Executive was pleased to note that the Fund Manager had returned an overall rate of return of 7.15% on managed cash funds for 2008-09 compared to a benchmark return of 3.74%.  Members were reminded that the Fund Manager would be attending the Members’ Briefing on 9 September to talk about the Investment Strategy and Ethical Investment.

The Head of Treasury Services updated Executive on the position with regard to the Icelandic bank investments. The Local Government Association’s legal advice had placed local authority deposits as “priority claims”. As such, it was anticipated that 100% of the Glitnir investment would be returned and 83% of the Landsbanki investment. It was hoped some interest may also be payable.

A Member queried the role of the in-house team in respect of the Investment Strategy and was assured that officers worked within strict parameters. Members supported the request of Scrutiny Committee –Resources that the Leader and Chair of that Committee should be kept informed of any significant issues which arose. In response to a query regarding the split of investment between banks, the Head of Treasury Services advised that it was good practice to spread the risk.

The Chair acknowledged that all investment which made acceptable returns carried intrinsic risk and that the Council’s prudent Investment Strategy had underpinned the Council’s ability to deliver quality services whilst keeping Council tax rates at the 5^th lowest level in the country.

Executive recommended that the Treasury Management report for the 2008-2009 financial year be noted.