Issue - meetings

That:

·       The committee is invited to note the Treasury Management Mid-Year Report 2025-26

The Treasury Management mid-year report is prepared in compliant with CIPFA’s Code of Practice on Treasury Management and covers performance against the Council’s Capital Strategy and Treasury Management Policy. The report is presented to the Audit Committee as the body delegated by Council to undertake the role of scrutiny of treasury management strategy and policies. The report covers the period from 1^st April to 30^th September 2025.

The Council receives Treasury Management Advice under a contract with Arlingclose limited.

Recommendation

The committee is invited to note the Treasury Management Mid-Year Report 2025-26.

The Chief Accountant introduced the report.

The Committee discussed the financial status and management of the Council’s borrowing and cash assets. Key points include concerns about the increase in borrowing by approximately £16 million, with specific attention to an £8 million external loan and the interest costs associated with it. Members questioned the rationale behind paying interest when the Council holds significant assets, suggesting that it may represent inefficient financial management. The officer explained that the loan was taken for specific projects, such as local authority housing fund schemes and the South Oxhey Leisure Centre, and that the interest rate of 2.41% is offset by higher returns on cash holdings, resulting in a net positive financial position. The discussion also covered the Council’s policy on cash holdings, highlighting a £10 million limit within banks to mitigate risk, with an emphasis on daily monitoring by the treasury team to avoid exceeding this limit. Questions about financial reporting transparency and the need for better documentation and annotations in reports were raised to aid scrutiny. Additionally, there was clarification on a finance lease liability of £46,365 million, which remains consistent across two fiscal years due to inflation adjustments.

Councillor Tony Humphreys moved the recommendation as set out in the report.

The Committee noted the report.

RESOLVED:

The committee is invited to note the Treasury Management Mid-Year Report 2025-26.