Issue - decisions

Treasury Management Policy

11/03/2020 - Treasury Management Policy 2020/21

RECOMMENDED to Council:

(a) that the upper limit for principal sums invested for longer than 365 days contained in paragraph 4.7 of the attached Treasury Management Policy Statement be approved;

(b) that the upper and lower limits on the maturity structure of borrowing contained in appendix 5.1 of the attached Treasury Management Policy Statement be approved;

(c) that the attached Treasury Management Policy Statement including the Treasury Management Strategy and Annual Investment Strategy for 2020/21 be approved;

(d) That the Council will where it is financially responsible to do so, give preference to investments that improve the environment, bring wider social benefits, and are with organisations with good governance. In particular the Council will:

(i) Avoid investments in fossil fuel extraction unless they are making substantial investment into renewable energy technologies as part of a strategy to become a clean energy supplier;

(ii) Consider the environmental, social and governance elements of credit ratings in making investment decisions, provided that the overall risk profile of the investment portfolio (including liquidity risk) and returns are not compromised;

(e) that rated building societies be given the same lending limits as banks;

(f) that the Council will only lend to housing associations if they have a viability rating of V1 and a Governance rating of G1 from Homes England;

(g) (i)   that lending to Hampshire Community Bank (HCB) will be secured on loans made by HCB to small and medium sized enterprises (SMEs) of the highest credit quality which may not in turn be secured on tangible fixed assets;

(ii)        That loan advances to HCB in accordance with (g) (i) above will be subject to individual approval by Cabinet

(h) that the maximum duration of loans to HCB be reduced from 10 years to 5 years;

(i) As set out in paragraph 1.4 of the Treasury Management Policy Statement, the Director of Finance and Resources (Section 151 Officer) and officers nominated by him have delegated authority to:

(i) invest surplus funds in accordance with the approved Annual Investment Strategy;

(ii) borrow to finance short term cash deficits and capital payments from any reputable source within the authorised limit for external debt of £883m approved by the City Council on 11th February 2020;

(iii) reschedule debt in order to even the maturity profile or to achieve revenue savings;

(iv) to buy and sell foreign currency, and to purchase hedging instruments including forward purchases, forward options and foreign exchange rate swaps to mitigate the foreign exchange risks associated with some contracts that are either priced in foreign currencies or where the price is indexed against foreign currency exchange rates;

(j) that the Director of Finance and Resources (Section 151 Officer) has the power to delegate treasury management operations to relevant staff;

(k) that the Chief Executive, the Leader of the City Council and the Chair of the Governance and Audit and Standards Committee be informed of any variances from the Treasury Management Policy when they become apparent, and that the Leader of the City Council be consulted on remedial action (paragraph 1.2.2 of Treasury Management Policy Statement).

 

(This is referred to Council and is not subject to call-in)