Agenda item

The Executive Member for Financial Sustainability presented the report. The report set out the Council’s investment programme, its financing and the process for developing new proposals. It was noted that it was reviewed annually to ensure transparency and compliance with statutory guidance. Capital spending remained low and was being funded mainly through new capital receipts. It was noted that projected debt levels were falling and were expected to continue to decline over the next three years, with a corresponding improvement in the impact on the revenue account.

Members heard that the Treasury Management Strategy, emphasised the need to manage borrowing, investments and cash flow prudently in line with CIPFA codes. It was noted that the proposed 2026/27 policy continued the approach used over previous years, ensuring borrowing for capital purposes was repaid over an appropriate period.

The Executive Member for Financial Sustainability

proposed the recommendations as detailed in the report.

The Executive Member for Neighbourhoods seconded the proposal.

In response to a question from a Member regarding two major Public Works Loan Board loans that were due for refinancing later in the year, officers advised that the Council had several loans, however the two large £25 million loans were due for refinancing in June and September 2026. Members heard that options would be explored with the Council’s treasury advisers, taking account of market trends and the likelihood of falling interest rates. Officers added that decisions would need to be made closer to the refinancing dates and would also have to factor in Local Government Reorganisation, as a new unitary authority might have cash reserves that could allow internal rather than external borrowing, which could be more beneficial overall.

Members observed that the Council’s debt had been steadily reducing and asked for context on how the Council had managed to bring debt down and whether any risks might reverse that trend. Officers explained that debt reduced each year because the Council set aside minimum revenue provision (MRP) of around 2% annually to repay it. They added that no new borrowing was planned, with future capital spending intended to be funded through capital receipts from asset disposals. This approach avoided increasing debt and therefore avoided higher MRP charges on the revenue budget, whilst ensuring existing debt continued to fall.

Members noted that the Council had reduced its debt by nearly £8 million in the year, which appeared to be more than the 2% annual reduction previously mentioned and suggested this showed strong performance. Officers explained that in addition to the standard 2% minimum revenue provision, the Council had also made a voluntary repayment relating to vehicles purchased for the waste service, funded through capital receipts from asset disposals.

In response to a request for clarification following a newspaper report suggesting that the Old River Lane public square had been deferred, Members heard that the project had not been postponed. It was explained that the capital budget had been realigned to reflect the expected timetable, with expenditure moved from 2026/27 to 2027/28 because progress depended on the developer’s pace. It was noted that the scheme had only recently submitted its planning application and could not proceed without permission. It was confirmed that the funding remained in place and that there was a strong intention to deliver the public square, subject to planning approval being granted.

The motion to support the recommendations, having been proposed and seconded, was put to the meeting and upon a vote being taken, was declared CARRIED.

RESOLVED – that (A) Executive recommends to Council that it approves the Capital Strategy, Minimum Revenue Provision Statement and the Treasury Management Strategy 2026/27, including the Prudential Indicators contained within the reports.