Issue - meetings

The report sets out the likely medium to long term borrowing requirement for the Council partly arising from that decision and reaffirms the Council‘s approach to borrowing as set out in the Treasury Management Strategy whilst highlighting the potential risks and benefits of various options.

RESOLVED:

(i)            Cabinet noted the Council’s balance sheet analysis and estimated borrowing need as set out in section 5;

(ii)          Cabinet approved the borrowing strategy as set out in the report including the commencement of negotiations to agree a forward funding loan of up to £40m. See section 6;

(iii)         Cabinet noted that the actions recommended above were within the operational boundaries already agreed by Full Council when setting the Treasury Management Strategy for 2018/19 as part of the budget setting process; and

(iv)         Cabinet noted that a copy of this report had been presented to the Audit and Standards Advisory Committee in July for review and consideration. The comments the Audit and Standards Advisory Committee were shown in paragraph 1.6.

Councillor Margaret McLennan, Deputy Leader of the Council, introduced the report stating that in February 2018, Cabinet endorsed an ambitious three-year (2018/19 - 2020/21) capital programme amounting to some £800m. This report sets out the likely medium to long term borrowing requirement for the Council partly arising from that decision and reaffirms the Council‘s approach to borrowing as set out in the Treasury Management Strategy whilst highlighting the potential risks and benefits of various options.

Councillor McLennan stated that, up to this point the Council had adopted the strategy of funding capital investment from internal cash balances and delayed entering into borrowing commitments. However, as explained throughout the report, this approach, which had been highly cost effective for the last few years, was no longer sustainable as in the short to medium-term the Council will need raise in the order of £230m additional finance to continue with its capital investment plans. Given the scale of the programme this was likely to be the biggest single financial transaction the Council will have undertaken in a generation.

RESOLVED:

(i)            Cabinet noted the Council’s balance sheet analysis and estimated borrowing need as set out in section 5 of the report;

(ii)          Cabinet approved the borrowing strategy as set out in the report including the commencement of negotiations to agree a forward funding loan of up to £40m, as detailed in section 6 of the report;

(iii)         Cabinet noted that the actions recommended above were within the operational boundaries already agreed by Full Council when setting the Treasury Management Strategy for 2018/19 as part of the budget setting process; and

(iv)         Cabinet noted that a copy of this report had been presented to the Audit and Standards Advisory Committee in July for review and consideration. The comments from the Audit and Standards Advisory Committee were shown in paragraph 1.6 of the report.