Agenda item

Draft Capital & Treasury Management Strategy


As set out within the Corporate Plan, the Council has ambitious plans for the city, and the Capital Programme is a key enabler in delivering against this. The current programme is due to end in March 2023, with a new five-year programme commencing in 2023/24. The new programme predominantly comprises of annual recurring allocations and a number of ongoing schemes carried forward from the existing programme.


The report includes both the Capital and Treasury Management Strategies which, at their core, (i) confirmed the Capital Programme, as part of the Capital Strategy and (ii) the various borrowing limits and other indicators which govern the management of the Council’s borrowing and investing activities, as part of the Treasury Management Strategy.


The Capital Strategy also sets out the long-term context (10 years) in which capital decisions are made. It demonstrates that the Council’s approach to taking capital and investment decisions is in line with service objectives, whilst giving consideration to risk, reward and impact. It also demonstrates that these decisions are taken whilst having proper regard to stewardship of public funds, value for money, prudence, sustainability and affordability.

The capital plans of the authority are inherently linked with the Council’s treasury management activities and, therefore, the Treasury Management Strategy is included for consideration alongside the Capital Strategy.

The main points arising from the two strategies are highlighted in this covering report, and essentially states that the proposed programme is affordable and provides headroom  for borrowing. Much of the strategy is signed off by full Council, and the Committee is being asked to consider and comment on the report before a final version of the report is considered by Cabinet.

Comments of committee:


Dr Barry fully supported the report and positively endorsed the content.


Councillor Cocks considered that the report well written and was a good summary of complex information. Cllr Cocks asked what the impact of inflation in construction would have on outstanding commitments such as school Band B projects, which had not yet started and other outstanding commitments such as the Transport Bridge and Capitol Region City Deal.  The Assistant Head of Finance advised that with regard to budget, allocation would be made with an eye on inflation, however, until they went to tender, the costs were not fully confirmed. The management of existing projects would also be considered. The Welsh Government had indicated an openness to discussion regarding aspirations under the Capitol Region programme.


The Chair asked if Councils shared pots of money in relation to the slippage issue relating to building projects. The Head of Finance stated that he was not aware that such arrangements existed. The Chief Accountant and Project Manager advised that if there was a surplus cash balance and another authority required this, then they could potentially be treated as an investment counter party but this was not done on a project by project basis although those complexities existed. The Chief Accountant and Project Manager remarked that often Welsh Government funding is paid in arrears, after the spend has been incurred. 



The Committee

§  Received and endorsed the Capital Strategy (Appendix 2), including the draft new Capital Programme within it (shown separately in Appendix 1) and the borrowing requirements/limits to deliver the new programme.

§  Received and endorsed the Treasury Management Strategy and Treasury Management Indicators, the Investment Strategy and the Minimum Revenue Provision (MRP) for 2023/24 (Appendix 3).

As part of the above, the Committee

§  Noted, and commented on the debt, and corresponding revenue cost of delivering the new Capital Programme, and the implications of this over the short and medium-long term with regard to affordability, prudence and sustainability.

§  Noted and commented on the Head of Finance recommendation to Cabinet and Council that borrowing needs to be limited to funding ongoing and previously approved schemes brought forward from the current Capital Programme only, and the recommended prudential indicators on borrowing limits to achieve this.

§  Noted and commented on the proposal to prioritise annual sums funding over any new schemes, unless unavoidable.



Supporting documents: