Issue - meetings

Purpose: To consolidate the investment and borrowing strategy for the year ahead by detailing how and where the Council will invest and borrow in the forthcoming year, within a particular framework. This strategy is monitored throughout the year, with a mid-year report going to the Governance Committee as well as an annual report being presented to Members.

Council considered a report (Agenda Item 5) concerning the Treasury Management and Investment and Borrowing Strategy for 2026/27.

MOTION: Proposed by Councillor Iain Cottingham and seconded by Councillor Jeff Brooks:

“That Council approves and adopts the proposed Investment and Borrowing Strategy for 2026/27.”

Councillor Cottingham introduced the report and highlighted that it was critical for the Council to manage risk in a prudent way and that the report clarified where the Council would borrow and invest its money to meet its cash flow requirements. He also provided some examples of the rigorous treasury management controls proposed, such as that the Council would keep a weighted average of £10m in liquid cash throughout the financial year and that no more than 30 per cent of its borrowing would be short term (i.e. less than one year). In addition, the report clarified that the High Needs Block and EFS projections for borrowing would remain below their boundary levels for 2026/27, but that the impact of the recently announced Government reforms to SEND and the High Needs Block had not yet been quantified due to the limited time between their announcement and this meeting.

Members noted that the capital programme would be funded through external borrowing, internal cash, and capital receipts received from the divestment of assets – disposal of the commercial property portfolio, along with Public Works Loan Board (PWLB) support, would also be used to fund the Grazeley Solar Farm Project which would, in turn, also support the Council’s net zero policy. The weighted cost of borrowing for the Council was just under 3.7 per cent, with the current PWLB rate being around 5.4 per cent. Overall, the aim for 2026/27 was to keep the cost of borrowing below 4.2 per cent.

Some Members criticised the disposal approach taken by the Administration, highlighting a point raised by CIPFA that it could cost the Council over £1m per year in lost revenue. Others criticised the nature of the commercial property portfolio itself, stressing that residents of West Berkshire expected the Council to be investing in the district, not in other areas across the country. In response, it was mentioned that the property portfolio policy had been devised and implemented by the previous Conservative Administration, and that the current Administration’s policy was of disposal. Although they would do this at speed, they did not want it to come at the expense of cementing a loss on the properties.

A point was made that the property portfolio had remained largely unchanged since 2023, despite claims that disposals were funding the transformation programme. Councillor Cottingham then clarified that these figures were not up to date, and that the properties in Guisborough had been disposed of.

Overall, as Council considered that the Investment and Borrowing Strategy was prudent and capable of supporting the Capital programme, they agreed to approve the recommendations.

The motion was put to the meeting and duly RESOLVED.