The Tandridge District Council Investment Sub Committee meeting on 14 June 2024 focused on the council's investment and borrowing positions, the Capital, Investment and Treasury Management Strategy for 2024/25, and updates on investment properties. Key decisions included noting the council's financial positions and recommending the approval of the 2024/25 strategy, subject to ratification by the Full Council.

Summary Investment and Borrowing Position at 31st December 2023

A report detailing the council's investment and borrowing status as of 31 December 2023 was presented. The report, which included analysis from Arlingclose, the council's treasury advisors, confirmed the following:

• Long-term treasury investments amounted to £10.8 million.
• Short-term investments totalled £20.5 million.
• Non-treasury investments, including capital loans to service providers and limited companies, stood at £16.5 million.
• Public Works Loan Board (PWLB) loans totalled £99.4 million, with £43.4 million for the General Fund and £56 million for the Housing Revenue Account (HRA).

The council's four investment funds—CCLA Property Fund, Schroders Credit/Bond Fund, UBS Multi Asset Fund, and CCLA Diversification Fund—were forecast to generate £649,000 in excess of the budget for 2023/24, despite a carrying loss of £1.3 million. The option of using the surplus to increase the Investment Performance Equalisation Reserve was discussed, with further advice from Arlingclose to be considered.

Arlingclose also commented on the proposed merger of CCLA's Diversified Income Fund with the Better World Cautious Fund, noting no major changes in risk or return. The discounted PWLB interest rate for the HRA and the council's ability to finance HRA loans via internal borrowing were also highlighted.

The committee resolved to note the council's investment and borrowing position, actual performance against the Treasury Management Strategy indicators, and the commentary from Arlingclose. The full report can be accessed here.

Capital, Investment and Treasury Management Strategy for 2024/25

The strategy for 2024/25 was presented, outlining how capital expenditure, financing, and treasury management contribute to the council's priorities. It included:

• Capital and investment overviews.
• A treasury management strategy statement.
• An investment property strategy.
• An unchanged Minimum Revenue Provision (MRP) policy statement.
• Principles of corporate governance for the capital programme.

David Green from Arlingclose provided an overview of national economic issues, including GDP and inflation analysis, and government consultations on new rules for MRP and increased flexibility for capital receipts.

The committee recommended the approval of the strategy, subject to ratification by the Full Council. The full strategy document is available here.

Investment Property Update

The committee moved into 'Part 2' to discuss commercial investment properties owned by the council and its subsidiary, Gryllus Properties. Updates included:

• 80-84 Station Road East, Oxted: Negotiations for a new lease with the existing tenant.
• 30-32 Week Street, Maidstone: Terms agreed on a new letting.
• Castlefield House, Reigate: Rent review due on 25 March 2024.

For Tandridge District Council properties:

• Quadrant House, Caterham Valley: Following ratification of the letting to McDonald's, work to mitigate potential impacts was discussed. The Principal Asset Manager will circulate a briefing note on draft Heads of Terms.
• Village Health Club, Caterham on the Hill: Confirmation of a £197,000 grant from Sport England's Swimming Pool Fund to offset increased energy costs.
• Council Offices, Oxted: Local agents instructed to market surplus space.

Further details on the investment property update can be found in the meeting minutes.