Date: 25 November 2016
Meeting of the Council
Monday, 5 December 2016 at the rising of the Extraordinary meeting which commences at 6.35pm
Council Chamber, Town Hall, Warrington
Steven Broomhead Chief Executive ______
Agenda prepared by Sharon Parker, Councillor Services Manager – Telephone: (01925) 442161, Email: [email protected]) ______
Note: There will be a minutes’ silence to be observed in memory of former Mayor, Jim Hayes who died recently. This will be followed by a few words from Councillor Sheila Woodyatt.
1. Apologies
2. The Minutes of the Council
To be moved by the Mayor and seconded by the Deputy Mayor:
That the Minutes of the meeting of the Council held on 17 October 2016 be agreed as a correct record.
3. Correspondence from the previous meetings
4. Code of Conduct – Declarations of Interest Relevant Authorities (Disclosable Pecuniary Interests) Regulations 2012
Members are reminded of their responsibility to declare any disclosable pecuniary or non-pecuniary interest which they have in any item of business on the agenda no later than when the item is reached.
The Head of Legal and Democratic Services and Monitoring Officer to the Council or representatives in Democratic and Member Services are available prior to the meeting to advise and/or to receive details of the interest and the item to which it relates.
Declarations are a personal matter for each Member to decide. Whilst officers will advise on the Code and its interpretation, the decision to declare, or not, is the responsibility of the Member based on the particular circumstances.
5. Civic Mayor’s Announcements
6. The Leader’s Announcements
Questions to the Leader
There is an opportunity for Members to ask questions of the Leader on his announcements. Each Question will last no longer than 2 minutes except with the consent of the Mayor. The whole period for dealing with questions to the Leader will be capped at 15 minutes as contained in the Council Procedure Rules 13.1 b.
7. To receive Reports from the Executive Board and the Council’s Committees
7.1 Council Treasury Monitoring 2016-17 Mid Year Review
Report of the Audit and Corporate Governance Committee
Proposed by Cllr C Fitzsimmons Seconded by Cllr C Froggatt
8. Questions Received from Members of the Public
In accordance with Standing Order 13.12 -13.25 questions from the public must be received by the Head of Democratic and Member Services by 12 noon on Monday, 28 November 2016. No more than three questions shall be addressed and no person or body or organisation may submit more than one question at any one meeting. A time limit of five minutes shall apply per question to cover the asking of the question, the response and any supplementary question and response. Responses will be given either orally or in writing.
The Mayor will invite the questioner to put the question to the Councillor nominated to answer it. The Mayor may receive one supplementary question, which must be related to the original question.
Should any questions be received after the date of agenda issue but prior to the closing date for receipt of questions further details will be provided.
Question 1 from Ms Pritchard
A recent petition, with the full backing of Cllr Hans Mundry, was established to support the proposal of a pedestrian crossing outside Winwick Church of England School. Could Warrington Borough Council outline their proposed actions in response to this clearly identified need to improve pedestrian safety?
9. Questions from Members of the Council
In accordance with Standing Order 13.1 – 13.10 Questions must be received by the Head of Democratic and Member Services, in writing by 5.00pm on Tuesday, 29 November 2016. The time allowed at Council meetings for asking and responding to a question including any supplementary questions should normally be five minutes.
Should any questions be received after the date of agenda issue but prior to the closing date for receipt of questions further details will be provided.
Council Procedure 13.5 - Questions are to be taken on a rotation basis between the Political Groups starting with the opposition groups and individuals. Once each group has asked their first question the process will be repeated until the time limit for questions at paragraph 13.9 has expired. Questions for each group or individual are to be taken in the order that they are received by the Head of Democratic and Member Services following the procedures in paragraph 13.4.
Within Council Procedure Rule 13.9 there will be a cap set at 30 minutes for dealing with questions from Members. Any questions put to the meeting but not answered within the 30 minute timescale a written response will be provided. All questions will be taken as read.
Note: Questions received to date are attached below. They are listed in the order in which they were received. The order of questions will be determined after the deadline for receipt of questions, 5.00 pm on Tuesday, 29 November 2016.
Question 1 from Cllr Woodyatt In the light of the worrying press reports can the relevant portfolio holder give a reassurance to the relatives of elderly persons in Warrington care homes that the quality of care is high and that they will not be denied access to their loved ones or even worse, they will be told they have to leave the home with a few days’ notice?
Question 2 from Cllr Woodyatt Why did Councillor Mundry and his team impose a damaging parking regime in Lymm without any consultation?
Question 3 From Cllr M Smith
Following the recent HS2 route announcement, please could the leader outline the steps being taken by the Council to convince the secretary of state that the Golborne link is not required and that the Government should pursue a solution which benefits Warrington without the local detriments inherent in this proposal.
10. Motions
In accordance with Standing Order 15, motions must be delivered to the Head of Democratic and Member Services by 9.30am on Friday, 25 November 2016.
Motion 1
Proposed: Cllr Pat Wright
Seconded: Cllr Tony Williams
This council:
Notes with deep regret that the Conservative Chancellor's Autumn Statement was silent on any plans by the Government to address the enormous funding pressures on Warrington BC's and other local authorities' adults Social Care budgets amounting to £23m since 2011;
Notes that the current Government and the previous Coalition Government's failure to properly fund social care has in turn added significant pressure to Warrington's already stretched local NHS services; and
Calls on the Government to ensure that social care is adequately and fairly funded in Warrington so that the elderly and the most vulnerable in society can get the care and support they need.
Motion 2
Proposed by: Cllr Bob Barr Seconded by: Cllr Ian Marks
Devolution Decision This council recognises that the decision to accept devolved powers from central government, as part of any combined authority, is of great long term strategic importance to Warrington.
The council resolves that the decision to accept any devolution deal will be debated, and voted upon, by the entire Council at an Extraordinary Meeting.
11. Petitions
Report of the Chief Executive
Petition 1 - Parking Charges in Lymm and Stockton Heath Car Parks
Five minute presentation – petition organiser Fifteen minute debate by Council
Petition 2 – Keep Lymm Library Open Five minute presentation – petition organiser Fifteen minute debate by Council
Petition 3 – Save Warrington Libraries Five minute presentation – petition organiser Fifteen minute debate by Council
MEETING OF THE COUNCIL – 17 October 2016
Present: The Mayor (Councillor F Rashid)
Councillors: B Axcell, B Barr, R Bate, D Bennett, M Biggin, R Bowden, K Buckley, P Carey, H Cooksey, M Creaghan, J Davidson, A Dirir, L Dirir, C Fitzsimmons, J Flaherty, G Friend, C Froggatt, J Grime, J Guthrie, S Hall M Hannon, S Harris, J Hart, T Higgins, A Hill, W Johnson, D Keane, A King, R Knowles, S Krizanac, T McCarthy, B Maher, I Marks, C Mitchell, L Morgan, K L Morris, H Mundry and K Mundry, P Nelson, T O’Neill, S Parish, H Patel, D Price, R Purnell, M Smith, M Tarr, P Walker, G Welborn, J Wheeler, T Williams, P Wright, S Woodyatt and S Wright.
C 44 Apologies
Apologies were received from Councillors J Carter, T Jennings, J Kerr-Brown, M McLaughlin
C 45 The Minutes of the Council
Resolved: That the Minutes of the ordinary and extraordinary meetings of the Council held on 5 September 2016 were agreed as a correct record.
C 46 Correspondence from the Previous Meetings
Noted.
C 47 Code of Conduct – Declarations of Interest
Items 8 and 10 (Motion 2)
Cllr J Guthrie declared a non pecuniary interest as her husband was the Deputy Chair of LiveWire. Cllrs Tarr and Flaherty declared a non pecuniary interest as Directors of LiveWire.
C 48 Civic Mayor’s Announcements
The Mayor made the following announcements: 6th September he was privileged to be part of an event with Warrington Disability Partnership to mark 25 years since the first article relating to WDP’s involvement in disability access matters appeared in the Warrington Guardian.
Saturday 10th September was Warrington’s Heritage Day. This was an opportunity for the towns’ historical buildings to be opened to the public for them to visit and enjoy. A number of people visited the Town Hall and had a tour of the building..
The 11th September saw the Sikh Community of Warrington host a charity event in support of the Mayor’s charity appeal.
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On 13th September, the Mayor and Mayoress were delighted to assist Warrington Charities Trust with their cheque presentation to charities across the town which had been chosen to receive a donation from the trust.
On 14th September the Mayor had the opportunity to visit Optionis, based on Centre Park, where he presented a number of apprentices with their Level 2 AAT Certificates.
Following on from this, on the 15th September the Mayor supported Warrington’s Annual Careers Fayre at Orford Jubliee Hub.
Also, on the 15th September, the Mayor and Mayoress attended the graduation presentation for young people who had taken part in the National Citizenship Scheme.
The Warrington Festival took place over the weekend of 16th – 18th September and the Mayor was involved with a number of events, including 'Braziliant' – a Paralympics Sports Festival for mainstream primary schools which was organised by Warrington Wolves Foundation.
The Mayor and Mayoress also attended the Bewsey & Dallam Fun Day and met with many valuable volunteers of the community and were able to join in on a great day. On Sunday 18th September, they were delighted to be able to start the Warrington Half Marathon.
On the 18th September the Mayor hosted an event fo his charity appeal at Wasabi Teppenyaki in Stockton Heath.
During mid September the Mayor was able to take some time with his family and have a short break in Wales. During his time away, the Deputy Mayor and Deputy Mayoress – Councillor Les Morgan and his wife Gwyn, kindly attended a number of engagements on his behalf. These included a Citizenship Ceremony that welcomed new British Citizens to the town, an open day at Greencore Prepared Meals to help get people back into work and a celebration service to mark the beginning of Warrington Street Pastors. Back from holiday, on 25th September the Mayor and Mayoress were honoured to be part of Warrington Islamic Associations Eid Celebration Day.
On Monday 26th September, the Mayor was pleased to host his first Mayor’s Achievement Awards at the Town Hall. He stated that to be among so many community champions and volunteers who were an inspiration and asset to the community was brilliant and congratulated every nominee. This type of event showed there was so much potential in the town and so many unsung heroes.
On the 27th September the Mayor hosted a visit of a number of service users who were overcoming drug or alcohol addiction and being supported by Pathways. The work of Pathways was to be applauded and the Mayor hoped that the group would continue to make good progress.
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On the 28th September the Mayor helped to promote the UK Trade Investment Export Hub which stopped off at Victoria Park. The hub provided information to businesses that were interested in exporting to other countries and the benefits that exporting could bring. It was very informative and was great to see the Warrington business community getting involved.
The Mayor was at Victoria Park on 29th September to support a charity football match arranged by local technology distribution company Flex. The game was against stars from the soap Hollyoaks and staff from Flex and was to raise funds for Claire House Children’s Hospice. The Mayor stated it was a great evening with lots of local community groups involved.
On 30th September the Mayor and Mayoress visited Orford Art Group for Older People which was funded by Cheshire Community Foundation.
During the first weekend of October the Mayor and Mayoress helped to support the Duke of Lancaster’s Regimental Weekend. They felt privileged to sit at the top table at the Regimental Dinner held at the Masonic Hall and met with Captain Michael and Colonel Chris Owen and members of the regiment who were all wonderful people. On Sunday 2nd October, the Annual Regimental Service and Parade took place at St Elphins Parish Church, followed by the traditional parade along Church Street.
On Monday 5th October the Mayor was invited to take part in the Lymm ‘ROC’ Conversation. Standing for ‘Redeeming Our Communities’ this event was an opportunity for local residents to celebrate existing good work in the community, discover gaps and plan to bridge gaps in communities. The event enabled residents to share best practice to help benefit the residents of the area.
On Friday,7th October the Mayor and Mayoress were delighted to attend a dinner to celebrate a local Warrington company – ICC Solutions, based at St James Court – receiving ‘The Queens Award for Enterprise in International Trade’. This was a highly coveted corporate award that the company had received for the second time which recognised the outstanding contribution they were making to the British economy. Dave and Wendy Maisey who set up the business were an inspiration to the business world and they had proven that with ambition, hard work and dedication - success and recognition was achievable.
The Mayor stated that Warrington Wolves had made it through to the Grand Final at Old Trafford on 8th October and was sure that many fellow Councillors were also there to support the team. Although the result wasn’t in Warrington’s favour, it was great to see the team so well supported by fans that created a fantastic atmosphere during the game.
The Deputy Mayor and Deputy Mayoress again supported by attending some engagements on the Mayor’s behalf during early October, including the Older Peoples Day Celebrations at the Gateway, starting off the Stroke Association Resolution Charity Run at Victoria Park and the Warrington Masonic Group Annual Church Service of Thanksgiving and Rededication at St Elphins Parish Church. The Mayhor very much appreciated the support of the Deputy Mayor and Deputy Mayoress in attending these engagements.
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On Monday 10th October, the Mayor was invited to support officers of Warrington Borough Council at their stall in Golden Square to promote awareness of World Mental Health Day. The Mayor met with some fantastic people who helped to support those with mental health issues.
On the 11th October the Mayor went to support Warrington Town Football Club at their match against Buxton. The game was great to watch, and Warrington won 1 – 0. The team were doing well so far this season and the Mayor hoped their success would continue.
The countdown to Christmas officially began after the Mayor and Mayoress officially opened the Christmas displays at Bents Garden & Home.
During the remainder of the week in October, the Mayor and Mayoress visited the Pyramid to take part in the Accent Music Hub Social Evening where they watched a performance piece which the group had performed at Wembley Arena with schools from Halton. This was a great event and they were impressed with the talent of the children. On 14th October the Mayor was honoured to open the new Barrowhall Primary School. The facilities at the new school were brilliant and it was fantastic that this highly populated area of Warrington had a new school.
On the evening of 14th October, the Mayor and Mayoress attended the Warrington Disability Partnership 25th Anniversary Ball.
On Saturday 15th October the Mayor and Mayoress visited the Real Ale Shack that was located within Warrington Retail Market to present them with an award from CAMRA to celebrate them becoming North Cheshire Area Pub of the Autumn Season. It was great to meet the team who worked there and hear about how the business was going from strength to strength.
On Sunday 16th October the Mayor and Mayoress went to Liverpool Cathedral to join the High Sheriff of Liverpool for the annual judge’s service. They thoroughly enjoyed the service and catching up with other Mayors from across the North West. Following this event, they went to the Park Royal Hotel to support them with their Asian Wedding Fayre.
The Mayor stated he had a busy time ahead, with the launch of the first ever Warrington’s Got Talent competition taking place on 18th October, he was excited about finding Warrington’s star and meeting talented people along the way.
The Mayor had also recently launched the first ever ‘Mayor’s Music Competition’ which with the help of Accent Music Education Hub, were looking to celebrate Warrington’s young musicians and showcase their talents.
Further details about both events were available on the Mayoral webpages https://www.warrington.gov.uk/mayor
The Mayor took the opportunity to invite members to the annual Remembrance Service and Parade that would take place on Sunday 13th November at Warrington
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Cenotaph at Bridge Foot. Members were asked to arrive at the Cenotaph by 10.30 am.
C 49 The Leader’s Announcements
The Leader made the following announcements:
Solicitor to the Council The Leader stated that that this was the final Council meeting before Timothy Date left the Council on 11 November. Tim began working as a trainee at Norfolk County Council in 1981. He had a variety of jobs in the West Midlands before moving to Bradford in 1987; this was followed by a move to the North West in 1998 when he became head of legal services at Liverpool City Council. He then worked for Greater Manchester Waste Disposal Authority from 2005 until finally coming to Warrington in 2009.
On behalf of all Members, the Leader wished to place on record their thanks to Tim for all the help and support he had given to Members and Officers in his time in Warrington and wished him well for the future.
Business Improvement District (BID) BIDs have been developed across the UK since legislation was first introduced in 2004, and these have been seen to work well in neighbouring towns and cities. With the level of investment that the Council was making in its town centre, the time was right to consider how such a BID may work for Warrington. An initial consultation process had recently concluded with a select number of businesses in the town centre to obtain a preliminary understanding of the appetite for a Business Improvement District. The outcome had indicated that there was a real appetite for a BID and that further private investment could be made as a result that would complement the Council’s investment regeneration and programme. A BID could prove to be an important step in realising the Council’s vision of making Warrington one of the best towns in the UK in which to live, work, shop and relax.
Stadium Quarter Improvements The business incubator, The Base and the adjacent University Technical College, which opened in September, have made a marked change for the better in the landscape on Dallam Lane and Foundry Street at the Stadium Quarter. Work was now well underway to make highway and pedestrian footpath improvements to Foundry Street and the underpass connection to the bus interchange. This would transform the look of the area and was a further example of the Council’s commitment to deliver a central business district at the Stadium Quarter.
University Technical College (UTC) Warrington UTC Warrington proudly opened its doors in September with its innovative vocational learning offer to 14 to 19-year-olds specialising in energy & engineering. 200 students have now joined and were already reaping the benefits of working and studying with employers from across the borough who themselves have already provided several masterclasses to students at the college. The UTC building makes a striking architectural addition to the Stadium Quarter and is a good indicator of what the Council's regeneration plans can deliver in this area of the town centre.
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Omega Developments continued apace at Omega. It was easy to forget how far this landmark project had come. Only three years ago Omega was an empty site; now it supported thousands of jobs and was home to a growing hub for logistics and manufacturing businesses in the North West and was contributing massively to the Northern Powerhouse. In addition, the news of Domino’s Pizza coming to Omega marked yet another manufacturer on site; it showed just how effective this growing business community was at stimulating further growth and investment for Warrington. The new Barrow Hall Community Primary School also opened its doors at the start of the school term in September.
Local Plan Review The Leader stated that the Council were formally kicking off the review of Warrington's Local Plan. The Executive Board had agreed the preparation programme and the level of growth we were aiming to plan for. At the end of this month, the first stage of consultation would begin. All the background research undertaken to date would also be published. This was an important plan for Warrington and it would establish the shape of the place for the next 20 years and would set out the framework for Warrington New City. This was the statutory Development Plan for the Borough. The Leader encouraged members to engage in the process. All the documents would be available on the council's website for Members to read and the Planning Policy and Programmes team were organising a Members 'drop-in' session for Wednesday, 2 November to answer any queries. The aim was to have the new Local Plan adopted by mid-2018.
Warrington Festival The Warrington Festival proved to be a huge success with a month of exciting cultural and entertainment events. On stage at Bank Park were Go West, Nik Kershaw and T’Pau for an 80s spectacular. Starsailor also performed on an evening which featured a special tribute to Viola Beach.
There was more to the festival than music though - with the English Half Marathon, a funfair, cycle festival, walking festivals and even movie screenings at Bank Quay Station.
Apprenticeships On Monday 3 October, the Leader met with eleven of our most recent successful Apprentices, to celebrate the completion of their apprenticeship frameworks with the Council.
The Council Apprenticeship programme, which had been running since 2013 in its current form, continued to go from strength to strength with 32 apprentices currently employed by the council.
The Leader congratulated all those present and confirmed that plans would ensure the programme continued to offer people an opportunity to build their career at the Council and become a valued member of the workforce and the community of Warrington.
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Questions to the Leader
Cllr Barr asked the Leader questions on the following:
UTC (University Technical College) – concern whether the facility was providing opportunites for all students not just the more able?
Requirement that all Executive Board announcements be provided at the same time as the Leader’s to allow members to read them?
Could the Constitution be amended to allow for the Leader to be questioned on any matter not just those contained in the Leaders Announcements?
The Leader responded that the UTC stemmed from the Skills Audit in 2013 which identified a skills gap in heavy engineering. For more details he would ask the relevant team to provide further information.
The timing of announcements from the Executive Board was a matter for individual portfolio holders but he would speak to them about.
Questions could be asked on any matter through the provision of written questions being sent in advance of the meeting.
C 50 Amendments to the Taxi Licensing Policy
Council received a report of the Chair of Licensing Committee, Councillor B Maher which sought approval of the amendments to the Taxi and Private Hire Licensing Policy, as recommended by the Licensing Committee on 5 July 2016. It was proposed by Cllr B Maher and seconded by Cllr P Nelson and it was resolved that Council adopt the changes proposed to the Taxi/Private Hire Licensing Policy as set out in appendix 1 of the report.
Reason for Decision: To allow the Licensing Authority to improve the taxi/private hire licensing service and provide clear guidance in the Taxi/Private Hire Licensing Policy to the key stakeholder (taxi/private hire trade, vehicle examiners at Netweok Warrington, members of the Licensing Committee and Licensing Officers.
C 51 Questions Received from Members of the Public
Question 1 - To Councillor T Higgins, Culture, Leisure & Community from Nicola Baird In the light of the public outcry regarding Livewire's consultation proposals, will the Council confirm that they will direct Livewire to come up with a completely new set of proposals that do not include the closure of Warrington's libraries?
Councillor Higgins responded that the consultation period on library proposals had been extended to 21 October.
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Once the consultation was concluded, LiveWire would prepare a report and recommendations to the Council. All the feedback would be considered before making any decisions.
As a supplementary question Cllr Higgins was asked how the Council was going to meet its legal requirements of providing a comprehensive library service?
Cllr Higgins responsed that the consulation was ongoing and he had no further information at this stage.
Question 2 - To Councillor T Higgins, Culture, Leisure & Community from Hilary Moors Given that Library visits per 100,000 in population were increasing from 2007/8 to 2011/12, and have declined by 25% since Livewire then took over, meaning Library engagement is now far lower than the North-West average, what will the Council do to ensure that any modernisation increases engagement and what will the Council do to assess whether Livewire is fit to run the Library service in future?
Councillor Higgins responded that participation had been decreasing nationally in recent years. The brief to LiveWire was to put forward proposals that increased participation in library services and ensured that services were easily accessible. Engagement in reading and learning was one of the principles of the modernisation programme.
The Council has robust contract monitoring procedures in place and LIveWire’s performance was reviewed on a quarterly basis.
As a supplementary question Ms Moors asked Cllr Higgins given that the only detailed proposal on the table was a significant threat to 9 of our 11 libraries, including the closure of 5 and removal of the lending element of the historic central library to a shoe shop, how will the Council ensure they meet their legal requirement under section 7 of the "Public Libraries and Museums Act 1964 to "provide a comprehensive and efficient library service for all persons desiring to make use of..[it]?” “Under the Equality Act 2010, public authorities must consider how they could positively contribute to the advancement of equality. Case law indicates that these assessments should be done before and at the time a policy decision is under consideration. As a person who is registered blind/severely sight impaired, Ms Moors was extremely disappointed to find out that no such assessment has been carried out as part of this consultation given that the Public Sector Equality Duty clearly states that equality duty should be integrated into the day to day business of public authorities. As there has been no consideration of the impact of the proposed changes on individuals with the 9 protected characteristics identified within the Equalities Act 2010 and the Public Sector Equality Duty, will the council ensure that any revised proposals are subject to a full and proper public consultation to fulfil their duties under the Equalities Act 2010 and Public Sector Equality Duty legislation?" Cllr Higgins stated that he would provide a written response to Ms Moors on the Council’s obligations relating to the Equality Act 2010.
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C 52 Questions from Members of the Council
Question 1 – To Cllr T Higgins from Cllr J Wheeler Will the Executive Member responsible for libraries confirm what he said in an email to me that he has not attended any of the Livewire consultation sessions?
Councillor Higgins responded positively
Cllr Wheeler asked as a supplementary question whether Cllr Higgins was aware that the savings associated with the library were disproportionately high and whether he had recommened them?
Cllr Higgins stated that the savings were in the budget report of 2016.
Question 2 – To Cllr H Patel from Cllr A King What is the feedback from the Council’s Planning for ‘Local Democracy Week’?
Councillor Patel responded that getting involved in local democracy was really important; it was the best way for local people to have their voices heard about local issues. What activities were planned across the town for encouragement of their input on local issues and what about encouraging young people to engage and take part in events.
The Council has a proud record of supporting local democracy week and in previous years local schools, colleges and youth groups have played a prominent part.
In keeping with this tradition, a number of events were planned to take place during this week. A full programme and press release were to be issued for example Executive Board colleagues were to join members of IMPACT to discuss the top five topics drawn from more than 5,000 responses from secondary school pupils: The Living Wage; Curriculum for Life; Transport; Mental health and discrimination.
It was also recognised that local democracy happened day in, day out, all year round. Local Democracy Week offered an opportunity to note the considerable engagement through social media over the past 12 months, for example efforts to increase voter registration, and to announce that over the next 12 months the Council would be maximising the potential of social media to bring more people in touch and involved with decision-making at the town hall.
Successive Mayors have been a part of this process, embracing digital technology and using it to continuously engage local communities in the democratic processes.
Cllr Patel was working closely with an officer task group led by the Deputy Chief Executive to devise an annual schedule of ‘democracy matters’ projects to encourage community involvement in the democratic processes.
Question 3 – To Cllr H Mundry from Cllr B Axcell Swing Bridge The Highways England Design manual for Roads and Bridges contains the standard 'BD 87/05 - Maintenance of Steelwork'. Clause 2.5 details the failure
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categories of the existing protective system when the need for maintenance painting has been established. Arguably the three swing bridges over the Ship Canal fall into Category IV, the worst category. Clause 2.7 refers to the need to carry out a comprehensive overall survey. Clause 2.2 states that it is false economy to delay maintenance work.
Can the Executive Member responsible for Highways and Transportation confirm that the Manchester Ship Canal Company (Peel Ports) is abiding by the standards laid out in this manual and let us know the frequency of inspection and examination of the bridges?
Cllr H Mundry responded that The Design manual for Roads and Bridges BD 87/05 - Maintenance Painting of Steelwork was split into sections with some areas boxed and others in open text. The sections in boxes were elements with which the owner or designing organisation must comply and open text contained advice as explained in Clause 1.1
Although Clause 2.5 detailed the failure categories of the existing protective system, the paint condition was categorised after the need for maintenance painting was identified by the owner or overseeing organisation. This was not done the other way around as there were many other factors which needed to be considered prior to painting including environmental risk near water courses and buildings etc.
Clause 2.7 did outline the need to undertake a comprehensive overall survey for all categories of failure. However, this was in the case of producing a Pre- Specification for actually undertaking works and should not be confused for routine General Inspections or Principal Bridge inspections.
The four categories of failure were to standardise pre- contract procedure, maintenance, accessibility, environment, expected life of the structure, cost, including road user delay cost and delays to traffic.
Although Clause 2.2 outlined that if appropriate maintenance was delayed, the cost of restoring the structure to a satisfactory standard may increase rapidly. However, this was an advisory statement and no bridge owner or overseeing organisation could be forced to maintain his paint work if they choose not to do so as the actual condition beneath will not be known without appropriate surveys.
With regard to whether Manchester Ship Canal Company (Peel Ports) was abiding by the standards laid out in this manual and letting the Council know the frequency of inspections and examination of the bridges, Cllr Mundry felt that they were.
Local Authorities worked within a Code of Practice, (Management of Highway Structures) to oversee, structures which formed part of the highway network. The Code set down appropriate levels of inspection to which a highway authority might exercise in these situations. Swing Bridges and High Level Bridges should be inspected once every two years under a General Inspection regime and once every six to ten years under a more detailed Principal Bridge Inspection regime. If the bridge owner wished to deviate from the Code, he was required to confirm his intention to do so and seek approval from the Local Authority as a departure.
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Information was provided to Warrington Borough Council in respect of Inspections undertaken by Peel.
Although structures over, under or aligned with highways may appear to be in poor condition, it was extremely difficult to confirm this without the appropriate level of expert inspection. Unfortunately, flaking paint, dull colour schemes and poor aesthetics were unacceptable characteristics but visual unattractiveness does not mean the bridge was out of specification or was at risk of failure. Any responsible bridge owner would undertake appropriate inspections to determine overall condition, identify appropriate repairs and suitable maintenance regimes.
As a supplementary question Cllr Axcell asked if the Council ensured that Peel Ports complied with the Standard?
Cllr Mundry confirmed that Peel Ports were complying with the Standard.
Question 4 - To Cllr T Higgins from Cllr J Grime Considering the need to look at the cases of individual libraries and the impact of closure on local communities, will Councillor Tony Higgins agree to meet with the ward councillors involved to hear their views and discuss practical ways forward?
Cllr T Higgins responded that he was happy to meet when the process was finished.
As a supplementary question Cllr Grime asked for a summary of the decision making process and the role of full Council.
Cllr Higgins said he would provide a written response.
Question 5 – To Cllr J Guthrie from Cllr S Krizanac Fracking When can we expect a recommendation from the Fracking Task Group and will it affect the Council's planning policies?
Cllr J Guthrie responded that the Task Group was called the Shale Gas Executive Board Task Group and had been set up earlier that year. She stated that the Council was awaiting the outcome of the Lancashire Application. This had recently concluded and the Council was now looking at all the evidence. At the moment the Council had no planning applications on this matter and she reminded Cllr Krizanac there was still a duty for each application to be taken on its merit.
As a supplementary Cllr Krizanac said that it was difficult to understand why so little had been done when there was a lot of work to be completed. When can members expect to be consulted on the matter.
Cllr Guthrie responded and referred to the points that she had already made and stated that she would make the information available at the appropriate time.
Question 6 - To Cllr Bowden from Cllr H Patel
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Please can the relevant portfolio holder give an update on how the Tory Governments policies are impacting on our overall budgets and our ability to support vulnerable young people?
Cllr Bowden responded on the cuts to the Council’s budget that had been made since 2011. The Council’s system of budget production was now based on Outcome Based Budgeting (OBB) and this had identified the need to protect vulnerable people. Previously spending on social care was 22% of the revenue budget and today it was 70%. It was important that the Council gained the best outcomes for those vulnerable people and looked toward creativity and innovation to maximise the use of resources without passporting the cuts to residents.
Question 7 – To Cllr J Guthrie from Cllr S Krizanac Westbrook Centre Is there a Council Local Plan for Westbrook that will guide its development as a district centre?
Cllr J Guthrie responded that Westbrook was designated as a district centre and Cllr Krizanac could have a copy of the document if he wished to have sight of it. The proposals were to support the vitablity and viability of the centre.
As a supplementary Cllr Krizanac asked why the Westbrook centre was not as diverse as Birchwood?
Cllr Guthrie stated that Westbrook and Birchwood could not be compared as they were not the same and one had been created as part of the New Town Development
Question 8 – To Cllr H Mundry from Cllr J Wheeler Gulleys and Gutters How often does the Council inspect and clear roadside gulleys and gutters?
Gully Cleansing & Street Sweeping of Roads Councillor Mundry responded that In Warrington carriageways and gullys were cleansed according to the road classification and its use on a scheduled basis.
Gully Cleansing
The authority had over 50,000 Gullys across the authority and aimed to cleanse gullys based on the following frequencies:
Road gullies on A Roads 2 times per year Road gullies on B Roads once per year Road gullies on C & Unclassified Roads once every 3 to 5 years
Street Sweeping of Roads
Main Roads
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Main roads on average were cleansed every 10 weeks and minor through routes every 12 weeks. During periods of leaf fall this would reduce whilst resources were prioritised on this activity
Where cars were parked, it was not always possible to sweep or cleanse around them, in particular where there is a risk of damage to the parked car.
Residential areas
Residential roads were mechanically swept two to three times per year where required.
The Council no longer had the capacity to operate outside of the schedule unless there is an immediate health or safety risk.
Question 9 – To the relevant Portfolio Holder from Cllr S Krizanac Youth Zone What progress is being made on the proposal to build a Youth Zone in Warrington and what is the timescale?
Cllr O’Neill stated that a written response would be provided in Cllr Carter’s absence.
Question 10 – To Cllr Guthrie from Cllr B Barr Air Quality Is air quality being monitored outside all Warrington schools?
Cllr Guthrie provided details of how air quality was monitored throughout Warrington. Information had been provided to the Department for Environment Food and Rural Affairs (DFRA) and no issues had been raised on the Council’s approach. No schools had been over the required standards.
Cllr Barr asked as a supplementary whether the Council should monitored the air quality outside schools?
Cllr Guthrie stated that the review had not identified any schools.
C 53 Motions
Motion 1
Proposed by Cllr S Woodyatt Seconded by Cllr K Buckley
“In view of an increase in the reporting of racist incidents and hate crime in the press this Council condemns racism, xenophobia and hate crime. We will work together to ensure there is no such prejudice in our community of Warrington, that all residents are able to live together in harmony and are tolerant of racial and religious differences.”
Motion put to the vote and was CARRIED.
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Motion 2
Proposed by: Cllr Bob Barr Seconded by: Cllr Judith Wheeler
The value of libraries to the community This council recognises Warrington’s heritage as the home of the country’s first public lending library and its status as having a highly performing low cost library service according to statistics from CIPFA.
We also recognise the value of libraries which provide:
The opportunity to browse, compare, refer to and borrow a wide selection of fiction and non-fiction books. Locations where children and young people can individually or collectively be introduced to the pleasure of reading, Places that reduce social isolation, promote social mobility and encourage life-long learning. Locations that bridge traditional media and the digital world and provide digital mentoring. This Council therefore affirms its commitment to work with partners, as appropriate, to ensure that the people of Warrington continue to benefit from the full range of advantages that libraries provide, wherever possible, in locations that are locally accessible.
Motion put to the vote and was CARRIED.
C 54 Boundary Commission – Parliamentary Proposals
Council received a report of the Chief Executive which provided information on the background to the 2018 review of parliamentary constituency boundaries and of the Commission’s draft recommendations for new parliamentary constituency boundaries in the North West and specifically for Warrington. The report also advised of the next steps arising from the Commission’s draft recommendations.
It was proposed by Cllr C Fitzsimmons and seconded by Cllr C Froggatt and it was resolved that Council would note receipt of Commission’s draft recommendations.
Reason for Decision: To enable the next stage of the review to progress.
C55 Appointment of Director of Public Health
Council considered a report of Councillor Terry O’Neill - Leader and Chair of the Chief Officer Employment Committee which considered the appointment of Dr Muna Abdel Aziz as the Council’s Director of Public Health.
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It was proposed by Cllr T O’Neill and seconded by Cllr G Friend and it was resolved that Dr Muna Abdel Aziz be appointed as the Council’s Director for Public Health, with effect from 11 October 2016.
Signed………………………….
Dated………………………….
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Agenda Item 7.1 WARRINGTON BOROUGH COUNCIL COUNCIL 5 December 2016
Report of the: Chief Finance Officer Report Author: Danny Mather, Corporate Finance Manager Contact Details: Email Address: Telephone: [email protected] 01925 442344 Ward Members: All
TITLE OF REPORT: 2016/17 MID YEAR TREASURY REVIEW
1. PURPOSE OF THE REPORT
1.1 To comply with the Chartered Institute of Public Finance and Accountancy’s (CIPFA) Code of Practice (Code) on Treasury Management (revised 2009) which was adopted by this Council on 1st March 2010, there is a requirement that a half yearly report on the performance of the Council’s treasury management operation be reported to Full Council. This report was reported to the Audit and Corporate Governance Committee on 17 November 2016 as they are the body charged with the scrutiny of Treasury Management by the Council. It is now presented to Council for approval.
1.2 This report provides an update on the first six months of the year which is the requirement of the CIPFA Code. A glossary of treasury terms can also be found in Appendix 1.
2. BACKGROUND
2.1 This mid-year report has been prepared in compliance with CIPFA’s Code of Practice, and covers the following:
An economic update for the first six months of 2016/17 A review of the Treasury Management Strategy Statement and Annual Investment Strategy The Council’s capital expenditure (prudential indicators) A review of the Council’s investment portfolio for 2016/17 A review of the Council’s borrowing strategy for 2016/17 A review of any debt rescheduling undertaken during 2016/17 A review of compliance with Treasury and Prudential Limits for 2016/17
3. ECONOMIC UPDATE
3.1 During the quarter ended 30 September 2016: The economy remained surprisingly robust since Brexit; Households and firms shrugged off referendum uncertainty; The labour market began to soften; Consumer Price Index (CPI) inflation started to pick up; The Bank of England cut interest rates and expanded their asset purchases; The European Central Bank (ECB) and the US Federal Reserve (Fed) kept policy unchanged.
United Kingdom Economy
3.2 UK Gross Domestic Product (GDP) growth rates in 2013 of 2.2% and 2.9% in 2014 were the strong but 2015 was disappointing at 1.8%, though it still remained one of the leading rates among the G7 countries. Growth improved in quarter 4 of 2015 from +0.4% to 0.7% but fell back to +0.4% (2.0% y/y) in quarter 1 of 2016 before bouncing back again to +0.7% (2.1% y/y) in quarter 2. During most of 2015, the economy had faced headwinds for exporters from the appreciation during the year of sterling against the Euro, the weak growth in the European Union (EU), China and emerging markets, plus the dampening effect of the Government’s continuing austerity programme. The referendum vote for Brexit in June this year delivered an immediate shock fall in confidence indicators and business surveys, pointing to an impending sharp slowdown in the economy. However, subsequent surveys have shown a sharp recovery in confidence and business surveys, though it is generally expected that although the economy will now avoid flat lining, growth will be weak through the second half of 2016 and in 2017.
3.3 The Bank of England meeting on August 4th addressed this expected slowdown in growth by a package of measures including a cut in Bank Rate from 0.50% to 0.25%. The Inflation Report included an unchanged forecast for growth for 2016 of 2.0% but cut the forecast for 2017 from 2.3% to just 0.8%. The Governor of the Bank of England, Mark Carney, had warned that a vote for Brexit would be likely to cause a slowing in growth, particularly from a reduction in business investment, due to the uncertainty of whether the UK would have continuing full access, (i.e. without tariffs), to the EU single market. He also warned that the Bank could not do all the heavy lifting and suggested that the Government will need to help growth by increasing investment expenditure and possibly by using fiscal policy tools (taxation). The new Chancellor Phillip Hammond announced after the referendum result, that the target of achieving a budget surplus in 2020 will be eased in the Autumn Statement on November 23.
3.4 The Inflation Report also included a sharp rise in the forecast for inflation to around 2.4% in 2018 and 2019. CPI has started rising during 2016 as the fall in the price of oil and food twelve months ago fall out of the calculation during the year and, in addition, the post referendum 10% fall in the value of sterling on a trade weighted basis is likely to result in a 3% increase in CPI over a time period of 3-4 years. However, the Monetary Policy Committee (MPC) is expected to look through a one off upward blip from this devaluation of sterling in order to support economic growth, especially if pay increases continue to remain subdued and therefore pose little danger of increasing core inflationary price pressures within the UK economy.
United States of America Economy
3.5 The American economy had a patchy 2015 with sharp swings in the growth rate leaving the overall growth for the year at 2.4%. Quarter 1 of 2016 disappointed at +0.8% on an annualised basis while quarter 2 improved, but only to a lacklustre +1.4%. However, forward indicators are pointing towards a pickup in growth in the rest of 2016. The Federal Reserve (Fed) embarked on its long anticipated first increase in rates at its December 2015 meeting. At that point, confidence was high that there would then be four more increases to come in 2016. Since then, more downbeat news on the international scene and then the Brexit vote, have caused a delay in the timing of the second increase which is now strongly expected in December this year.
Eurozone Economy
3.6 In the Eurozone (EZ), the ECB commenced in March 2015 its massive €1.1 trillion programme of quantitative easing to buy high credit quality government and other debt of selected EZ countries at a rate of €60bn per month; this was intended to run initially to September 2016 but was extended to March 2017 at its December 2015 meeting. At its December and March meetings it progressively cut its deposit facility rate to reach -0.4% and its main refinancing rate from 0.05% to zero. At its March meeting, it also increased its monthly asset purchases to €80bn. These measures have struggled to make a significant impact in boosting economic growth and in helping inflation to rise from around zero towards the target of 2%. GDP growth rose by 0.6% in quarter 1 2016 (1.7% y/y) but slowed to +0.3% (+1.6% y/y) in quarter 2. This has added to comments from many forecasters that central banks around the world are running out of ammunition to stimulate economic growth and to boost inflation. The stress that national governments will need to do more by way of structural reforms, fiscal measures and direct investment expenditure to support demand in their economies and economic growth.
Chinese and Japanese Economy
3.7 Japan is still bogged down in very weak growth and making little progress on fundamental reform of the economy while Chinese economic growth has been weakening and the medium term risks have been increasing.
Interest rate forecasts
3.8 The Council’s treasury advisor, Capita Asset Services, has provided the following forecast: Bank rate Public Works Loan Board Borrowing Rates 5 Year 10 Year 25 Year 50 Year Forecast TMSS Current TMSS Current TMSS Current TMSS Current TMSS Current
Dec-16 0.75% 0.10% 2.30% 1.00% 1.50% 3.60% 2.30% 3.40% 2.10% Mar-17 0.75% 0.10% 2.40% 1.00% 1.50% 3.70% 2.30% 3.50% 2.10% Jun-17 1.00% 0.10% 2.50% 1.10% 1.60% 3.70% 2.40% 3.60% 2.20% Sep-17 1.00% 0.10% 2.60% 1.10% 1.60% 3.80% 2.40% 3.70% 2.20% Dec-17 1.25% 0.10% 2.70% 1.10% 1.60% 3.90% 2.40% 3.80% 2.20% Mar-18 1.25% 0.10% 2.80% 1.10% 1.60% 4.00% 2.40% 3.90% 2.20% Jun-18 1.50% 0.25% 2.90% 1.20% 1.70% 4.00% 2.50% 4.30% 2.30% Sep-18 1.50% 0.25% 3.00% 1.20% 1.70% 4.10% 2.50% 4.30% 2.30%
Dec-18 1.75% 0.25% 3.10% 1.20% 1.70% 4.10% 2.50% 4.30% 2.30% Not Recorded Not TMSS in Mar-19 1.75% 0.25% 3.20% 1.20% 1.70% 4.10% 2.50% 4.40% 2.30% TMSS – Treasury Management Strategy Statement 2016/17
3.9 Capita Asset Services undertook a quarterly review of its interest rate forecasts after the MPC meeting of 4th August cut Bank Rate to 0.25% and gave forward guidance that it expected to cut Bank Rate again to near zero before the year end. The above forecast therefore includes a further cut to 0.10% in November this year and a first increase in May 2018, to 0.25%, but no further increase to 0.50% until a year later. Mark Carney has repeatedly stated that increases in Bank Rate will be slow and gradual after they do start. The MPC is concerned about the impact of increases on many heavily indebted consumers, especially when the growth in average disposable income is still weak and could well turn negative when inflation rises during the next two years to exceed average pay increases.
3.10 Economic forecasting remains difficult with so many external influences weighing on the UK. Our Bank Rate forecasts, (and also MPC decisions) will be liable to further amendment depending on how economic data and developments in financial markets transpire over the next year. Forecasts for average earnings beyond the three year time horizon will be heavily dependent on economic and political developments. Major volatility in bond yields is likely to endure as investor fears and confidence ebb and flow between favouring more risky assets i.e. equities, or the safe haven of bonds.
3.11 The overall longer run trend is for gilt yields and PWLB rates to rise, albeit gently. An eventual world economic recovery may also see investors switching from the safe haven of bonds to equities.
3.12 Capita have pointed out consistently that the Federal Reserve rate is likely to go up more quickly and more strongly than Bank Rate in the UK and recent events have not changed that view, just that the timing of such increases may well have been deferred somewhat. While there is normally a high degree of correlation between the two yields, Capita would expect to see a growing decoupling of yields between the two i.e. Capita would expect US yields to go up faster than UK yields. Capita will monitor this area closely and the resulting effect on PWLB rates.
3.13 The overall balance of risks to economic recovery in the UK remains to the downside.
3.14 At the moment the PWLB rates and bond yield are unpredictable at the moment. There are exceptional levels of volatility which are highly correlated to merging market, geo-political and sovereign debt crisis developments. Revised forecasts are based on the Certainty Rate (minus 20 basis points (bps)) which has been accessible to most authorities since 1st November 2012.
3.15 Apart from the uncertainties already explained above, downside risks to current forecasts for UK gilt yields and PWLB rates currently include:
Monetary policy action reaching its limit of effectiveness and failing to stimulate significant sustainable growth, combat the threat of deflation and reduce high levels of debt in some major developed economies, combined with a lack of adequate action from national governments to promote growth through structural reforms, fiscal policy and investment expenditure. Weak capitalisation of some European banks A resurgence of the Eurozone sovereign debt crisis Geopolitical risk in Europe, the Middle East and Asia, increasing safe haven flows Emerging country economies, currencies and corporates destabilised by falling commodity prices and or Federal Reserve rate increases, causing a further flight to safe havens (bonds). UK economic growth and increases in inflation are weaker than currently anticipate Weak growth or recession in the UK’s main trading partners – the EU and US
3.16 The potential for upside risks to current forecasts for UK gilt yields and PWLB rates, especially for longer term PWLB rates include: The pace and timing of increases in the Federal Reserve funds rate causing a fundamental reassessment by investors of the relative risk of holding bonds as opposed to equities and leading to a major flight from bonds to equities. UK inflation returning to significantly higher levels than in the wider EU and US causing an increase in the inflation premium inherent to gilt yields. 4. TREASURY MANAGEMENT STRATEGY STATEMENT AND ANNUAL INVESTMENT STRATEGY UPDATE
4.1 The Council’s Treasury Management Strategy Statement (TMSS) for 2016/17 was approved by the Full Council on 29th February 2016. The Council’s Annual Investment Strategy, which is incorporated in the TMSS, outlines the Council’s investment priorities as follows:
Security of capital Liquidity 4.2 The Council will also aim to achieve the optimum return (yield) on investments commensurate with the proper levels of security and liquidity. In the current economic climate it is considered appropriate to keep investments short term up to a year; however exceptions have been made with the Local Authority Mortgage Scheme (LAMS), Charities, Churches and Local Authorities (CCLA) Property Fund and Green Energy investments.
4.3 In terms of borrowing the Council’s Medium Term Financial Plan (MTFP) had a forecast figure for 2016/17 for borrowing of £510.957m to fund the capital programme. The policy to borrow this money was when the best interest rate position existed during the year and was also dependent on the phasing of the capital programme and progress made on many challenging invest to save schemes.
4.4 Investments and borrowing during the first six months of the year have been in line with the strategy, and there have been no deviations from the strategy. Further details of the Council’s investment and debt portfolio can be seen in section 5 and 6 below.
4.5 As outlined in Section 3 above, there is still considerable uncertainty and volatility in the financial and banking market, both globally and in the UK. In this context, it is considered that the strategy approved on 29th February 2016 is still fit for purpose in the current economic climate.
4.6 During the quarter ended 30 September 2016, the 50 year PWLB target (certainty rate) for new long term borrowing started at 3.00% and ended at 2.10%.
4.7 It is anticipated that further borrowing will be undertaken during the financial year, in part to repay temporary borrowing taken at the end of the previous financial year and in part to meet the capital programme expenditure.
5. THE COUNCIL’S CAPITAL POSITION (PRUDENTIAL INDICATORS)
5.1 This part of the report is structured to update: The Council’s capital expenditure plans; How these plans are being financed; The impact of the changes in the capital expenditure plans on the prudential indicators and the underlying need to borrow; and Compliance with the limits in place for borrowing activity.
5.2 Prudential Indicator for Capital Expenditure – this table shows the revised estimates for capital expenditure and the changes since the capital programme was agreed at the Budget.
Capital Expenditure by Service 2016/17 2016/17 2016/17 Original Q1 Q2 Estimate Position Position £m £m £m Families & Wellbeing 11.750 14.570 14.637 Resources & Strategic Commissioning 3.984 8.224 8.229 Economic Regeneration Growth 59.145 53.681 37.142 & Environment Invest to Save Programme 467.966 116.890 115.66 Total Capital Expenditure 542.845 193.365 175.668
5.3 Changes to the Financing of the Capital Programme – The table below draws together the main strategy elements of the capital expenditure plans. It highlights the original supported and unsupported elements of the capital programme, and the expected financing arrangements of this capital expenditure. The borrowing element of the table increased the underlying indebtedness of the Council by way of the Capital Financing Requirement (CFR), although this will be reduced in part by revenue charges for the repayment of debt (the Minimum Revenue Provision). This direct borrowing need may also be supplemented by maturing debt and other treasury requirements.
Capital Expenditure by Service 2016/17 2016/17 2016/17 Original Q1 Q2 Estimate Position Position £m £m £m Total Capital Expenditure 542.845 193.365 175.668 Financed by: Capital Grants and Reserves 14.685 22.761 24.305 Capital Receipts 1.341 1.854 1.651 Revenue Funding 0 0.303 0.740 External Funding 15.862 15.663 2.415 Total Financing 31.888 40.581 29.111 Borrowing Requirement 510.957 152.784 146.557 5.4 Changes to the Prudential Indicators for the Capital Financing Requirement (CFR), External Debt and the Operational Boundary – the table below shows the CFR, which is the underlying external need to incur borrowing for a capital purpose. It also shows the expected debt position over the period, which is termed the Operational Boundary
2016/17 2016/17 Original Forecast Estimate Position £m £m Prudential Indicator – Capital Financing Requirement Net movement in CFR 504.635 136.820
Prudential Indicator – the Operational Boundary for external debt Borrowing 733.356 408.173 Other long term Liabilities* 4.129 4.232 Total debt (year-end position) 737.485 412.405 * On balance sheet PFI schemes and finance leases, etc.
5.5 Limits to Borrowing Activity – the first key control over the treasury activity is a prudential indicator to ensure that over the medium term net borrowing (borrowings less investments) will only be for capital purposes. Gross external borrowing should not, except in the short term, exceed the total of CFR in the preceding year plus the estimates of any additional CFR for 2016/17 and next two financial years. This allows some flexibility for limited early borrowing for future years. The Council has approved a policy for borrowing in advance of need which will be adhered to if this proves prudent.
2016/17 2016/17 Original Forecast Estimate Position £m £m Borrowing 733.356 408.173 Other long term Liabilities* 4.129 4.232 Total debt (year-end position) 737.485 412.405 CFR (year-end position) 840.078 441.650
There are no difficulties envisaged for the current or future years in complying with this prudential indicator.
5.6 Authorised Limit – a further prudential indicator controls the overall level of borrowing. This is the Authorised Limit which represents the limit beyond which borrowing is prohibited, and needs to be set and revised by Members. It reflects the level of borrowing which, while not desired, could be afforded in the short term, but is not sustainable in the longer term. It is the expected maximum borrowing need with some headroom for unexpected movements. This is the statutory limit determined under section 3(1) of the Local Government Act 2003.
2016/17 2016/17 Original Forecast Estimate Position £m £m Borrowing 924.086 408.173 Other long term Liabilities* 4.129 4.232 Total debt (year-end position) 928.215 412.405 CFR (year-end position) 840.078 441.650
6. INVESTMENT PORTFOLIO 2016/17
6.1 In accordance with the CIPFA Code, it is the Council’s priority to ensure security of capital and liquidity, and to obtain an appropriate level of return which is consistent with the Council’s risk appetite. As set out in Section 3, it is a very difficult investment market with the level of interest rates commonly seen in previous decades as rates are very low and in line with the 0.25% bank rate. The continuing potential for a re-emergence of a Eurozone sovereign debt crisis, and its impact on banks, prompts a low risk and short term strategy. Given this risk environment, investment returns are likely to remain low.
6.2 The Council held £86m of investments as at 30 September 2016 and the investment portfolio yield for the first six months of the year is 4.72%.
6.3 The table below shows the breakdown of the Council’s investment returns compared to Capita’s benchmark, by length of investment.
Benchmark Benchmark Council Return Performance 7 day 0.20% 0.51% 3 month 0.31% - 6 month 0.43% - 12 month 0.65% 1.75%
The table below shows the breakdown of the investments compared to CIPFA’s benchmark, by type of investment.
Benchmark Council Investment Type Return Q2 Performance Fixed Investment (up to 30 days) 0.20% n/a Fixed Investment (31-90 days) 0.20% n/a Fixed Investment (91-364 days) 0.80% 1.60% Fixed Investment (1-5 years) 1.80% 6.30% Fixed Investments (over 5 years) n/a 2.70% Callable & Structured Products 2.60% 2.76% (LAMS) Notice Accounts 0.50% 0.50% Money Market Funds 0.50% 0.50%
6.4 The Council outperforms the benchmarks on all but the notice accounts due to using a low paying interest account for compliance to the Council’s counterparty policy.
6.5 The total of the Council’s investments as at 30th September 2016 was £86m, a breakdown of which is given below:
Fixed Investments Start Maturity Interest Counter Party Date Date Rate Principal CCLA 30/04/13 30/04/23 5.685 13,107,492 Willersey Solar Bond : Rockfire Capital Global11/09/14 11/09/19 7.000 2,000,000 Atherstone Solar Farm Bond (Rockfire) 29/04/15 29/04/20 7.000 4,000,000 Paddock Solar Farm Bond (Rockfire) 29/04/15 29/04/20 7.000 3,000,000 Southam Solar Farm Bond (Rockfire) 29/04/15 29/04/20 7.000 3,000,000 Aldermore Challenger Bank 27/08/15 26/08/16 1.750 0 Solar Bonds 1 (Rockfire) 23/10/15 22/10/20 7.000 5,000,000 LiveWire 29/02/16 28/02/26 4.000 301,499 Solar Bonds 2 (Rockfire) 25/05/16 25/05/21 5.000 10,000,000 Solar Bonds 2 (Rockfire) 25/05/16 25/05/21 5.000 10,000,000 Solar Bonds 2 (Rockfire) 30/06/16 30/06/17 5.000 4,500,000
Total Investments 54,908,991
Overnight Deposits Balance Balance Movement Yearly Avg Counter Party 31/03/2015 30/09/2016 Interest Rate £ £ £ % Santander (A&L) 8,345,000 10,000,000 1,655,000 0.80% Bank of Scotland 1,035,000 2,516 (1,032,484) 0.35% Yorkshire Bank 0 0 0 - Nat West (Select Liquidity) 4,802,000 1,825,000 (2,977,000) 0.25% Handelsbanken 0 29 29 0.35% Legal and General MMF 0 0 0 - Prime Rate MMF 0 9,145,000 9,145,000 0.40% Standard Life (Ignis) MMF 0 10,000,000 10,000,000 0.45% Deutsche MMF 0 0 0 - CCLA MMF 25,000 25,000 0 0.37% 14,207,000 30,997,545 16,790,545 0.52%
6.6 The Council has reclassified the Local Authority Mortgage Scheme as a long term debtor in the Council’s final accounts when previously they had been reported as investments. The details are shown below:
Balance Balance Movement Local Authority Mortgage 31 March 30 Sept during Scheme 2016 2013 year £ £ £ Lloyds/TSB * 2,000,000 1,484,560 515,440 Leeds Bank 500,000 500,000 0 Lloyds/TSB 1,000,000 1,000,000 Lloyds/TSB 2,000,000 2,000,000 0.0 Total Local Authority Mortgage 5,500,000 4,984,560 515,440 Scheme *Please note: the full £2m has not been returned as it is dependent on the timing of the mortgages taken and when the 5 year guarantee expires.
6.7 The Council also classifies the loans to registered social landlords as long term debtors in the Council’s accounts. The details are shown below as at 30th September 2016:
Long Term Debtors: Start Maturity Original Balance Outstanding Movement Counter Party Date Date Drawdown 31/03/015 Principal in Year Warrington Housing Association 13/08/10 11/08/35 1,000,000 875,302 862,113 (13,189) Golden Gates Housing Trust 27/02/12 27/02/37 1,819,234 1,657,061 1,634,421 (22,639) Warrington Housing Association 07/06/12 07/06/37 3,000,000 2,734,377 2,695,464 (38,913) Warrington Borough Transport 26/03/13 21/03/18 250,000 100,000 75,000 (25,000) Warrington Borough Transport 03/04/13 03/04/18 400,000 160,000 120,000 (40,000) Muir Housing Association 22/04/14 22/04/39 2,000,000 1,919,651 1,898,183 (21,468) Helena Housing Group 04/08/14 04/08/39 15,000,000 14,525,475 14,359,357 (166,118) Wulvern Housing Group 04/08/14 04/08/39 10,000,000 10,000,000 10,000,000 0 Your Housing £3m 28/11/14 28/11/39 3,000,000 2,916,519 2,881,770 (34,749) Muir Housing Association D2 £1m 02/07/15 02/07/40 1,000,000 983,344 971,929 (11,416) Muir Housing Assoc D3 £4m 29/04/16 29/04/41 4,000,000 0 3,953,569 3,953,569 Muir Housing Assoc D4 £2m 13/06/16 13/06/41 2,000,000 0 1,987,758 1,987,758 Equity Housing Group D1 £10m 29/06/16 29/06/41 10,000,000 0 9,938,876 9,938,876 Muir Housing Assoc D5 £3.5m 15/07/16 15/07/41 3,500,000 0 3,477,275 3,477,275
OMEGA 09/12/14 24/10/21 7,500,000 4,074,743 4,229,405 154,662 OMEGA 27/11/15 24/10/22 3,212,301 1,652,927 3,212,301 1,559,374
67,681,535 41,599,399 62,297,422 20,698,023
6.8 Investment Counterparty Criteria – The current investment counterparty criteria selection approved in the TMSS is meeting the requirement of the treasury management function. The main rating agencies (Fitch, Moody’s and Standard & Poor’s) have, through much of the financial crisis, provided some institutions with a ratings “uplift” due to implied levels of sovereign support. Commencing in 2015, in response to the evolving regulatory regime, all three agencies have begun removing these “uplifts” with the timing of the process determined by regulatory progress at the national level. The process has been part of a wider reassessment of methodologies by each of the rating agencies. In addition to the removal of implied support, new methodologies are now taking into account additional factors, such as regulatory capital levels. In some cases, these factors have “netted” each other off, to leave underlying ratings either unchanged or little changed.
6.9 In keeping with the agencies’ new methodologies, the credit element of our credit assessment process now focuses solely on the Short and Long Term ratings of an institution. While this is the same process that has always been used by Standard & Poor’s, there has been a change to the use of Fitch and Moody’s ratings. Other key elements to the process, namely the assessment of Rating Watch and Outlook information as well as the Credit Default Swap (CDS) overlay have not been changed.
6.10 The evolving regulatory environment, in tandem with the rating agencies’ new methodologies also means that sovereign ratings are now of lesser importance in the assessment process. Where through the crisis, clients typically assigned the highest sovereign rating to their criteria the new regulatory environment is attempting to break the link between sovereign support and domestic financial institutions. While this authority understands the changes that have taken place, it will continue to specify a minimum sovereign rating of high. This is in relation to the fact that the underlying domestic and where appropriate, international, economic and wider political and social background will still have an influence on the ratings of a financial institution.
6.11 It is important to stress that these rating agency changes do not reflect any changes in the underlying status or credit quality of the institution, merely a reassessment of their methodologies in light of enacted and future expected changes to the regulatory environment in which financial institutions operate. While some banks have received lower credit ratings as a result of these changes, this does not mean that they are suddenly less credit worthy than they were formerly. Rather, in the majority of cases, this mainly reflects the fact that implied sovereign government support has effectively been withdrawn from banks. They are now expected to have sufficiently strong balance sheets to be able to withstand foreseeable adverse financial circumstances without government support. In fact, in many cases, the balance sheets of banks are now much more robust than they were before the 2008 financial crisis when they had higher ratings than now. However, this is not universally applicable, leaving some entities with modestly lower ratings than they had through much of the “support” phase of the financial crisis.
7. BORROWING
7.1 The Council’s 2016/17 MTFP contained a forecasted borrowing figure to fund the capital programme of £510.957m. Following a review of the capital programme this figure as at quarter 2 is £146.557m. It is expected in line with this strategy that borrowing to fund the capital programme will take place in the final quarter of the year.
The current portfolio as at the 30th September 2016 of PWLB loans, market and temporary loans was £341.116m, a breakdown of which is shown below:
Public Works Loan Board Start Maturity Interest Principal Counter Party Date Date Rate % £ PWLB - Maturity 25/09/97 23/03/23 6.625 277,737 PWLB - Maturity 22/02/07 30/09/56 4.350 222,189 PWLB - Maturity 15/01/10 15/01/35 4.530 438,824 PWLB - Annuity 13/08/10 13/08/35 3.940 46,680 PWLB - Maturity 26/11/10 30/09/55 5.260 555,473 PWLB - Maturity 20/06/11 20/06/16 3.020 0 PWLB - Annuity 27/02/12 27/02/37 3.760 1,603,336 PWLB - Annuity 11/06/12 11/06/37 3.260 2,667,095 PWLB - Annuity 24/04/14 24/04/39 3.940 1,901,761 PWLB - Annuity 04/08/14 04/08/39 3.800 14,249,470 PWLB - Maturity 15/09/14 15/09/39 3.940 10,000,000 PWLB - Annuity 28/11/14 28/11/39 3.140 2,878,269 PWLB - Annuity 02/07/15 02/07/40 3.210 973,411 PWLB - Annuity 29/04/16 29/04/41 2.860 4,000,000 PWLB - Annuity 13/06/16 13/06/41 2.450 2,000,000 PWLB - Maturity 29/06/16 28/04/66 2.500 20,000,000 PWLB - Annuity 29/06/16 27/06/41 2.260 10,000,000 PWLB - Annuity 19/07/16 19/07/41 2.030 3,500,000
Total Outstanding 75,314,245
Money Market Start Maturity Interest Principal Counter Party Date Date Rate % £ DEPFA BANK PLC* 21/04/97 21/10/66 5.800 5,000,000 BAYERISHCE LANDESBANK* 27/03/02 27/03/42 4.980 5,000,000 EURAPAISCHE HYPOTHEKEN* 02/04/02 02/04/42 5.000 5,000,000 EURO HYPO* 26/04/02 28/04/42 4.990 15,000,000 DEPFA BANK PLC* 01/04/03 01/04/43 4.223 5,000,000 DEPFA ACS BANK* 01/04/03 01/04/43 4.304 10,000,000 DEXIA FINANCE PUBLIC BANK* 24/11/05 24/11/65 3.820 10,000,000 BARCLAYS BANK 03/04/06 05/04/66 3.810 5,000,000 BARCLAYS BANK 20/01/06 20/01/66 3.960 10,000,000 BARCLAYS BANK 26/07/07 26/07/77 4.180 25,000,000 DEXIA FINANCE PUBLIC BANK* 16/08/06 17/08/76 4.230 13,500,000 London Borough of Newham 31/10/13 31/10/17 1.850 5,000,000 London Borough of Bromley 31/10/13 31/10/16 1.450 5,000,000 Hampshire CC 19/11/13 18/11/16 1.300 4,000,000 Hampshire Police & Crime 19/11/13 18/11/16 1.300 1,000,000 Hampshire CC 13/12/13 12/12/18 2.350 5,000,000 Milton Keynes 24/11/14 25/11/19 2.000 5,000,000 Hertfordshire CC 26/11/14 25/11/16 1.070 5,000,000 Oxfordshire CC 22/07/15 21/07/17 0.850 5,000,000 Oxfordshire CC 22/07/15 20/07/18 1.200 5,000,000 Bond : Variable Rate Linked to CPI 25/08/15 25/08/55 0.846 50,000,000 Charnwood BC 24/02/16 24/02/18 0.900 2,000,000 London Borough of Wandsworth 26/02/16 26/02/18 0.980 5,000,000 Sheffield City Region 18/03/16 16/03/18 0.950 3,000,000
Bonds 01/04/08 01/04/50 0.500 12,275 Total Outstanding 208,512,275 Temporary Loans Start Maturity Interest Principal Counter Party Date Date Rate % £ Parish Council Loans Various 31/03/16 0.500 289,947 Hynburn 10/04/15 08/04/16 0.500 0 Hynburn 17/04/15 15/04/16 0.500 0 West Yorkshire Police & Crime Commission07/03/16 01/03/17 0.650 5,000,000 Sheffield City Region 21/03/16 20/03/17 0.680 5,000,000 Christchurch Borough Council 21/03/16 20/03/17 0.590 2,000,000 Hartlepool Borough Council 22/03/16 21/03/17 0.600 3,000,000 Hyndburn Borough Council 08/04/16 07/04/17 0.600 1,000,000 Hyndburn Borough Council 15/04/16 13/04/17 0.600 1,000,000 London Borough of Brent 24/05/16 06/03/17 0.570 10,000,000 PCC West Yorkshire 24/05/16 24/05/17 0.580 5,000,000 Leicester City Council 24/05/16 30/03/17 0.600 5,000,000 London Borough of Ealing 15/06/16 15/03/17 0.550 5,000,000 Leicester City Council 16/06/16 30/03/17 0.600 5,000,000 London Borough of Brent 20/06/16 20/03/17 0.580 5,000,000 Middlesbrough Council 23/06/16 22/03/17 0.550 5,000,000
Total Outstanding 57,289,947 8. Lenders Option Borrowers Option
8.1 Lender Option Borrower Options (LOBO’s) are long term borrowing, usually 50-60 years on a fixed rate. At certain intervals the lender has the option to formally apply to change the rate (the lenders option), this is inevitably only going to happen if rates are increasing and they wish to increase the fixed rate. The borrower then has the option of either agreeing the increase or repaying the debt whole. The risk to borrowers is that the lender proposes an increase in rates, in particular a significant increase, and they have no option but to agree to the increase and could be left paying a very high interest rate.
8.2 The Council’s exposure to this risk has been mitigated by a number of actions:-
The Council has spread the risk by having eleven LOBO’s with six different lenders over a number of years.
The Council’s portfolio of LOBO’s is structured so that the call dates (the date a lender can exercise their option to review rates) are staggered with the next call date on each LOBO falling at different times and at different frequencies. Therefore the Council is not exposed to all Lenders wanting to exercise their option at a similar time or to short term fluctuations in the financial markets.
The Council has investments of a significant element of which is very short term and could be called upon to provide significant funding very quickly if it did need to repay a LOBO.
The Council also has access to the PWLB to take out new borrowing to refinance the repayment of any LOBO’s if unacceptable rate increases were being requested.
The Council has worked hard to obtain its Aa2 credit rating that will also allow it to have access to the best rates available in the wider market if it did need to refinance any LOBO.
8.3 Therefore given all these factors it is unlikely the Council would need to renew a LOBO if the terms were unfavourable.
8.4 One bank which the Council has some LOBO’s with, Barclays Bank, notified the Council that they will transfer their LOBO’s to a fixed loan with the Council. The Council has three LOBOS’ with Barclays totalling £40m (see detailed information in table 7.1) and have approximately 50 years term remaining. Officers of the Council are evaluating repayment of the loans and have arranged a meeting with Barclay Bank for further discussion. 9. DEBT RESCHEDULING
9.1 Debt rescheduling opportunities have been limited in the current economic climate and consequent structure of interest rates. No debt rescheduling was undertaken during the first six months of 2016/17.
10. COMPLIANCE WITH TREASURY AND PRUDENTIAL LIMIT
10.1 It is a statutory duty for the Council to determine and keep under review the “Affordable Borrowing Limits”. The Council’s approved Treasury and Prudential Indicators (affordability limits) are outlined in the approved Treasury Management Strategy Statement (TMSS).
10.2 During the financial year to date the Council has operated within the treasury limits and prudential indicators set out in the Council’s TMSS and in compliance with the Council's Treasury Management Practices (TMP). The main prudential and treasury indicators are shown in the table below:
Prudential Indicator 2016/17 2016/17 Indicator Qtr2 Forecast £m £m Capital Expenditure 542.8 175.7 In Year Borrowing Requirement Authorised limit for external debt 928.2 412.4 Operational boundary for external debt 747.5 412.4 Gross Borrowing 511.0 412.4 Investments -85.9 Net Borrowing 511.0 326.5 Capital Financing Requirement (CFR) 840.1 441.7 Ratio of financing costs to net revenue stream 11.8 18.3 Incremental impact of capital investment decisions: a) Increase in council tax (band change) per annum 26.4 39.17 Limit of fixed interest rates based on net debt 100% 100% Limit of variable interest rates based on net debt 40% 40% Principal sums (£m) invested > 364 days £75 £50 Maturity structure of borrowing limits: Under 12 months 25% 22.7% 12 months to 2 years 25% 5.9% 2 years to 5 years 35% 2.9% 5 years to 10 years 30% 0.1% 10 years and above 100% 68.5%
11. YEAR END FORECAST POSITION
11.1 The Council is forecasting a £5m underspend position on the Loans and Investments budget at the year end, based on the figures at the end of September 2016. This is a result of a fall in borrowing costs, diversification of the investment portfolio, success of the loans programme and LAMS, slippage on the capital programme and a potential LOBO restructuring opportunity.
12. TREASURY DEVELOPMENTS
12.1 Loans to Registered Providers – during the period the Council continued to expand its Loans to Registered Providers Scheme. In line with the Council’s 2016/17 Capital Programme agreed by Full Council in February 2016, a loan to Equity Housing Group was agreed in February 2016 with an initial drawdown of £10m was taken at the end of June. Further loans are being discussed with other providers and a future report will go to the Executive Board for approval if the deal progresses.
12.2 The loans to the registered providers are provided at different rates and margins. The expected total accumulated profit on the loans will be nearly £2m by the end of the financial year 2016/17 and the Council has received over £2m for all of the arrangement fees on the facilities provided.
12.3 Omega – a further facility was approved by the Executive Board in December 2015 totalling £5.4m to fund infrastructure works in relation to the new Barrow Hall Primary School Development. A further drawdown has been taken from the facility in the period totalling £101k.
12.4 Local Authority Property Fund – The Council’s investment in the Churches, Charities and Local Authority (CCLA) Property Fund is a unit trust fund that invests in commercial and industrial property in the UK. The fund continues to perform well and is currently yielding an investment return of 5.23%. The initial £10m investment has increased in value by £3.107m during the past three years.
12.5 Treasury Management Board - The Treasury Management Board is a body of leading Councillors that receives and debates details of the risks and opportunities of treasury management and related capital programme developments. Discussion regarding the Business Bank and the Funding Circle were held during the last meeting.
12.6 Swindon Solar Farm Investment – in line with the Council’s 2016/17 Treasury Management Strategy the Council successfully concluded the investment deal in Wroughton Solar Farm Swindon. This is a £73m investment between the Council, Newham and Thurrock Councils. It is expected another large Council will invest in November 2016. The Council has a total of £41.5m invested in solar bonds.
12.7 Green Energy Bonds – at the meeting of 30 June 2016 it was recommended that the limit for bonds was increased from £10m per bond to £20m.
12.8 Additional Counterparty – the Funding Circle is a peer to peer lending platform that gives loans to UK businesses. A number of Council (19) currently invest in it and it pays an average rate of interest of 7.5%. The Funding Circle was added to the Council’s counterparty list at the last Audit and Corporate Governance Committee in September 2016. A full update was given to the Treasury Management Board at their last meeting.
12.9 Local Government Association (LGA) Municipal Bond Agency (MBA) – the LGA have set up an agency (Local Capital Finance Company (LCFC)) whereby low or high levels of bond finance could be obtained by Local Authorities as an alternative option to the PWLB. The LGA and 48 councils have signed up to become investors in the company, with the Council investing £200k in the bond agency. The first bond is expected in 2016/17.
12.10 Contract Monitoring – the Council has set up an effective contract monitoring system to monitor its loan contracts on an ongoing basis. This was subject to a full audit review in 2015/16 which gave substantial assurance of the procedures.
12.11 Business Bank – in line with the 2016/17 TMS and the £30m allocation in the capital programme an initial policy directive from the Local Economy Policy Committee. A business case to create a business bank has been worked on in the period and it is forecast to take a proposal to the Executive Board in December 2016.
12.12 Local Authority Investment Fund – work continued on the 2016/17 TMSS objected to create a Local Authority Investment Fund in the period. The TMB have been fully updated on developments.
13. CONFIDENTIAL OR EXEMPT
13.1 Not confidential.
14. FINANCIAL CONSIDERATIONS
14.1 Due to the nature of the report, the financial implications are contained throughout the report.
14.2 In order to achieve a balanced budget, the authority relies upon generating maximum interest from its investments whilst minimising the exposure to risk. In order to achieve this, investments are mainly placed with institutions which are included on the investment counterparty list. Investment durations sometimes exceed those as advised by Capita credit ratings which are associated with the specific institutions. Full analysis has been provided for any exceptions to this in committee reports.
14.3 Where the authority is required to borrow to meet the needs of the authority, officers will evaluate market information on timings and options in order to ensure the best deal for the Council.
15. RISK ASSESSMENT
15.1 A full risk assessment has been undertaken. The Council’s annual Treasury Management Strategy Statement details the financial risks facing the Council’s treasury portfolio over the coming year.
15.2 The Council has also completed the CIPFA Treasury Management risk assessment survey and the results will be reported to the committee.
16. EQUALITY AND DIVERSITY/EQUALITY IMPACT ASSESSMENT
16.1 The Finance Service undertakes equality impact assessment (EIA) in its wider functions. Service changes that emerge from proposals contained in the TMSS are subject to equality impact assessments.
17. CONSULTATION N/A
18. CONCLUSION 18.1 All treasury activity for the first half of the year was carried out in full compliance with the Council’s Treasury Management Strategy Statement which was approved by Full Council on 29th February 2016.
19. REASONS FOR RECOMMENDATIONS 19.1 To ensure the Council compiles with the 2009 revised CIPFA Treasury Management Code of Practice.
20. RECOMMENDATIONS
20.1 That the committee note the report.
21. BACKGROUND PAPERS
Treasury working papers Contacts for Background Papers:
Name E-mail Telephone Danny Mather [email protected] 01925 442344 Corporate Finance Manager
Appendix 1 GLOSSARY OF TERMS
Basis Point (BP) 1/100th of 1%, i.e. 0.01% Base Rate Minimum lending rate of a bank or financial institution in the UK Benchmark A measure against which the investment policy or performance of a fund manager can be compared. Bill of Exchange A financial instrument financing trade. Callable Deposit A deposit placed with a bank or building society at a set rate for a set amount of time. However, the borrower has the right to repay the funds on pre agreed dates, before maturity. This decision is based on how market rates have moved since the deal was agreed. If rates have fallen the likelihood of the deposit being repaid rises, as cheaper money can be found by the borrower. Cash Fund Fund management is the management of an investment portfolio of cash on Management behalf of a private client or an institution, the receipts and distribution of dividends and interest, and all other administrative work in connection with the portfolio. Certificate of Deposit Evidence of a deposit with a specified bank or building society repayable on a fixed date. They are negotiable instruments and have a secondary market; therefore the holder of a CD is able to sell it to a third party before the maturity of the CD. Commercial Paper Short-term obligations with maturities ranging from 2 to 270 days issued by banks, corporations and other borrowers. Such instruments are unsecured and usually discounted, although some may be interest bearing. Corporate Bond Strictly speaking, corporate bonds are those issued by companies. However, the term is used to cover all bonds other than those issued by governments in their own currencies and includes issues by companies, supranational organisations and government agencies. Counterparty Another (or the other) party to an agreement or other market contract (e.g. lender/borrower/writer of a swap/etc.) CDS Credit Default Swap – a swap designed to transfer the credit exposure of fixed income products between parties. The buyer of a credit swap receives credit protection, whereas the seller of the swap guarantees the credit worthiness of the product. By doing this, the risk of default is transferred from the holder of the fixed income security to the seller of the swap. CFR Capital Financing Requirement CIPFA Chartered Institute of Public Finance and Accountancy CLG Department for Communities and Local Government CPI Consumer Price Index – calculated by collecting and comparing prices of a set basket of goods and services as bought by a typical consumer, at regular intervals over time. The CPI covers some items that are not in the RPI, such as unit trust and stockbrokers fees, university accommodation fees and foreign students’ university tuition fees. DCLG Department of Communities and Local Government Derivative A contract whose value is based on the performance of an underlying financial asset, index or other investment, e.g. an option is a derivative because its value changes in relation to the performance of an underlying stock. DMADF Deposit Account offered by the Debt Management Office, guaranteed by the UK government. ECB European Central Bank – sets the central interest rates in the EMU area. The ECB determines the targets itself for its interest rate setting policy; this is to keep inflation within a band of 0 to 2%. It does not accept that monetary policy is to be used to manage fluctuations in unemployment and growth caused by the business cycle. EMU European Monetary Union Equity A share in a company with limited liability. It generally enables the holder to share in the profitability of the company through dividend payments and capital gain. EU European Union Fed. Federal Reserve Bank of America – sets the central rates in the USA Floating Rate Notes Bonds on which the rate of interest is established periodically with reference to short-term interest rates Forward Deal The act of agreeing today to deposit funds with an institution for an agreed time limit, on an agreed future date, at an agreed rate. Forward Deposits Same as forward dealing (above). FSA Financial Services Authority – body responsible for overseeing financial services. Fiscal Policy The Government policy on taxation and welfare payments. GDP Gross Domestic Product GF General Fund Gilt Registered British government securities giving the investor an absolute commitment from the government to honour the debt that those securities represent. Gilt Funds Pooled fund investing in bonds guaranteed by the UK government. Government MMF MMFs that invest solely in government securities, or reverse repurchase agreements backed by Government Securities. HM Treasury Her Majesty’s Treasury HRA Housing Revenue Account IFRS International Financial Reporting Standards LIBID London Interbank Bid Rate – LIBID is calculated through a survey of London banks to determine the interest rate which they are willing to borrow large Eurocurrency deposits. LOBO’s Lenders Option Borrowers Option loans Money Market Fund A well rated, highly diversified pooled investment vehicle whose assets (MMF) mainly comprise of short term instruments. It is very similar to a unit trust, however in a MMF. Monetary Policy Government body that sets the bank rate (commonly referred to as being committee (MPC) base rate). Their primary target is to keep inflation within plus or minus 1% of a central target of 2.5% in two years’ time from the date of the monthly meeting of the Committee. Their secondary target is to support the Government in maintaining high and stable levels of growth and employment. MRP Minimum Revenue Provision MTFP Medium Term Financial Plan Open Ended A well-diversified pooled investment vehicle, with a single purchase price, Investment rather than a bid/offer spread. Companies Other Bond Funds Pooled funds investing in a wide range of bonds. PFI Private Finance Initiative PWLB Public Works Loan Board QE Quantitative Easing Reverse Gilt Repo This is a transaction as seen from the point of view of the party which is buying the gilts. In this case, one party buys gilts from the other and, at the same time and as part of the same transaction, commits to resell equivalent gilts on a specified future date, or at call, at a specified price. Retail Price Index Measurement of the monthly change in the average level of prices at the (RPI) retail level weighted by the average expenditure pattern of the average person. RPIX As RPI but excluding mortgage interest rate movements. RPIY As RPI but excluding mortgage interest rate movements and changes in prices caused by changes in taxation. Sovereign Issues (Ex Bonds issued or guaranteed by nation states, but excluding UK government UK Gilts) bonds. Supranational Bonds Bonds issued by supranational bodies, e.g. European investment bank. These bonds – also known as Multilateral Development Bank bonds – are generally AAA rated and behave similarly to gilts, but pay a higher yield (“spread”) given their relative illiquidity when compared with gilts. SORP Statement of Recommended Practice S151 Section 151 Officer Term Deposit A deposit held in a financial institution for a fixed term at a fixed rate. Treasury Bill Treasury bills are short term debt instruments issued by the UK or other governments. They provide a return to the investor by virtue of being issued at a discount to their final redemption value. UBS Union Bank of Switzerland US United States WARoR Weighted Average Rate of Return is the average annualised rate of return weighted by the principal amount in each rate. WAM Weighted Average Time to Maturity is the average time, in days, till the portfolio matures, weighted by principal amount. WATT Weighted Average Total Time is the average time, in days, that deposits are lent out for, weighted by principal amount. WA Risk Weighted Average Credit Risk Number. Each institution is assigned a colour corresponding to a suggested duration using Sector’s Suggested Credit Methodology. Model WARoR Model Weighted Average Rate of Return is the WARoR that the model produces by taking into account the risks inherent in the portfolio.
Agenda Item 11 WARRINGTON BOROUGH COUNCIL
COUNCIL 5 DECEMBER 2016
Report of the: Chief Executive
Report Author:Dann Sharon Parker, Councillor Services Manager
Contact Details: Email Address: Telephone: [email protected] 01925 442161
Ward Members: All
TITLE OF REPORT: PETITIONS
1. PURPOSE OF THE REPORT 1.1 To provide Council with details of three petitions received in relation to: car parking in Lymm and Stockton Heath; the library service in Lymm; and Warrington’s Libraries 1.2 to comply with the councils adopted procedure to debate the petitions.
2. BACKGROUND
2.1 The following electronic petitions have been received:
Petition Overviews:
Petition 1 - Car parking in Lymm and Stockton Heath Treat the District carparks of Warrington equally – applying the same policies consistently to all. The practice of only charging in the District Carparks of Lymm and Stockton Heath is inequitable. The Parking Strategy 2013 document sets ‘Support the local economy’ as an objective, and removal of the free parking period in the Lymm & Stockton Heath carparks penalises local residents and business, and puts a barrier against ‘Living and Working.
Petition 2 – Library service in Lymm We petition Warrington Borough Council to maintain and keep open our modern and efficient Lymm Community Library. Although there have already been cutbacks, in its current form it meets the requirements of our community, and to continue to do this must be maintained at least at the same level.
Petition 3 – Warrington’s Libraries Bin your proposals to close move and water down Warrington’s libraries. Instead commit to retain all existing libraries, consult with the public and community groups on ways to involve even more community groups in to existing libraries and do more to publicly promote and celebrate the many activities already on offer and across the network.
2.2 Currently the closing date for petitions one and two is 4 December however the trigger of 1500 names has now been reached. The third petition has no closing date but the trigger for debate at Council has been reached for this petition also.
3. PETITION PROCESS
3.1 The Council at its Annual Meeting in 2010 agreed the model scheme for dealing with petitions put forward by the Department of Communities and Local Government. The Local Democracy, Economic Development and Construction Act 2009 (the 2009 Act) introduced a new ‘petitions duty’. The core elements of the petitions duty came into force on 15 June 2010. Although this duty has since been repealed there has been no decision taken by the Council to amend its Scheme.
3.2 The scheme states that should a petition contain more than 1500 signatures it will be debated by full Council. The petition organiser will be given five minutes to present the petition at the meeting and the petition will then be discussed by Councillors for a maximum of 15 minutes. The Council will decide how to respond. Options available to Council are:
Take the action requested; Not to take the action requested for reasons put forward in the debate; Commission further investigation into the matter e.g. by a relevant committee; Should the issues be one that the Executive Board should take, the Council will decide whether to make a recommendation to inform that decision.
4. FINANCIAL CONSIDERATIONS
Library service No decision has been taken on this matter. Financial considerations will be taken into account when reaching a decision.
Car Parking in Lymm and Stockton Heath The current parking tariffs were first introduced four years ago and as part of these charges the first hour of parking was free. During a time of severe budgetary constraints, the Council needs to make financial savings and therefore, as part of the 16/17 budget setting process, a savings target of £116k was set for Parking Services. At the last meeting of the Parking
Executive Task Group in July 2016, a number of tariff options were considered and the decision was taken to remove the ‘one hour free parking’ and implement the new charges as a way of generating the savings target.
5. EQUALITY AND DIVERSITY/EQUALITY IMPACT ASSESSMENT
All car parks are available to any member of the public, irrespective of age, disability, sexual orientation, gender, race or religion and it is their personal choice whether they use the car park or choose to park elsewhere.
As part of the changes, regular users who use the car parks for very short visits, for example dropping off / picking up children from nearby schools will receive 15 minutes free parking and in addition to this, charges only apply between 9:00 -15:00 Monday to Saturday, allowing shoppers, residents and visitors to use the car parks for free after 15:00. The car parks are also free on Sundays and Bank Holidays.
The car parks will continue to be completely free for Blue badge holders who can park all day for no charge when displaying a valid blue badge.
Library Service No decision has been taken on this matter. A full equality impact assessment will take place at the appropriate time.
Information required re the car parking petition.
6. CONSULTATION
6.1 The Petition Organisers have been advised of the procedure for dealing with petitions. 7. REASONS FOR RECOMMENDATIONS
7.1 To comply with the Council’s process for dealing with petitions.
8. RECOMMENDATIONS
Council considers appropriate action as detailed in section 3.2 of the report, following a debate on the three petitions.
9. BACKGROUND PAPERS
Contacts for Background Papers:
Name E-mail Telephone Sharon Parker [email protected] 01925 442161