This report fulfils the requirement in the Treasury Management Strategy to produce an Annual Outturn Report to review the Treasury Management activity which took place from 1st April 2024 to 31st March 2025.

The Committee considered a report on the Council’s Treasury Management Strategy and Annual Investment Strategy for 2024/25.  The Treasury Management Strategy required an Annual Outturn Report reviewing the Treasury Management activity which had taken place during the year. 

The report stated that at the start of 2024/25 the Bank of England base interest rate had sat at 5.25%. As had been reported through the quarterly review reports, the bank rate had been cut to 4.75% by the end of Quarter 3 and had been subsequently cut further to 4.50% on 6 February 2025. Outside of this reporting period, the bank rate had been cut further to 4.25% on 8 May 2025 and held at this level on 19 June 2025. The next projected cut to bank rate was currently forecast to occur in August 2025.

The Council remained significantly under borrowed against its Capital Financing Requirement and had followed the approved borrowing strategy of deferring any potential long-term borrowing whilst interest rates remained at current levels and instead utilised short or temporary borrowing from the local authority market as required. No long-term loans (those over one year in duration) had been taken out during the year. During 2024/25 the Council took out short-term loans (less than one year in duration) of £253.500m (from other local authorities) at an average interest rate of 5.13%.

Overall, the Council had under borrowed by £149.718m as at 31 March 2025. As a consequence, the Council had effectively avoided the requirement to budget for and incur external interest costs in the order of £6.168m during 2024/25, based on the average rate for the existing debt portfolio of 4.12%.  Against the 2024/25 General Fund budget, there had been an overall positive net variance of £2.653m on the Capital Financing budget as reported in the 2024/25 Quarter 4 Performance report to Policy Committee on 21 July 2025. This budget included interest payable, interest receivable and Minimum Revenue Provision (MRP); a charge to the revenue budget made in respect of paying off the principal sum of the borrowing undertaken to finance the Capital Programme.

The report stated that the Council had not breached any of its treasury management performance indicators during 2024/25.  The Borrowing and Investment portfolios and a list of approved Countries for Investments as at 31 March 2025 were appended to the report.

Resolved:     That the Treasury Management Outturn Report for 2024/25 be noted.