Issue - meetings

To approve the following recommendations to Full Council for consideration at its meeting on 6 March 2024: approve and implement the Integrated Investment Framework; approve that the target for the overall return on Council investments should aspire to at least meet forecasts for inflation over the medium term; and approve that the benefits of investing in the Pension Fund should be used as a benchmark when evaluating other investments.

Cabinet approved the following recommendations to Full Council for consideration at its meeting on 6 March 2024:

·       approve and implement the Integrated Investment Framework set out in this report; 

·       approve that the target for the overall return on Council investments should aspire to at least meet forecasts for inflation over the medium term; 

·       approve that the benefits of investing in the Pension Fund should be used as a benchmark when evaluating other investments; 

·       adopt the asset allocation percentage ranges set out in the framework and work towards achieving these; 

·       agree that the overarching objective of this framework is to achieve an overall return on Council investments, matching CPI inflation over the medium term, and to reduce costs and liabilities, while maintaining adequate cash balances for operational purposes, and not exposing the capital value of investments to unnecessary risk; 

·       Agree that assets must only be acquired for strategic purposes. Such prospective acquisitions must be considered individually, with the reasons for investment limited to regeneration or development of the location, or other strategic purposes in which the asset is established. Out-of-borough acquisitions may also be considered by exception; 

·       the Investment Executive to implement, monitor and report on the investment strategy.  

Reasons for Decision

The Integrated Investment Framework is an annual report which influences investment decisions going forwards to deliver added value to Council services by identifying the potential for future improved returns.

The Chair invited Councillor Boothroyd to introduce the item.

Councillor Boothroyd noted that this is a framework which is decided upon annually with little change year to year, and that the Council has been managing its investments well.

Gerald Almeroth noted that it has been updated for key issues such as interest rates and inflation risk, but shows overall that the Council has a good performance while prudent in managing risk.

RESOLVED: Cabinet approved the following recommendations to Full Council for consideration at its meeting on 6 March 2024:

·       Approve and implement the Integrated Investment Framework set out in this report; 

·       Approve that the target for the overall return on Council investments should aspire to at least meet forecasts for inflation over the medium term; 

·       Approve that the benefits of investing in the Pension Fund should be used as a benchmark when evaluating other investments; 

·       Approve adoption of the asset allocation percentage ranges set out in the framework and work towards achieving these; 

·       Agree that the overarching objective of this framework is to achieve an overall return on Council investments, matching CPI inflation over the medium term, and to reduce costs and liabilities, while maintaining adequate cash balances for operational purposes, and not exposing the capital value of investments to unnecessary risk; 

·       Agree that assets must only be acquired for strategic purposes. Such prospective acquisitions must be considered individually, with the reasons for investment limited to regeneration or development of the location, or other strategic purposes in which the asset is established. Out-of-borough acquisitions may also be considered by exception; 

·       Note that the Investment Executive to implement, monitor and report on the investment strategy.