05:13PM, Friday 22 October 2021
York House, Windsor
The Royal Borough’s borrowing costs were thrown into the spotlight at a council meeting this week, with the authority set to hold £212million in loans at the end of this financial year.
A meeting of the audit and governance committee in Windsor last night also heard that the council would be moving to ‘longer term borrowing’ to mitigate against the risk of high interest rates and inflation.
The council’s head of finance Andrew Vallance said that inflation has not been a key issue in budget reports for ‘donkey’s years’ and hinted that there could be a need to make modifications to the upcoming draft budget because of the changing economic climate.
Mr Vallance added that the borough’s gas bills could also go up by as much as 40 per cent in the midst of the current crisis within this sector.
“There is a risk – it is a small element of our budget,” he told the meeting at York House. “There are concerns around gas prices and we will do more work on that.
“Some of our gas contracts could go up by 40 per cent potentially.”
Regarding borrowing concerns, Mr Vallance said that the council takes advice from expert advisors when the authority borrows cash.
Members were discussing a document called the ‘Draft Treasury Management Strategy’, which will go to full council – alongside next year’s budget – in February 2022.
At the end of 2021/22, the borough is forecast to hold £212.3million of loans, an increase of £20.6million from the previous year.
A further increase in borrowing to £212.7million is projected at the end of 2022/23.
But the council’s lead member for finance, Councillor David Hilton (Con, Ascot and Sunningdale), added that ‘a lot of thought’ goes into managing this.
“As the finance team put money into long-term borrowing, they are going to make sure the length of the loans are staggered best they can to match what the forecasts are for interest rates,” he said.
“An awful lot of thought goes into how to manage cash flows.”
Later in the meeting, councillors discussed the authority’s ‘Draft Capital Strategy’, a document which sets out major projects the Royal Borough is due to invest in up to the 2026/27 financial year.
The report was praised by both Cllr Hilton and meeting chairman Cllr Lynne Jones (OWRA, Old Windsor) for its transparency.
The strategy will be reflected by the council’s draft corporate plan, which is due to be debated at cabinet next month.
“We will revise this strategy if cabinet or full council revise the corporate plan,” Mr Vallance said.
Some of the major projects within the document include investing £1million to reduce emissions, and spending £10million on flooding prevention within Datchet, Horton and Wraysbury and Old Windsor in partnership with the Environment Agency.
The UK has voted to leave the European Union in yesterday's referendum - and while the Royal Borough of Windsor and Maidenhead fell into the remain camp, Slough voted to support a Brexit.