Agenda item

The Director of Finance, Assets and Information Services will submit a report prefacing a submitted to Cabinet on the 24^th February, 2016 on the rationale behind the Council changing its MRP Policy which was approved by Council on the 31^st March, 2016.

The Director of Finance, Assets and Information Services submitted a report prefacing a report to be submitted to Cabinet on the 24^th February, 2016 on the rationale behind the Council changing its MRP Policy which was approved by the Council on the 31^st March, 2016.

The report gave details of the rationale behind and justification for the revision of the Policy which would solely adopt the annuity method of only repaying debt over the standard 50 year repayment period unless there was a more appropriate timescale suitable. 

The changes were considered to be consistent with the statutory duty on the Council to make prudent provision, having regard to statutory guidance.  In addition, they took account of the Council’s strict and cautious approach to MRP  to date as well as the Council’s future financial arrangements.  It was also reported that officers had worked up detailed modelling to reflect these changes and these had been incorporated within the Authority’ final accounts position for 2015/16.

In the ensuing discussion reference was made to the following:

·         The key driver for the changes introduced was to ensure consistency and standardisation

·         An update on the progress would be provided within the Medium Term Forecast

·         Reference was made to the current position with regard to PFI/BSF schools and to the potential implications for the authority of more schools pursuing academisation following the publication of the Government White Paper 2016.  It was noted that these issues had been raised with Government particularly in relation to the removal of local authority assets

·         The Service Director Finance referred to the factors taken into account in revising the policy.  These factors were also acceptable to the External Auditor KPMG and with the views of the Chief Estates Officer particularly in relation to local authority assets.  They were also consistent with the approach of other Local Authorities

RESOLVED that the Cabinet report and decision of the Council in relation to the revised MRP policy for 2015/16 be noted.