Appendix 2 TM Prudential Indicators - 29.09.2026

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Cash investment balances fell by 52% in a year, from £137.2m to £65.5m, while the average investment return over the quarter was 4.01%, which was 0.28 percentage points above the benchmark rate. p4

Total external borrowing stood at £198.142m as at 30 June 2026, at an average rate of 4.35%, and during the quarter a £2.0m Public Works Loan Board loan matured. p10p12

The report forecasts a new borrowing requirement of £211.558m for 2026/27, compared with an original estimate of £209.422m. p13

The Council is operating within its Operational Boundary and the borrowing limit set for external debt, with headroom to cover any unforeseen borrowing need arising from the year's capital programme. p28

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• p4Cash investment balances as at 30 June 2026 have fallen by 52% in one year, from £137.2m at Q1 2025/26 to £65.5m due to continued use of cash balances to support the capital programme and revenue cashflow requirements whilst new borrowing is delayed during a time of elevated rates. The average investment return over Q1 was 4.01% performing above the benchmark rate by 28 basis points (or 0.28 percentage points). Performance has reduced marginally because of maturing investments being placed in a lower interest rate environment and for a shorter duration, due to cashflow.
• p100.005% Borrowing The table below shows the Council’s total external borrowing and weighted average interest rate as at 30 June 2026. During Q1, a £2.0m Public Works Loan Board loan, carrying an interest rate of 7.125%, matured on 30 June 2026. Short-term borrowing was also undertaken during Q1 to manage temporary cash flow shortfalls. This funding was sourced from the local authority lending market through the Council’s approved brokers.
• p12PWLB 198.142 4.35% Total Borrowing 198.142
• p134.35% The table below shows the Q1 forecast for the Capital Financing Requirement (CFR) compared to the estimate within the 2026/27 strategy approved in February 2026. The total CFR is expected to give rise to a new borrowing requirement of £211.558m (£141.558m capital programme and £70.000m capitalisation direction) by the end of the year, compared to the original estimate of requirement of £209.422m (£139.422m capital programme and £70.000m capitalisation direction). The Strategy currently forecasts that the level of reserves and balances in the medium term allows for internal borrowing (use of internal resources such as useable reserves and temporary working capital) of at least £75.000m in 2026/27. It is therefore expected that new borrowing of £136.558m may be required to support the capital programme and capitalisation direction during 2026/27, although the timing of actual borrowing will be considered in the context of the wider treasury management position and underlying economic environment.
• p28The table below shows that the Council is operating within the Operational Boundary and Authorised Borrowing Limits set within the Treasury Management strategy and has sufficient headroom to cover any unforeseen borrowing need arising from the year’s capital programme.