WARRINGTON Borough Council insists it is committed to being a ‘responsible investor at all times’ – and it has identified climate change as a ‘systemic financial risk’.
The council’s treasury management strategy for 2023-24 will come before the audit and corporate governance committee at its meeting next Thursday.
The committee is recommended to consider the strategy, and subject to any amendments it is set to recommend that the council approves the strategy at its meeting on February 27.
Another recommendation is for the committee to recommend that the council adopt the revised 2021 Chartered Institute of Public Finance and Accountancy’s code of practice on treasury management in local authorities, the treasury management code.
The treasury management strategy document says the council is ‘committed to being a responsible investor at all times’.
It adds: “Responsible investment means to recognise the importance of the long-term health and stability of the financial markets, and to understand that this depends on key external non-financial factors, such as the environment, social stability and strong governance.
“The council’s objective is to recognise all these risks, to mitigate them where possible and thereby improve the security of its portfolio in the long-term.
“Within these risks, the council has identified climate change as a long-term, material and systemic financial risk with the potential to significantly impact the treasury portfolio and the council’s financial resilience over time.”
Furthermore, the document states that, therefore, the council seeks to ‘minimise exposure to counter-parties and investments heavily impacted by climate change risk’, increase exposure to sectors, counter-parties and investments, such as renewables, whose activities ‘aid the transition to a lower carbon world and economy’, and contribute ‘meaningfully’ to an improved economically sustainable future locally and nationally, without ‘sacrificing security’.
But it says ‘this is not to downplay other non-financial risks’.
Cllr Bob Barr, leader of the town’s Liberal Democrats, says Liberal Democrats believe in properly funded public services.
He added: “Since 2010, Government funding cuts have placed services at risk. This has forced authorities run by all political parties to find creative ways of increasing revenue and minimising costs.
“We support the treasury management strategy being pursued and the recommendation to adopt the Chartered Institute of Public Finance and Accountancy code of practice. It is good practice to have two independent members of the audit and corporate governance committee, a matter on which Labour have been dragging their feet for years.
“Such a strategy should be considered by an all-party board taking appropriate external advice and should seek to achieve cross-party consensus. It should not be a stage for destructive negative attacks offering no positive suggestions.
“The Warrington Conservatives have chosen to make treasury management a battlefield. Regardless of their own Government’s economic failures, and the financial chaos found in many Conservative run authorities, they criticise officers and the administration in Warrington without offering any positive alternatives.
“Liberal Democrats have criticised riskier and more secretive investments, such as those with Redwood Bank and Together Energy, but support the treasury management policy and welcome the opportunity for cross-party involvement in treasury management briefings.
“We are satisfied that appropriate due diligence is carried out before investment decisions are taken and support the increasing emphasis on ethical and green investments which will contribute towards our climate change objectives.”
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