CHESHIRE County Council has agreed a temporary change to its investment policy to help cope with the financialŠturmoil in the world money markets.
The authority – with £8.5m deposited with Heritable, a UK subsidiary ofŠLandbanski –ŠhasŠcarried out a review of treasury management and investment strategies.
Members expressed full confidence in finance officers who invested the cash with Heritable at least a week before its credit ratings began to fall on September 30.
Council leader Paul Findlow said: “The Local Government Association has confirmed that councils that investedŠbefore September 30 in accordance with guidelines acted prudently. There can be no criticism of that decision.
“We were, of course, not alone and the long list of investors has been well publicised. Indeed we believe the Audit Commission, the body responsible for scrutinising public expenditure, hadŠ£5m with Heritable and £5m with Landbanski!”
Cllr Findlow added: “There appears to be hopeful signs we will get at least some of our money back. We will be monitoring events very closely indeed.”
County finance officer Bill Tunnicliffe stresses the authority’s approach has always been to prioritise security over rate of return.
But current increasingly difficult conditions called for amendments enabling money to be placed with finance institution supported by the UK and Irish Governments.
These included six Irish Banks covered by Dail Eireann, and UK banks and building societies that have secured capital investment from Whitehall.
It will alsoŠmean more frequent use of the highly credit rated money market funds and the UK GovernmentŠDebt Management Account Deposit Facility, considered to be “of the highest quality and extremely secure.”