Current borrowing and investments
We use financial investment as a way of creating income. Our investment income gives us extra funds for services. Investment income has been important as it enables us to provide more services without raising levels of council tax.
Within strict financial rules, we borrow money to put towards careful investments of a capital nature. Within these rules, we may also invest some of our 'surplus cash flow' – that is, when there's more money in our accounts than we need for day-to-day costs, such as when we've received a lot of income.
All amounts borrowed must be repaid.
The tables below give a summary of our borrowing and our investments, shown in millions (m). The following abbreviations are used in these tables:
- LOBO – this means 'lender option borrower option', a type of long-term borrowing provided by banks where the loan contract runs for between 40 and 70 years
- PWLB – this is the 'Public Works Loan Board', a government body that provided loans to local council and other public sector organisations
- CCLA – this is 'Churches, Charities and Local Authorities', a fund management organisation that manages investments for charities, religious organisations, and the public sector
Summary of borrowing
| Borrowing | Up to 31 December 2021 |
|---|---|
| Long-term market loans (LOBO) | £29.0m |
| Long-term PWLB loans | £196.3m |
| Long-term market loan re-investments | £85.0m |
| Long-term PWLB re-investments | £427.0m |
| Temporary market loans re-investments | £414.2m |
| Other temporary market loans | £323.3m |
| Total borrowing | £1,474.8m |
Summary of investments
| Investments | Up to 30 December 2021 |
|---|---|
| Overnight investments | £20.0m |
| Short-term investments | £1.3m |
| Capital investments | £823.2m |
| Non-capital investments | £82.8m |
| Fund managers (CCLA) | £104.0m |
| Total investments | £1,031.3m |
Summary of investment types
The table below shows our investment types and principal investment amounts – that is, the original amounts invested – as of 31 December 2021.
| Investment type | Maturity range | Average return | Principal amount invested |
|---|---|---|---|
| Renewable energy | 1 to 23 years | 5.80% | £749.51m |
| CCLA property fund | Open-ended | 4.50% | £103.00m |
| Other capital investments, including Thurrock Regeneration Limited | 1 to 9 years | 7.00% | £62.57m |
| Total capital investments | 5.76% | £915.08m | |
| Other long-term investments | 1 to 4 years | 5.67% | £105.20m |
| Total overall | 5.72% | £1,020.28m | |
Net debt
Our total net debt below is the difference between the total amounts borrowed and the total amounts invested.
| Net debt | Up to 30 December 2021 |
|---|---|
| Total net debt | £443.5m |