Kingston Council's Audit, Governance and Standards Committee has reviewed the local authority's borrowing strategy for the 2025/26 financial year, which saw a total of £379 million borrowed. This figure was £154 million lower than the council's capital financing requirement, a reduction achieved by utilising approximately £154 million of its cash reserves.
The committee reviewed the Treasury Management Annual Report for 2025/26, which highlighted a volatile market influenced by global events. Katherine Gray, Head of Pensions, Investments and Treasury, presented the report, noting that the council's borrowing strategy focused on minimising additional borrowing by using cash reserves and opting for short-term loans when borrowing was necessary. The volatile market during this period was influenced by Liberation Day
tariffs at the beginning of the year, which led to interest rate increases, and later by the conflict in the Middle East, which caused a spike in volatility and rates as inflation was thought to be under control.
On the investment side, the council achieved a return of 4.18%, exceeding the Sonia benchmark of 4.01%. The report also noted a change in treasury advisors, with ArlingClose appointed from April 2026, replacing MUFG. This change was due to the expiry of the contract with MUFG (formerly Link Group) at the end of March 2026. Following a procurement exercise, ArlingClose was appointed as the new treasury advisors.
Councillor Peter Higgins, Chair of the committee, questioned the use of reserves to pay off debt. Ms. Gray explained that while reserves are used to reduce borrowing, this does not drive the council's medium-term financial plan.
The committee's discussions and the Treasury Management Annual Report for 2025/26 can be found in the public reports pack for the Audit, Governance and Standards Committee meeting on Wednesday 24 June 2026. Public reports pack
