Ashington Town Council set to put public money to work with new treasury management plan
Ashington Town Council could earn thousands of pounds a year in interest on its reserves — at lower risk than its current banking arrangements — under a new treasury management plan recommended by the Council's Finance and General Services Committee, which goes to Full Council for approval next week.
The proposal is the final step in a systematic review of the Council's finances which began in 2022, when the Council first allocated its reserves to specific purposes — setting money aside for the future replacement of play areas, elections, allotments and other known costs — followed by the adoption of a formal Reserves and Contingency policy. The proposed Investment Strategy and Treasury Management Policy would complete that work.
Under the plan, £625,000 of the Council's funds would be placed in the Public Sector Deposit Fund, a AAA-rated fund created at the invitation of the Local Government Association specifically for councils, following the banking failures of 2008. The fund holds only straightforward cash deposits spread across a range of highly rated banks, and the Council would be able to access its money on the same day it is needed. It is used by more than 500 town and parish councils across the country, as well as the Local Government Association, the National Association of Local Councils and the Society of Local Council Clerks — which invest their own funds in it.
The change is expected to earn the Council in the region of £20,000 a year in interest — money that currently goes unearned — while spreading the Council's funds across many institutions rather than holding everything in a single bank account. Every pound earned would be a pound that supports local services without being asked of the taxpayer.
Cllr Lynne Grimshaw, Chair of the Finance and General Services Committee, said: "Residents rightly expect us to spend public money wisely — but good stewardship doesn't stop there. We also have a duty to look after the money we hold and to make it work for Ashington. This has been a step-by-step journey since 2022: first knowing exactly what our reserves are for, then protecting them properly, and now making them earn their keep. The Committee was pleased to recommend this plan to Full Council — careful, sensible management of the town's money, in exactly the same fund trusted by hundreds of councils and our own national bodies."
Sarah Eden, Executive Officer and Responsible Financial Officer, said: "Security comes first, then access, then return — in that order. This fund was built for councils, by the sector, after the lessons of 2008, and it would let us earn a proper, risk-balanced return without locking a single pound away. The interest earned would go back into supporting services for the people of Ashington and saving towards assets."
Full Council will consider the Committee's recommendation at its meeting on 28th July 2026. The Council's day-to-day banking arrangements would be unchanged, and all movements of funds would be reported to the Finance and General Services Committee.
