SIC reserves reach £300m

SIC executive finance manager Jonathan Belford.

THE VALUE of Shetland Islands Council’s stock market investments has hit the £300 million mark for the first time in many years.

Figures going before the local authority’s policy and resources committee next Tuesday (30 August) show the SIC’s reserves rose by £15 million in the three months to the end of June.

During that period £2 million was withdrawn to support council spending, meaning the investments rose from £287 million to £300 million.

Despite a long-running and UK-wide clampdown on public spending under successive Conservative governments since 2010, recent years have seen the SIC restore a healthier financial position following many years of overspending.

Executive finance manager Jonathan Belford said the latest figures reflected strong investment returns on the equity and bond markets “despite the uncertainty caused by the European referendum”.

His report to councillors said equity markets were on the rise leading up to the 22 June referendum, and while the UK market slumped after the 52-48 vote to leave the European Union, there was still a positive return over the three months.

Belford’s medium-term financial plan for the local authority estimates that an anticipated annual return of 7.3 per cent on investments enables the council to draw down £12 million a year from reserves to fund spending on services and capital projects.