Councils across the UK added £7.8bn to their debt in the space of a year, new figures show.
Analysis of Ministry of Housing, Communities and Local Government (MHCLG) data by the BBC’s Shared Data Unit reveals local authorities now owe a combined £122.2bn. That is the equivalent of £1,791 per resident, as of April 2025.
Isle of Wight figures
The Isle of Wight Council’s total debt at the end of Q4 2024/25 stood at £182,414,000.
That represents an increase of £862,000 over the year. On a per-person basis, total debt now amounts to £1,294.58, up £6.12 compared with the previous year.
The table below shows the comparison between the Isle of Wight and councils with the largest levels of debt per person Q4 24-25.
| Local authority name | council type | Total debt at the end of Q4, 23-24 | Total debt at the end of Q4, 24-25 | Difference | Percentage rise/fall in debt | Total debt per person at the end of Q4, 23-24 | Total debt per person at the end of Q4, 24-25 | Debt rise per person |
|---|---|---|---|---|---|---|---|---|
| Isle of Wight | Unitary Authority | £181,552,000 | £182,414,000 | £862,000 | 0.47% | £1,288.46 | £1,294.58 | £6.12 |
| Councils with the largest levels of debt per person Q4 24-25 | ||||||||
| Woking | Non-metropolitan District | £2,103,210,000 | £2,155,641,000 | £52,431,000 | 2.49% | £20,100.25 | £20,601.33 | £501.08 |
| Spelthorne | Non-metropolitan District | £1,084,754,000 | £1,065,761,000 | -£18,993,000 | -1.78% | £10,434.94 | £10,252.24 | -£182.71 |
| West Dunbartonshire | Scottish council area | £718,673,000 | £788,616,000 | £69,943,000 | 9.73% | £8,097.72 | £8,885.81 | £788.09 |
| Warrington | Unitary Authority | £1,891,744,000 | £1,575,609,000 | -£316,135,000 | -16.80% | £8,906.98 | £7,418.51 | -£1,488.47 |
| Barking & Dagenham | London Borough | £1,321,652,000 | £1,523,750,000 | £202,098,000 | 15.53% | £5,945.14 | £6,854.23 | £909.09 |
| Aberdeen | Scottish council area | £1,381,758,000 | £1,518,257,000 | £136,499,000 | 9.88% | £6,066.99 | £6,666.33 | £599.34 |
| Runnymede | Non-metropolitan District | £627,615,000 | £597,712,000 | -£29,903,000 | -4.76% | £6,939.42 | £6,608.79 | -£330.63 |
| Highland | Scottish council area | £1,132,444,000 | £1,294,144,000 | £161,700,000 | 14.34% | £4,791.79 | £5,476.00 | £684.21 |
| South Tyneside | Metropolitan District | £678,508,000 | £738,508,000 | £60,000,000 | 8.84% | £4,545.51 | £4,947.46 | £401.96 |
| East Lothian | Scottish council area | £493,789,000 | £559,402,000 | £65,613,000 | 13.29% | £4,341.38 | £4,918.25 | £576.87 |
What councils borrow for
Councils are able to borrow funds to invest in projects such as schools, leisure centres and theatres.
They can also borrow to purchase property that generates income over and above the repayments required.
Concerns over short-term loans
The recent rise in debt is being driven in part by a near tripling of short-term lending from central government.
In some cases, this type of borrowing has been used to plug gaps in revenue budgets rather than fund investments and town centre improvements.
“Extremely worrying” levels
Experts have voiced concern about the scale of local authority borrowing.
Jonathan Carr-West of the Local Government Information Unit (LGIU) said the trend was “extremely worrying.”
He added,
“That is not a sustainable system. As one local government finance officer said to me, it’s essentially payday loans for local governments.
“I don’t think the government would say that’s it’s long-term ambition.
“They would say that is what we have had to do to paper over the cracks while we introduce a new funding system for local government.”
