The Isle of Wight council carries long-term loan debts to the equivalent of more than £1,000 per Islander, latest figures have revealed.
A national investigation by the BBC Shared Data Unit revealed how much debt local councils are in — reporting a staggering UK-wide £97.6 billion as of September 2023 – averaging out at £1,455 per person.
At the end of 2023, the Isle of Wight council owed £162.9 million in long-term loans — around £1,156 per Islander.
Woking Borough Council has the highest accumulated debt — standing at nearly £2 billion pounds and equating to around £18,750 per resident.
Some dates back to the 1990s
The amount is calculated by dividing the council’s total debt by the number of people who live here (based on the Office for National Statistics’ entire Island population data).
Some debt dates back to the 1990s, when the authority took out long-term loans and continues to pay back the borrowed cash.
Invested in ‘essential’ capital projects
A spokesperson for the Isle of Wight council said the money has been invested in ‘essential’ capital projects, acquisitions and other investments, not spent on day-to-day services.
The total amount of long-term debt has fallen, over the last six months, because a £5 million bank loan has been paid off, saving the authority about £76,000 a year.
30 historic long-term loans
More than 30 historic long-term loans came through the Public Works Loan Board (PWLB) – an arm of the Treasury.
As of March 2023, County Hall was paying off eight loans dating to the 1990s, 17 from the 2000s and nine taken up between 2016 and 2020, according to figures from the PWLB.
Some of the loans will mature this year, while others will take a further three decades. The longest loan repayment will run until 2055.
No new loans since 2020
No new long-term PWLB loans have been taken out since March 2020.
Any future borrowing would have to meet stringent rules, with costs covered by offset income or savings, said a spokesperson for County Hall.
Gov: Councils should not put taxpayers’ money at risk
A government spokesperson for the Department for Levelling Up, Housing and Communities said councils are ultimately responsible for their own finances, but it is very clear they should not put taxpayers’ money at risk by taking on excessive debt.
LGA: Investments encouraged by Gov
The Local Government Association (LGA), which represents authorities across the country, has called for the government to come up with a long-term plan to sufficiently fund local services.
A spokesperson for the LGA said,
“Councils have faced a choice of either accepting funding reductions and cutting services or making investments to try and protect them.
“This was an approach that was encouraged by the government.”
This article is from the BBC’s LDRS (Local Democracy Reporter Service) scheme, which News OnTheWight is taking part in. Some alterations and additions may have been made by OnTheWight. Ed
