Hampshire County Council £197m in debt according to new data

The information comes from the Department for Levelling Up and shows that UK councils owe a combined £97.8bn to lenders, equivalent to £1,141 per resident, as of September 2023.

The high levels of local authority debt will see residents face impacts on local services.

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According to the data, Hampshire County Council has amassed £197,402,000 in debt, equivalent to £140 per resident.

Hampshire County Council Offices (Image: Newsquest)Meanwhile, Test Valley Borough Council has amassed £6,421,000 in debt and Winchester City Council has amassed £161,722,000, equivalent to £49 per resident and £1,264 per resident respectively.

The data showed no debt associated with Basingstoke and Deane Borough Council.

Winchester Guildhall (Image: Contributed)A spokesperson for Winchester City Council said: “The borrowing refers to the refinancing of Winchester’s 5,000 council homes in 2012 when the Government’s previous subsidy system for council housing was abolished. It is self-financing, paid for via the rent from tenants, not by council taxpayers and is part of the Council’s separate Housing Revenue Account. It works out at about 30 per cent of the value of the houses.  The loan is via the Public Works Loan board which offers long-term borrowing for councils at low-interest rates.”

A spokesman for Test Valley Borough Council said: “The debt in question is the result of proactive decision-making on our part, to finance two capital projects through affordable, fixed-rate loans with the Public Works Loan Board. These relate to the re-development of the Andover Leisure Centre and the purchase of property in Andover in 2019.

“The loans were taken out for fixed terms at fixed interest rates, with the full cost of both built into council budgets. Both loans are subject to annual repayments of both capital and interest, so the outstanding amounts will gradually reduce over time and are being actively managed in an affordable way. The interest rate payable on the loans is far more favourable than would be currently available, due to the extremely cheap borrowing conditions at the time they were taken out.

Test Valley Borough Council offices (Image: Contributed)“Each loan had a supporting business case that demonstrated the affordability of borrowing in the context of the wider projects. The borrowing figure quoted should also be set in the context of the £90M+ in cash and equivalent investments that were being managed by the council at that time.”

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A spokesperson for Hampshire County Council said: “

Most local authorities hold debt. For Hampshire County Council, as one of the largest county councils in the country, serving 1.4 million residents, this must be seen in the context of a £2.4bn gross budget and the fact that we have around £0.5bn of investments. The financial resilience index produced by the Chartered Institute of Public Finance and Accountancy shows Hampshire as low risk for both interest paid as a proportion of the total budget and the gross level of its external debt.

“Repayments are undertaken in line with usual procedures.”

A spokesperson for the Department for Levelling Up, Housing and Communities said: “Councils are ultimately responsible for their own finances, but we are very clear they should not put taxpayers' money at risk by taking on excessive debt.

“The Levelling Up and Regeneration Act provides new powers for central government to step in when councils take excessive risk with borrowing and investment. We have also established the Office for Local Government to further improve accountability across the sector, which will help detect emerging risks and support councils to continue delivering key public services.”

Hampshire County Council has been reached for comment.