Scottish Borders Council borrowed another £7.5 million from the UK Public Works Loans Board (PWLB) only a week before local authority leaders warned there would be more spending cuts and council tax rises during the coming five years.
The latest multi-million pound borrowing spree by SBC on the 23rd of last month - the maturity date, according to the PWLB's latest list of loans is September 2034 - lifts SBC's indebtedness to the lending authority above the £167 million mark. Apparently the 'new' money will be used within three months with the council agreeing to pay interest of 1.67% on the loan.
Total interest payments on loans made by the cash-strapped council in 2018/19 soared to £14.366 million, up from £11.681 million in the previous financial year. Those figures were disclosed in SBC's accounts.
Earlier this week, at a council briefing, Councillor Shona Haslam (Conservative), the council leader claimed: “There is no denying it is very difficult to balance the books every year especially when we have increased demand for services, an increasing older population and services spread across such a vast rural area.
“We are currently looking at delivering savings of over
£5 million every year for the next five years. That’s not going to be easy, so
we need to consider where we spend money, how we do things differently and what
we simply can’t deliver any more."
There was no mention of the £7.5 million loan arranged with PWLB a week earlier.
Mrs Haslam announced the introduction of a so-called online priorities tool to be used by taxpayers over the coming months in the lead up to the finalising of next year's council budget.
She said:“The online tool we are launching will help us to understand
where people in the Borders would like services protected in their own area,
and will also help us to have ongoing conversations in communities about how we
can do things differently and/or where there are opportunities for communities
to play their part.
“We remain committed to delivering high quality services for
all our residents, from the youngest to the oldest, as well as making the most
of the opportunities that the Borders has. It is not all about cost cutting, it
also means investing carefully and delivering a range of projects that support
and enhance services, our towns and villages.” She could, perhaps, have added borrowing to the list of commitments.
Councillor Robin Tatler (Conservative), executive member for finance at SBC declared: “We know everyone has different opinions around where money
should be spent and we hope people can take the time to tell us where their
priorities are. It’s an ongoing challenge when it comes to setting our
budget, with a huge number of demands across a wide range of services.
“We remain ambitious though, and while we do have challenges
we still have a five-year revenue budget of over £1.4 billion and a £386 million
10-year capital budget.
“Given the challenges, we need to do things differently so
it is vital that we get residents’ views on how where they would prioritise
things that matter to them in their area. This does not necessarily mean we
will put more money into these areas but it certainly means that we would
consider protecting them."
And local Westminster MP John Lamont (Conservative) told the Border Telegraph: "The situation is so serious
that council officials are pushing for council tax to rise significantly each
year for the next five years."
The Conservative-led administration at SBC under the leadership of Councillor Haslam which took office in 2017 has presided over a 25% increase in the level of debt owed to the PWLB.
From 2012 to 2016 the figure remained static at £127.6 million despite the Scottish Government imposing a council tax freeze. Then, in 2017, the total climbed to £139.6 million, followed by another upwards move to £149.6 million in 2018. The recently audited accounts for 2018/19 include a figure of £159.6 million for PWLB debt.
Between 2014 and 2019 the council's total borrowing increased by 13.7% from £175.2 million to £199.2 million, having reached £202.7 million in 2018.
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