Cotswolds MP Sir Geoffrey Clifton-Brown has said the ‘reckless’ council is considering borrowing £76.5million to invest and will mortgage local taxpayers for a generation. The Tory MP raised concerns about Cotswold District Council’s proposals to fund a range of capital projects during a debate in the House of Commons last week.
The council’s plans include investment in green energy, economic development and £1.8m will be earmarked for social housing. But Sir Geoffrey fears the project could jeopardize the local authority’s finances.
Community Leveling Minister Kemi Badenoch said in her Wednesday evening speech that disproportionate levels of debt put councils at financial risk, citing recent examples of mismanagement by other councils.
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Sir Geoffrey, who is Deputy Chairman of the Public Accounts Committee, has recommended that the Government ban Public Works Loan Board lending for ‘exotic investments’, such as solar farm projects or commercial property investments, only for make a return on the investment.
He said: ‘The fact that I have raised the issue of the Cotswold District Council’s reckless £76.5million borrowing amount in the House is significant. Borrowing from the Public Works Loan Board at 3.3% will involve capital repayments of more than £3million a year for the next 25 years, which will likely have to be set off against the board’s current income.
“At the same time as it plans to borrow this excessive amount, the council is raising council tax by £5, an increase of 3.6%. This will clearly put the finances of the council and the taxpayers of the council at risk. Cotswolds mortgage for a generation. I urge Liberal Democrat advisers to think again about this reckless proposal.”
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However, District Council leader Joe Harris (LD, St Michael’s) said the MP was wasting parliamentary time playing party politics. He said Sir Geoffrey never voiced his concerns about it to himself or council officers.
Cllr Harris explained that the council plans to borrow money to invest in projects that will benefit the local economy and tackle the climate emergency. “These projects will also provide the Council with a financial return that will help support our budget in the future as we face further budget cuts from the government,” he said.
“All of these investments will be subject to an individual business case assessment which will be considered and approved by Cabinet or the full council. Other local councils, including Tory-run Gloucester and Tewkesbury, are following a similar path as ours on borrowing to invest; I don’t recall the Conservatives raising any concerns in these cases.
“What Geoffrey Clifton-Brown and the Tories won’t tell you is what their alternative is. This is because their alternative is to cut services people rely on, such as waste service, housing and community grants, and to lay off people working on the council’s priorities – tackling the emergency climate change, support our economy and provide affordable housing.