Local Government: Debts
The question
To ask the Secretary of State for Housing, Communities and Local Government, pursuant to the Answer of 20 January 2025 to Question 23337 on Local Government: Debts, what discussions she has had with local authorities on the allocation of council debt following local government reorganisation.
Answered by Jim McMahon
It is the responsibility of councils to manage their budgets, and it is standard for councils to borrow and to hold debt, which they will do in the normal course of business. Local government re-organisation does not change this.
Previous Secretaries of State used statutory powers to intervene in a small number of councils failing their Best Value Duty partly associated with high levels of unsustainable debt.
We will work with local leaders to explore how best to support local government reorganisation where there has been failure. We will continue to work with Best Value Commissioners in these councils to support the councils’ financial recovery.
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