North East’s Local Council Debt Revealed

National World - LocalTV

Rising debt levels across the North East have put local councils under renewed scrutiny with new figures revealing that the region now owes more than £4.3 billion. That’s an increase of nearly £200 million in just 12 months

Transcript

00:00Rising debt levels across the North East has put local councils under renewed scrutiny,

00:05with new figures revealing that the region now owes more than £4.3bn. That's an increase

00:11of nearly £200m in just 12 months, and on average it amounts to over £2,500 of debt

00:17per resident. It's a complex picture and one that reflects growing financial pressures

00:22on councils trying to deliver essential services, while also investing in long-term regeneration.

00:28The latest figures show that all seven councils across Northumberland, Tyne and Weir and County

00:33Durham have seen changes in their borrowing, with Northumberland County Council holding

00:39the highest overall debt at £834.5m, following a sharp £93m rise over the past year.

00:48But when it comes to debt per person, the highest by far is South Tyne side, where the figure

00:53now stands at just under £5,000 per resident. That's six times more than County Durham,

00:59which has the lowest per capita debt in the region.

01:02So why are councils borrowing? The short answer is that they have to. Government funding has

01:08been cut drastically over the past 15 years, and borrowing is one of the few ways councils

01:14can still invest, whether in new schools, leisure centres, transport, or even commercial ventures

01:20like energy schemes and office spaces. In North Tyne side, the council borrowed £28.5m last

01:26year to buy its own headquarters, claiming it will save more than £11m over the next two

01:31decades by ending its lease. Officials say their borrowing remains well within national rules,

01:38and is tied directly to improving local infrastructure, not to cover day-to-day services.

01:43In South Tyne side, councillors point to major improvements funded through borrowing, such

01:49as upgrading leisure facilities and cultural centres. But rising interest rates means the

01:54council is now pulling back on new loans. In Northumberland, council leader Glen Sanderson

02:00says the figures can be misleading, arguing that size and ambition vary widely between councils.

02:07He insists Northumberland's borrowing is under control and tied to high impact projects,

02:12including transport schools and a £10 billion investment deal for the county. But what

02:17do you think? Are you happy with the progress of your local council in the last year? What

02:22should local councils be spending their money on, and is the debt worth it?

02:26I think North Yorkshire are working really hard to try and make a difference, but they have

02:31got a big cost-cutting exercise. But it is a massive area that they're now having to cover.

02:39But yes.

02:41Yeah, money's tight everywhere, isn't it? So as Rachel says, we have to grow the economy.

02:47It's because central government has been taking away for decades. So it really doesn't matter

02:56who you vote for. There is no money.

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