Indebted council set to increase borrowing limits
Councillors at the second-most indebted council in the country are being asked to increase the authority's borrowing levels.
Spelthorne Borough Council has borrowing of £1.1bn but breached one of its borrowing limits on 1 April by £2.6m.
A council meeting on Thursday will be asked to approve an increase to two borrowing limits, to "deal with the changes in external economic factors".
According to a council spokesperson, the borrowing increase does not relate to the council's investment assets but to financing the completion of a new leisure centre.
Spelthorne is one of three borough councils in Surrey to build up some of the biggest debts per person in the UK.
A BBC report in January showed Spelthorne was second in the country with average debts of £10,415 per person.
Debt at Woking was equivalent to nearly £19,000 per person, the highest in the country.
Runnymede was fifth, with £7,270, behind Warrington and Thurrock in Essex.
'Headroom'
The two debt levels councillors will consider include an "operational boundary" for external debt, which is an estimate of the maximum level of external debt.
This number is lower than the other boundary to be increased, which is called the "authorised limit" for external debt.
A council's authorised limit, according to meeting documents, is "certainly not a limit up to which an authority will expect to borrow on a regular basis".
This debt level should give "headroom" over and above the operational boundary, in order to account for issues such as short-term council loans.
Councillors will be asked to increase the operational boundary for external debt from £1bn to £1.1bn and the authorised limit for external debt from £1.1bn to £1.2bn.
A Spelthorne spokesperson said the borrowing increase was for 2024-25 and that borrowing would then fall.
They said the "bulk" of the council's borrowing was taken out in 2016-18 for property purchases, which deliver a budget surplus each year.
They added: "Whilst we carefully focus on risk mitigation, particularly through use of the sinking fund reserves built up from setting aside some of the investment rental income each year, we are comfortable with our debt position."
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