Carlisle City Council refinances 'burden' loan

The money was taken out to revamp the Raffles Estate (pictured in 2009) built in the 1920s and 30s

A £15m loan to regenerate a housing estate which cost the city council more than double that in interest payments has been refinanced.

Carlisle City Council took out the interest-only loan in 1995 - when it was run by Labour - to revamp the run-down Raffles estate.

With interest amounting to £32.5m the now Tory-run council has described it as a "tremendous burden".

It has taken out finance to clear both the interest and the initial loan.

Labour has previously said the loan represented a "good deal" at the time with an 8.75% interest rate and had cross-party support.

The Local Democracy Reporting Service said that at a virtual meeting of Carlisle City Council's executive, Conservative leader John Mallinson said the refinancing would alleviate what had been a "tremendous burden" for 25 years.

Deputy leader Gareth Ellis said: "What happened in 1995 was the sum was borrowed without any means to pay it off, so here we are now a generation later having to refinance this loan.

"This time we won't hand that burden onto our children and grandchildren; when this loan is finished, it will be paid off, unlike our predecessors'."

Conservative leader of the council John Mallinson said the refinancing would alleviate what had been a "tremendous burden" for 25 years.