Government warns Runnymede Borough Council over debts

Runnymede Borough Council has "significant debt", the department of levelling up says

Runnymede Borough Council has been issued with a government warning over its "significant debt" and over reliance on commercial income.

The Department for Levelling up, Housing and Communities (DLUHC) said the council had borrowed 71 times its core spending power.

The council said borrowing had been locked in when interest rates were low.

The government issued the authority with a Best Value Notice, which states its concern with the authority.

The notice also sets out its expectations for improvement.

Suzanne Clarke, DLUHC's deputy director of finance, said: "The authority has significant debt relative to its size, as of 31 March 2023, it had borrowing 71 times their core spending power, which has been used predominantly to invest in the authority's property portfolio. 

She said commercial income "represents a substantial revenue source" which "exposes the authority to significant financial risks should anticipated income fail", according to the Local Democracy Reporting Service.

Responding to the notice, Tom Gracey, leader of the borough council, said: "It is right that effective scrutiny must be in place around investment and spending decisions to ensure value for money.

"I am proud of the track record we have delivered in Runnymede in not only providing investment in our social housing, regeneration across communities, and funding services valued by our residents, but also in our sound risk and financial management."

Andrew Pritchard, the council's chief executive, said most borrowing had been locked in while interest rates were at a historic low.

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