Wolverhampton Council set to owe more than £1bn - WATCH
Debt will rocket above an ‘eye-watering’ £1 billion in two years at Wolverhampton Council.
But despite it spiralling, the message from council leader Roger Lawrence was ‘don’t panic.’
Gobsmacked opposition Tory councillors said residents would be demanding to know where all the money had gone amid cutbacks, which includes the switch to fortnightly bin collections.
But Councillor Lawrence launched a strong defence of the council’s borrowing, saying he was not alarmed.
WATCH: Council debt hitting £1bn
He added there were no plans ‘at the moment’ to sell off key assets such as the Civic Hall but naming rights would be considered for the venue.
The council boss also stressed the authority remained below the borrowing limit – but only by £200 million.
Chiefs say total debt this financial year will reach nearly £900m and forecast debt will rise by nearly £278m, reaching £989m next year before soaring above £1bn in 2020-21 – equivalent to around £4,000 extra debt per man, woman and child in the city.
But Councillor Lawrence insisted major investment in the city, such as the i9 and i10 developments, was only possible if the council borrowed large sums of money.
He said: “All councils borrow to invest in assets. Schools, roads and leisure centres come from capital borrowing and are paid off over the lifetime of the assets. The council has a large number of assets – significantly larger than its debt.
“We are still under the limit of borrowing. By 2020/21 it will be £1.2bn and we will be under the limit by just short of £200m.”
Councillor Lawrence added: “People need to know there is a very clear policy of invest to save. We are investing money to reduce the burden on council taxpayers over the years. The income it is generating will be greater than the cost of borrowing.”
But Councillor Chris Haynes, deputy leader of the Conservative Group, said: “These sums are simply eye-watering. The levels of debt that Labour has built up in Wolverhampton over decades, through capital project mismanagement and sheer fiscal incompetence.
"With the amount of derelict buildings and wasteland blighting the city, and council tax bills continuing to rise, people will rightly be asking where has all this money gone?”
