Planning to pay off £67m debt

OFFICERS at South Holland District Council are being urged to draw up a plan for how the council can best pay off the £67million debt it will soon be handed by the Government.

The debt will be passed to the council when the Government implements changes to the nation’s council housing tax bill, but the authority insists it will be better off in the long term.

The council is said to currently pay about £3.75m a year to the Government as part of the Housing Revenue Account (HRA). The HRA will be now scrapped, with the council taking on the debt instead.

Under the old deal the Government chose how to redistribute the cash it brought in but the new terms mean councils will have more control over their housing stock.

At last week’s cabinet meeting council leader Gary Porter brought up the issue of how that debt, set to land by next April, is repaid.

He suggested the authority could look to find a low interest loan to pay off the whole debt, at a rate that would leave smaller repayments in the long term.

Coun Porter even floated the idea of selling bonds to people in the district.

New head of finance Mark Finch suggested the council will need to assess the different funding options open to the authority but Coun Porter urged that work needs to be done quickly.

Coun Porter said: “We haven’t got long now. I don’t want to have to walk around the town and knock on the doors of high street banks saying ‘any chance you can lend me £60m?’

“This is a good deal for us but we still need to shop around and see where we are going to get the money from.

“There are going to be people sitting on lots and lots of big funds.”

Coun Porter reiterated the changes will not mean the council takes ownership of its housing stock.

He added that the fact that all councils will be looking for finance need not be a problem – with the chance to club together and get a better deal.