WEYMOUTH and Portland Borough Council has one of the worst records in the country for liabilities compared to assets
Its liabilities mount up to more than 150 per cent the worth of its assets – and taxpayers are footing the bill.
Shock figures released today show there is a £30m deficit between the council’s long-term liabilities and its assets. Its long-term borrowing in 2012-13 was £27m, an increase of almost £300,000 on the previous year.
And all this debt works out as £1,250 for every resident in the borough.
The authority’s liabilities, in comparison to its assets, is the sixth worst in the UK. Its long-term liabilities rack up to £81m, whilst its assets are worth just £51m.
Authorities have been accused of using council taxes to ‘service debt interest rather than for frontline services.’ Jonathan Isaby, chief executive of the TaxPayers’ Alliance, which collated the data, said: “It is nothing short of immoral for councils to pile further debt on the next generation.
“Britain’s public finances are in real trouble, and local authorities can no longer avoid tough choices by putting the bill on taxpayers' credit cards.
“Councils must look again at overgenerous pensions and wage a war on waste, or Britain’s debt burden may soon become too heavy to bear.”
But Jason Vaughan, council director for resources, has called the figures ‘alarmist’ and ‘manipulated’.
He said the authority’s investments ‘more than match’ its borrowing and it has £10.5m in reserves.
Mr Vaughan added: “The debt has not changed for a number of years.
“What the TaxPayers’ Alliance is comparing is a bit like adding apples and bananas and making carrots.”
He said the figures have been taken from external auditors which look at the authority every year and have deemed it in a fit and proper state to continue. He added: “(The TaxPayers’ Alliance) has manipulated certain figures to create headlines that alarm people.”
He said Weymouth and Portland Borough Council is ‘in a stable financial position.’ Liabilities are the authority’s legal debts or obligations and are settled over time through the transfer of money, goods or services.
Liabilities include loans, accounts payable, mortgages, deferred revenues and accrued expenses.
The figures show Dorset County Council has more than £661million of liabilities.
This works out as £1,594 for every resident of the county.
It says it borrows ‘in line with the Chartered Institute of Public Finance and Accountancy (CIPFA) prudential code to ensure that borrowing is sensible, prudent and sustainable in the interests of delivering infrastructure and capital projects for the benefit of Dorset’s 400,000 plus residents’ and that interest is funded from revenue budget.
West Dorset District Council has liabilities of just 29 percent of the worth of its assets and is in the top 15 most solvent authorities in the country.
HOW THEY RANK
Weymouth and Portland
Long-term liabilities- £81m
Long-term borrowing- £28m
Long-term assets- £51m
Dorset County Council
Long-term liabilities - £661m
Long-term borrowing - £171m
Long-term assets- £946m
West Dorset District Council
Long-term liabilities- £29m
Long-term borrowing- £6m
Long-term assets- £100m