COUNCILS have been accused of saddling future generations with today’s debts, after new research suggested the country’s local authorities have long-term liabilities of more than £180bn.
The Taxpayers’ Alliance today (Thursday, June 26) claims local authorities’ long-term liabilities, such as long-term borrowing and pension scheme deficits, rose by eight per cent last year, taking the total to £2,828 for every person in the UK – and almost seven times the annual total council tax take.
In the North-East and North Yorkshire, the total long-term liability is £11.1bn, or £2,784 for every person, while long-term borrowing stands at £4.3m.
Durham has the most long-term liabilities (£1.48bn), while Newcastle has the highest long-term borrowing (£536,233).
Five of the region’s councils, Darlington, North Tyneside, Redcar and Cleveland, Craven and Ryedale, have higher long-term liabilities than long-term assets.
Nationally, 38 councils have long-term liabilities of more than £4,000 per resident and Birmingham has the biggest total, at almost £6bn.
Jonathan Isaby, chief executive of the Taxpayers’ Alliance – an 80,000-supporter group which campaigns for lower taxes and public spending, 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 card.
“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.”
However, the Local Government Association – which represents councils, hit back, calling the report misleading.
A spokesman said: “Unlike central government, councils can’t borrow money to meet their day-to-day running costs.
“Instead, council borrowing is used to meet the cost of long-term investments, such as key infrastructure projects including new schools and transport links, which ensure taxpayers are able to continue benefitting from high quality services.”
The Alliance singled out South Tyneside, which has the highest long-term liabilities and long-term borrowing per resident of anywhere in the region, for criticism, for allegedly spending £250,000 attempting to uncover the identity of Mr Monkey, an anonymous blogger who was criticising council bosses for wasteful spending.
A council spokesman said it ensured its long-term borrowing was affordable and sustainable and its liabilities included the local government pension scheme, the terms of which are set at a national level.
He added: "Council took legal action in the Mr Monkey blog case because it has a duty of care to protect its officials from the kind of intimidation and harassment caused by this malicious and libellous blog, which, if unchallenged, would have seriously damaged the reputations of innocent people."