Scottish council debt rose to £19bn in 2020

Scottish local authorities had debt of £19.3 billion at March 31, 2020, an increase of 6.3% from £18.2 billion at March 31, 2019, according to new data from the Scottish Government.

In 2019-20, local authorities made debt repayments of £624 million, the data shows.

The data is included in the latest figures from Scotland’s Chief Statistician on local government expenditure and income in 2019-20.

The Scottish Government said the figures provide a comprehensive overview of the financial activity of local government “including revenue expenditure and income; capital expenditure and financing; reserves; debt; and pensions.”

The Scottish Government said that in 2019-20, net revenue expenditure of Scottish local authorities was £11 billion, an 8.1% increase from £10.2 billion in 2018-19.

Education and social work were the services with highest net revenue expenditure, with £5.3 billion and £3.4 billion respectively.

“Local authorities use general funding to meet their net revenue expenditure on services and any non-service specific revenue expenditure,” said the Scottish Government.

“In 2019-20, general funding was largely made up of General Revenue Grant (GRG), £6,937 million; Non-Domestic Rates, £2,853 million; and council tax, £2,493 million.

“Capital expenditure is expenditure that creates the buildings and infrastructure necessary to provide services, such as schools and roads.

“Due to the nature of capital expenditure, it can fluctuate substantially between years.

“Local authorities incurred £3,794 million of capital expenditure in 2019-20, a 27.4% increase from £2,977 million in 2018-19.

“Local authorities can finance capital expenditure in a number of ways.

“In 2019-20 the main sources of capital financing were grants and contributions, £1,297 million; and borrowing, £1,128 million.

“Usable reserves are local authorities’ surplus income from previous years.

“This can be used to finance future revenue or capital expenditure.

“At 31 March 2020, local authorities held £2,708 million of usable reserves, an increase of 4.7% from £2,586 million held at 1 April 2019.

“When local authorities borrow money or use credit arrangements to finance capital expenditure, a debt is created.

“Local authorities have to repay debt from future revenues.

“At 31 March 2020, local authorities had debt of £19,377 million, an increase of 6.3% from £18,224 million at 31 March 2019. In 2019-20, local authorities made debt repayments of £624 million.”

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Mark McSherry
Dalriada Media LLC sites are edited by veteran news journalist Mark McSherry, a former staff editor and reporter with Reuters, Bloomberg and major newspapers including the South China Morning Post, London's Sunday Times and The Scotsman. McSherry's journalism has also appeared in The Washington Post, The Guardian, The Independent, The New York Times, London's Evening Standard and Forbes. McSherry is also a professor of journalism and communication arts in universities and colleges in New York City. Scottish-born McSherry has an MBA from the University of Edinburgh and a Certificate in Global Affairs from New York University.