IT has been a busy few months for Warrington Borough Council, with intense scrutiny over its investments and debt totalling around £1.85 billion.

Here is a timeline of some of the key events.

September 2023

Warrington Borough Council’s level of debt is forecast to rise to £2.3 billion by 2026 – but it says its commercial approach is ‘unlikely to continue in the same way’.

The Labour-run council confirmed its current level of borrowing totals £1.8 billion.

It says this is currently estimated to be around £2.3 billion by 2026, but by 2026 the percentage of revenue funding spent on capital financing is ‘expected to decrease’ from seven per cent in 2023-24 to 5.83 per cent in 2025-26. Furthermore, it stated, as with all medium-term plans, this ‘remains under review’.

January 2024

Warrington Borough Council has the third highest average debt per person in the UK among councils – but bosses say its level of borrowing is ‘sustainable’.

BBC Shared Data Unit analysis of data by the Department for Levelling Up shows UK councils owe a combined £97.8 billion to lenders, equivalent to £1,455 per resident, as of September 2023.

The data shows that Labour-run Warrington Borough Council’s amassed debt for 2023-24, at quarter two, totalled £1,739,678,000.

It states the town has a population of 211,227 – and the average debt per person in the town totals £8,236.

April 2024

The then-Prime Minister Rishi Sunak hits out at Labour-run Warrington Borough Council for ‘racking up debt’.

The comment was made in the House of Commons during Prime Minister’s Questions. It followed a question from Warrington South Conservative MP Andy Carter.

The then-Prime Minister said: “This year the Government announced a further £600 million in extra funding for local councils, a real terms increase as it has done every single year of this Parliament.

“But we all know what happens when Labour are in charge, whether it is racking up debt in Warrington as my honourable friend said, the 21 percent council tax increase in Labour-run Birmingham, or indeed slashing services in Nottingham or, as I just said, higher crime on average in each Labour police and crime commissioner area.”

The then-Prime Minister added it is ‘crystal clear’ that whenever Labour are in charge, it is working people that ‘pay the price’.

April 2024

A Warrington Borough Council cabinet member says it is ‘simply not true’ that the council is heading towards bankruptcy amid a row over its debt.

Labour’s Cllr Denis Matthews said: “It is time we had an honest conversation about the council’s borrowing and investments. For too long the message pushed out by many is that Warrington Borough Council has massive debt, and that we are heading towards bankruptcy. This is simply not true.

“Your council has around £1.8bn of borrowing that is largely secured against assets. This borrowing has been used to create a diverse commercial investment portfolio. These assets generate over £23m in profit every year. This profit is taken after all the interest on the borrowing is paid, and a reserve is put to one side to cover us in the event of a rainy day.

“The simplest way to look at it is like if you had a buy-to-let mortgage, where the rent you received paid the mortgage and you were left with a profit each month that helped to pay your bills.

“The reality is that WBC has entered into these investments because the national Conservative Government told all councils that they should look to find other sources of income generation.

“Without finding other sources of income, further cuts in the essential services that are expected by all Warrington residents would have been unavoidable.”

March 2024

Warrington Borough Council says the ‘forecast maximum amount’ that it will borrow in the next three years totals £340 million.

This includes £179 million forecast for the year 2024-25.

Asked what its current level of debt is, the council says the position reported at quarter two (mid-year) was £1.798 billion.

It stated that this mid-year one given last year is the last one to have been reported.

The council says £340 million is the ‘forecast maximum amount’ that the council will borrow over the next three years, adding that it would depend on registered social landlords drawing down their loans, ‘as well as on any other schemes required to proceed, particularly invest to save schemes’.

The council says it anticipates its total level of borrowing will total £2.2 billion in 2027, ‘as agreed by council on 27 February, as part of the capital strategy alongside the budget approval’.

May 2024

The Government has ordered a ‘best value’ inspection into Warrington Borough Council amid its huge level of debt.

The minister for local government Simon Hoare has announced that the Government has ordered the inspection.

In a written statement, Mr Hoare said: “Warrington Borough Council is one of a small number of councils carrying the biggest risk in terms of debt leverage.

“The council is the most indebted unitary authority in England, with a capital finance requirement of £1.85 billion – 5.5 times its total service expenditure (as of March 2023).

“My department commissioned the Chartered Institute of Public Finance and Accountancy (CIPFA) to undertake a detailed review of Warrington’s capital finances.

“The review, which we are publishing today, found that their portfolio of debt-funded investments is very large and uniquely complex – to a degree that is concerning and puts the council at risk. The report also raises some concerns with decision-making, governance and oversight.”

A council spokesman said: “The inspection will undoubtedly have our full co-operation, and we will work positively, openly and at pace with the inspector.

“Equally, we welcome the CIPFA review report being made public, following their review in February 2023. We have supported the report being made public since receiving the draft report in September 2023.

“While DLUHC recognises that we have taken steps to address areas for improvement, we will continue to identify any learning and further improvements that can be made as part of this inspection process.

“Finally, we would like to reassure residents and businesses that this review will not impact the valuable services that you depend upon. We will continue to make sure that our day-to-day services remain at the standard you expect and deserve.”

May 2024

A review describing Warrington Borough Council’s portfolio of debt-funded investments as ‘very large and uniquely complex’ has made recommendations.

The Chartered Institute of Public Finance and Accountancy (CIPFA) has carried out a review of the Labour-run council’s debt and investment risk profile.

The report, which has now been published, says the council’s portfolio of debt-funded investments is ‘very large and uniquely complex’.

In the report, it says loans to housing associations is the ‘largest single area’ of council indebtedness – and these loans, should they be ‘fully drawn down’, would take total loans to housing associations to £920.7 million.

The report has made eight recommendations.

June 2024

Warrington Borough Council has seen its credit rating withdrawn amid its debts of around £1.85million.

Ratings agency Moody’s has pulled its credit rating of the council.

The local authority told bondholders that Moody’s withdrew its rating due to ‘the inability of the council to procure that its statements of accounts are audited by external auditors’.

A council spokesman said: “Warrington is one of only a small number of councils with a credit rating.

“Like other councils across the country, we have been impacted by the national issue of delays in the signing off of council accounts.

“Moody’s itself has been clear that the limited prospects towards a timely resolution of the audit backlog across the entire local authority sector mean that, in our case, it has insufficient information to maintain the ratings.

“It has therefore made the decision to withdraw our credit rating.”

June 2024

Warrington Borough Council’s leader says ‘we will be working as hard as we possibly can to make sure’ it can get its credit rating back.

During the full council meeting, in response to a question, council leader Cllr Hans Mundry said the council ‘was probably one of about half a dozen authorities who had the credit rating in the first place’.

He said he thinks it has been removed ‘simply because of the auditing problems’, adding there are ‘lots of council who are actually waiting for their auditing reports to be done and we’ve caught up in that process’.

Cllr Mundry also said ‘it’s not to do with council, it’s to do with the auditing process’ and said ‘it’s not just Warrington, lots of councils up and down the country have got the same sort of situation for their council’.

He added ‘we will be working as hard as we possibly can to make sure we can get the rating back’.