Westmorland and Furness Council among UK councils that owe a combined debt of £122.2bn to lenders

A report released today has revealed UK councils owe a combined debt from loans of £122.2bn to lenders, Among them is Westmorland and Furness Councils with a total borrowing debt that stood at  £185.3m at the end of 2024/25, That equates to £811.96 for every person living in the Westmorland and Furness district.

By comparison, Analysis of data from the Ministry of Housing, Communities and Local Government (MHCLG) shows UK councils owe a combined £122.2bn to lenders, equivalent to £1,791 per resident, as of April 2025.

Councils can borrow funds to invest in projects such as schools, leisure centres and theatres - they can also borrow to invest in property that will bring in an income over and above repayments on the debt. 

Established on the 1st of April 2023 Westmorland and Furness inherited its debts from the Former Cumbria County Council, South Lakeland District Council and Barrow Borough Council and Eden District Council.

The recent rise across the UK is being partly driven by a near tripling of short-term lending from central government, which in some cases is being used to paper over holes in some council revenue budgets rather than pay for investments and town centre improvements.

Experts including Jonathan Carr-West of the Local Government Information Unit (LGIU) said the spiralling levels of debt at local authorities was “extremely worrying”.

He said: “That is not a sustainable system. As one local government finance officer said to me, it's essentially payday loans for local governments. 

“I don't think the government would say that’s it’s long-term ambition. They would say that is what we have had to do to paper over the cracks while we introduce a new funding system for local government.”

A spokesperson for Westmorland and Furness Council said: “It is one of our core values to be a responsible council, this includes financially. We are focused on delivering value for money and making the best and most efficient use of resources.

“While the council had external borrowing of £185.3m at the end of June 2025, this relates to borrowing that was taken out prior to the inception of Westmorland and Furness Council. The portfolio of loans is the aggregation of the external borrowing from Barrow Borough Council, Eden District Council, South Lakeland District Council, and our proportion of Cumbria County Council upon the disaggregation under Local Government Reorganisation. This borrowing is used to fund investments in assets.

“Westmorland and Furness Council has not drawn down any new loans since its inception on 1 April 2023 and does not expect to draw down any further external borrowing during this financial year.

“If that remains the case, after natural loan maturities, the external borrowing at 31 March 2026 is forecast to reduce to £176.3m.”