Shocking rising council debt revealed
West Northants Council has £94 million more debt this year than last, as figures across the country are revealed.
Last updated 26th Aug 2025
Councils in the UK added £7.8bn to their growing debt pile in the space of a year - the Shared Data Unit has found.
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.
That is up seven per cent from a total of £114.5bn, the equivalent of £1,677 per resident, a year ago.
In Northamptonshire, West Northants Council had debt at the end of the 2023-24 financial year of £585,039,000 and 2024-25 it rose to £679,346,000.
That's £94 million pounds more debt this year than last and amounts to more than a 16% increase which amounts to more than £217 per person.
For North Northants Council debt at the end of the 2023-24 financial year was £443,368,000 and 2024-25 it rose slightly to £443,242,000.
The difference being £1,204.83, that amounts to a 34p per person.
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.
But the recent rise 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.”
In recent years, various commentators have warned that the debts held by councils - which must balance their budgets every year - are unsustainable.
In 2020, Dame Meg said the Government was “blind to the extreme risks” of council borrowing levels.
Since then, six more councils have had to issue section 114 notices declaring themselves effectively bankrupt: Croydon, Slough, Thurrock, Birmingham, Woking and Nottingham.
In the case of Croydon, Slough, Thurrock, Woking and Nottingham - those effective bankruptcies could be directly linked to failed investments and spiralling debts.
We've approached North Northamptonshire councils for comment.
West Northamptonshire Council said in a statement that The Council’s Treasury Management Strategy makes sure our borrowing is both affordable and sustainable.
They added:
"Like many councils, West Northamptonshire faces significant financial challenges due to rising demand for services and years of underfunding from central government. Borrowing enables us to continue investing in the local infrastructure, schools, housing and community facilities that residents need, while ensuring that the cost is spread fairly across the generations who will benefit."
Examples of key additional capital investment last financial year included:
• Investment in our housing stock ensuring it is safe, comfortable, and up to modern standards
• Investment in highways infrastructure works and maintenance.
• Investment into our children’s services improvement journey as well as a new SEND school
• New mortuary facility providing services to support both the WNC coroner’s service and other organisations across our region
• Asset acquisitions to support local town centre regeneration, or organisational efficiency.