01/07/2026
TWO YEARS LATER - OPPOSITION COUNCILLORS WAKE UP TO LABOUR'S FINANCES
I investigated and reported this back in November 2024 on the Southampton Independents website. Labour councillors "audit" themselves. Or rather, don't "audit" themselves. I raised it with the Monitoring Officer. No action taken. He said it was fine that the same Labour Party that had ruined the Council's finances could "audit" itself on the Audit Committee. Wrong.
My investigation is at the link below in the comments.
Southampton City Council’s net debt is forecast to rise by 57 per cent this year, according to a new finance report.
The authority’s net debt stood at £384.74 million at the end of March, but is projected to reach £605.56 million by the end of the 2026/27 financial year.
The figure rose by just under £40 million, or 13 per cent, from from March 31, 2025, to March 31, 2026.
Reform UK councillor Ross Mould questioned the forecast increase at an audit committee meeting on Monday, June 29.
Cllr Mould said: “That’s a big difference.
“I don’t expect you to go into the nitty gritty of it but why the big change.”
A treasury management report showed that around £210 million of the increase forecast for this year is expected to come from long-term borrowing.
Director of finance Hannah Doney told councillors the net debt rise was driven by two related but distinct factors.
Ms Doney said: “One is the capital financing requirement which is our underlying need to borrow and one is the actual amount of borrowing that we have.
“What’s happening between the end of 2025/26 and the end of 2026/27 is we have within our capital programme an increase in the underlying need to borrow and at the same time we are forecasting we will need to externalise some debt that’s coming in that we are not having to take at the moment because we’re using internal cash balances.
“Those two things are forecast to compound during 2026/27, which means we have to take more external borrowing.
“The amount of external borrowing is increasing by more than the capital financing requirement in the current forecasts.”
The capital financing requirement (CFR) represents the council’s underlying need to borrow, reflecting historic capital spending that has not yet been paid off from revenue or other resources.
The council remained well within the limits for its prudential indicators in 2025/26.
The authority’s capital strategy for 2026/27, approved in February, includes £216.82 million of planned expenditure across the general fund and housing revenue account.
At this year’s budget setting, Labour leaders said the capital programme for the coming years included major investment in fixing school building defects, fleet replacement and an increased highways budget for repairs and resurfacing.
✍Original copy by Jason Lewis, Local Democracy Reporter
