Question to the Ministry of Housing, Communities and Local Government:

To ask the Secretary of State for Housing, Communities and Local Government, pursuant to the answer of 5 February 2025 to Question 26838 on Local Government: Debts, whether councils which are (a) in two-tier areas and (b) have high levels of unsustainable debt will have those debts ringfenced during local government restructuring to the council area which originally generated the debt.

It is the responsibility of councils to manage their budgets, and it is standard for councils to borrow and to hold debt, which they will do in the normal course of business. In general, as with previous restructures including those very recently, there is no proposal for council debt to be addressed centrally or written off as part of reorganisation. For areas where there are exceptional circumstances where there has been failure linked to capital practices, proposals should reflect the extent to which the implications of this can be managed locally, including as part of efficiencies possible through reorganisation. We will work in partnership with local areas to work through the implications of this.