Borrowing Applications

 Applicants must obtain a borrowing approval from the Ministry of Housing, Communities and Local Government (MHCLG) - formerly DCLG, for which they should approach their County Association of Local Councils

What is and what is not borrowing? 

'With certain exceptions the Secretary of State's approval is required for the purpose for which money is borrowed, and he may impose conditions in accordance with which the borrowing shall be carried out (Local Government Act 2003, Sch 1, para 2). If the purposes can be attained without borrowing, the Secretary of State's approval is not needed, and it is not necessary to observe his conditions. Some transactions resemble borrowing in their practical effect but are not borrowing in law; and this fact can be important, especially in times of capital stringency.' Paul Clayden, Arnold-Baker on Local Council Administration (11th Edition) 2018:154

Paul Clayden, Arnold-Baker on Local Council Administration (11th Edition) 2018 Chapter 15 CAPITAL FINANCE provides full details on local Council borrowing.

Procedure and Departmental Approval

 'Until April 2002, the Treasury and the relevant Secretary of State annually agreed on the global amount which English parish councils might borrow. Since then, the annual ceiling has been abolished, but the maximum amount an individual council may borrow in a single financial year is normally £500,000. The tiers of scrutiny have been reduced from three to two and a quick procedural timetable has been introduced.

Not withstanding these relaxations, departmental consent must still be obtained for borrowing. In England, applications for approval are made through County Associations of Local Councils to the National Association. There is a standard form of application and applications will be approved so long as current criteria for approval are met.' Paul Clayden, Arnold-Baker on Local Council Administration (11th Edition) 2018:156

Sources of Borrowed Capital

There are four types of sources of loan capital; Private lenders & loan trusts, Public foundations, other Councils and the Public Works Loan Board. 

See Paul Clayden, Arnold-Baker on Local Council Administration (11th Edition) 2018:156-157 for more information on this.


Public Works Loan Board (PWLB) 

The Public Works Loan Board lends to town, parish councils and community councils.

For more information and interest charges please visit the PWLB website 


If your Council would like to apply for Borrowing Approval you are required to complete an application form which you can download using the link below. Once completed please return to Penny Bryant, CEO via email for validation