The Public Works Loan Board (PWLB) interest rate rise has forced more than half of councils to alter their 2020/21 financial plans, according to a survey.
According to a poll of senior council decision makers by the Local Government Information Unit, 59% have changed tack following the Treasury’s move.
The survey said that 22% would look to borrow from an alternative source, while others are still intending to use PWLB but are scaling back their plans, the survey found.
Despite this, 87% of councils still hope to borrow from the PWLB this year, with 23% planning to use the Municipal Bonds Agency.
The survey found that 77% of respondents lack confidence in 100% business rate retention as a mechanism to fund local government
Nearly all councils (97%) plan to increase council tax in 2020/21, with 93% saying they will raise it by more than 1.5%.
In addition, nearly all councils (97%) plan to increase fees and charges in 2020/21, with some being forced to raise them ‘by the maximum possible amount’ (14%).
