Brexit fears and demand for property investment prompt council to request £100m cash injection

May 15, 2018

The uncertainty of Brexit and a need to invest more in properties has forced council officers at one Surrey borough to ask for a loan of £100m to be brought forward.

Officers at Runnymede Borough Council have a loan arrangement of borrowing £200m split evenly over 2018/19 and 2019/20 for “strategic property acquisitions”.

At a special council meeting on Thursday papers show they are asking to have the £100m put aside for the approved Capital Programme of 2019/20 brought forward to the current financial year to secure “required income generation targets earlier”.

Councillors have been asked to sign-off the request which will mean the council exceeds its authorised borrowing limit in a year from £637,943,000 to £737,943,000.

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It states: “With interest rates set to rise during the year, the uncertainty surrounding the eventual Brexit deal and its effects on the markets and the need to bolster the council’s income position to allow for the regeneration of parts of Egham, officers would like to bring forward the £100million set aside in 2019/20 to the current financial year to secure the required income generation targets earlier.”

The changes will mean it has £200m to spend in 2018/19.

To do this, councillors must agree to extend their borrowing limits for a year.

The powers for a local authority to borrow and invest are governed by the Local Government Act 2003 and each council must set an affordable borrowing limit.

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