Lazy eyes listen
The Royal Borough of Windsor and Maidenhead in the United Kingdom is on the verge of bankruptcy, as rising interest rates have driven up the cost of servicing its £203 ($240 million) debt.
Berkshire County Council, which contains Windsor Castle in its catchment area, has overspent by more than seven million pounds (over $8.5 million) this year, councillors were told on Saturday.
In addition, it is planned to overspend by another £6.2 million in fiscal year 2024-25.
“Historic spending decisions on council tax and borrowing, weak financial management, and low financial resilience over the past decade – coupled with macroeconomic pressures such as inflation – have made the council’s position vulnerable,” Finance Councillor Lynne Jones said, according to the council’s website.
The most recent difficulties are attributed to rising demand for adult social care and high levels of inflation.
The cabinet’s primary goal will be to sort out the council’s finances until a stable financial situation is attained, according to Jones, who committed to do “everything we can” to avoid issuing a Section 114 notice, which would effectively declare the council bankrupt.
“However, the situation is complex and challenging, and it will take time to pull this around,” she said.
The Windsor and Maidenhead council is the latest in a string of local governments to declare bankruptcy in the last two years. In 2021, Slough Borough Council issued a Section 114 notice.