Hartlepool Borough Council’s £10 Million Debt Interest Bill: How It Compares to the Rest of the UK

Hartlepool Borough Councils borrowing liabilities revealed to be costing the local tax payer just over £10m pounds a year just in servicing the Interest alone !

26th August 2025

Hartlepool Borough Council’s recently published Draft Financial Report for 2024/25 has finally unveiled the true scale of the town’s borrowing and the cost of servicing its debts, with Hartlepool Borough Council amassing a loans liability that now outstrips its entire years operational budget...

The figures, revealed in the councils draft financial report shows Hartlepool Borough Council has now taken out a total of £159.4 million pounds in loans, most of which is said to be tied up in long-term borrowing (£152.2m), with a smaller proportion in short-term borrowing (£7.3m).

The cost of servicing this debt in the last financial year alone was reported to be £10.45 million pounds, with that money going directly to lenders rather than into frontline services, community projects, or investment in the town.

A local Council "clearly Living far beyond its means", but its not the worst !

Hartlepool Borough Councils debt liabilities just in loans is a cause for concern given it being one of the countries smallest unitary authorities.

The total amount of loans taken out by Teesside's most troubled institution means Hartlepool Borough Council now has a loans liability larger that its entire years annual budget, with the local council which in 2023 was braded an authority with no public confidence owing the equivalent of around 117% of its yearly annual income.

Hartlepool Borough Council's interest bill is undeniably large, but its claimed that in the wider picture it actually sits slightly below the national average, where, across the country, the typical annual spend local councils are shelling out on interest payments alone is reported to be around £12.8 million pounds per year.

However, the real concern comes when looking at how the debt eats into council finances. Nationally, many local councils now spend up to 20% of all council tax income just in servicing their loans. In Scotland, its claimed some councils such as Glasgow and Edinburgh are spending an eye-watering 50–55% of their council tax income purely on interest.

By contrast, Hartlepool’s burden, whilst heavy, is not at that extreme level. But the town is far from immune to the pressures. The £10.45m interest bill still represents a significant drain on local resources—money that residents ultimately have to make up through council tax increases, or reduced services.

A silent crisis !

Local council borrowing across the UK has now soared to nearly £100 billion. The national annual bill for servicing this debt is estimated to be around £3.2 billion.

Much of this debt stems from commercial property ventures, regeneration schemes, or major capital projects, many of which were taken out in an era of much lower interest rates. As borrowing costs rise, councils face a double squeeze: higher repayments alongside growing demand for vital services.

Whilst Hartlepool’s debt is not yet among some of the most extreme in the country, it does raise serious questions about long-term sustainability. With £159m owed and £10m a year already being lost to lenders, the council has less flexibility to cope with future pressures.

If interest rates remain high—or if the council takes on further borrowing to finance regeneration schemes—residents may see even more of their council tax being swallowed up by debt costs rather than frontline services.

Hartlepool Borough Council’s interest payments may be below the UK average, but the numbers are still stark. At a time when services are being stretched and residents face rising costs, its little comfort to know that over £10 million pounds of public money a year is leaving the town just to pay off the interest on council loans.

Hartlepool Borough Council’s loans interest bill has risen by over 8% in just one year, costing almost £800,000 more to local tax payers than the previous year, highlighting the growing pressure of debt servicing on the council’s finances & the impact on the local tax payer.