‘Divorce settlement’ between councils still costs Telford taxpayers £1million every year
Taxpayers in Telford are continuing to stump up more than £1 million a year to pay Shropshire Council for their separation.
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Telford & Wrekin Council was created a quarter of a century ago in 1998 when it took the full powers of a unitary authority and Shropshire Council did the same for the rest of the county.
At the same time as it achieved new powers, Telford also had to take responsibility for a proportion of the debts held by the former Shropshire County Council.
Budget papers produced for the annual round of council tax-setting meetings revealed that in the last financial year Telford & Wrekin Council paid more than £1 million to Shropshire Council for this purpose.
Documents produced for recent meetings revealed that “the council made an annual contribution towards Shropshire Council costs on pre-disaggregation debt.
“The contribution in 2023/24 was £1.143m and interest paid averaged 4.1 per cent.”
A spokesperson for Telford & Wrekin Council confirmed that the payments would continue during the next financial year and for another 35 years after that.
A Telford Council spokesperson said: “The payment to Shropshire Council is in relation to historic Shropshire County Council debt and is scheduled to continue to 2060/61.”
Budget papers also reveal that overall, a little under 10 per cent of the annual revenue budget goes on debt repayments. These can be affected if interest rates rise or fall.
The council has confirmed that in 2025-26, all debt repayments are expected to be around 9.9 per cent of the council’s £180 million revenue budget.
Council budget papers point out that the council generates an income from schemes such as its arms-length housing company Nuplace and the Growth Fund.