Issue - meetings

Motion by Councillor Watt – Public Works Loan Board Interest

“Committee –

Notes that the Bank of England has purchased £745 billion of government bonds since 2009, effectively giving the UK government interest free finance and that the Bank of England has recently issued Treasury Bonds with negative yields (negative rates of interest);

Further notes that the UK Government could pass on to Councils, some of the benefits of these zero interest rates, by waiving the interest on existing loans from the PWLB (Public Works Loan Board) which Councils have used for essential infrastructure investment. For Edinburgh, this would represent a saving of £32 million each year to the general fund, which could be used to protect services and jobs during these unprecedented times; additionally, there could be a £15 million per year saving to the HRA account, allowing increased investment in Council housing stock which would create jobs and other benefits for the economy and for Edinburgh’s citizens.

Committee therefore asks that:

1.      The Council Leader writes to COSLA, emphasising the potential savings for Edinburgh Council from the interest on PWLB loans being waived for at least two years and asks COSLA to pursue a two year waiver with the UK Government;

2.      The Council leader writes to the UK Chancellor of the Exchequer to raise this proposal; and that

3.      The Chief Financial Officer writes to the Permanent Secretary of HM Treasury, requesting that interest on existing PWLB loans be waived for at least two years.