Councillors have been warned that Swindon Borough Council needs to borrow nearly £100m to cover its spending.

And that would bring its debts to close to half a billion pounds.

This extra borrowing would come on top of another £22m borrowed in the last financial year.

Senior councillors will be quizzed by backbench members at meetings this week, but they say the headline borrowing need does not always translate into actual loans being taken out.

A report to the ruling Conservative cabinet on the council’s holdings and borrowing shows the authority’s borrowing increased in 2019-20 from £375.8 by £22.6m to nearly £398m. And the report warns that more is needed – £95.7m. That would take the council’s borrowing to an enormous £494m.

It says: “This table shows an under-borrowed position of £95.7m – ie there is a requirement for a further £95.7m of long-term borrowing to finance capital expenditure already incurred. This relates fully to the general fund as the HRA is fully funded.”

The report explains his headline figure is actually higher than the amount the council would actually need to borrow – because it can move money about in what it calls ‘internal borrowing’.

Last year the under-borrowing was actually higher at £102.9m – but the authority only actually took out extra loans of £20m.

The total is made up of a debt of £390m on the council’s general fund and £104m on its housing revenue account. It paid off £5m of the HRA debt which was £109 at the start of the year.

It means the council’s total borrowing had a net increase of £22m, from £375.8m to £398.4m

Bob Wright, the Labour chairman of the Scrutiny Committee will be raising the matter.

He said: “The report says this borrowing is needed to cover expenditure already incurred. I asked for details of where the money had been spent at last week’s cabinet meeting and they didn’t have those details. I expect those questions to be answered fully at tomorrow’s scrutiny meeting.”

Independent councillor Oliver Donachie, who was until May a member of the cabinet and Conservative group, is concerned. He has lodged formal questions for the council’s finance officers at Thursday’s full council meeting.

He wants to know whether the council will be taking out such a huge loan, and if it does what will be the impact on services of servicing the increased debt.

Coun Donachie has also asked for details of where the spending occurred causing the need for such borrowing.

He said: “When you borrow money, that has an impact because you have to pay that money back.

“I will be interested in the answers to my questions.”

The council’s Conservtative cabinet member for finance Russell Holland said: “Every single year Swindon Borough Council has a balanced budget for all of our day to day spending. Most of this money is spent on helping vulnerable adults and children. All of this is fully funded there is no borrowing for revenue spending.

“For capital programmes, such as investment in roads, buildings and other infrastructure this is funded from a combination of grant funding and also borrowing. The capital programme is regularly reviewed and particularly in light of the impact of Covid-19 it may not be possible to proceed with all of our investments. It is also important to keep in mind that the council has had a commercial investment programme which has been used to purchase assets which have made money for the council.

“This is presented to full council every year and at council meetings throughout the year. Every year Councillor Donachie has been a Councillor he has voted in favour and spoken in support of the Conservative budgets and I am grateful for his support. Labour propose either no or minimal amendments to the budgets.

“The cabinet is working very hard to invest in Swindon and the future of the town. I’m proud of Swindon and that we have always had a balanced budget, helped those most in need and continued to invest in our town.”