The Local Council Report / Capital & debt / Internal borrowing gap · markdown view

Internal borrowing gap

ratio · constructed · council-year

This shows how much of the council's total debt it has covered by dipping into its own spare cash instead of taking out loans. It matters because using your own cash is cheaper than paying interest, but that cash is then not available for emergencies — and eventually real loans may be needed to replace it. A high number means the council is running down its own reserves of cash to avoid borrowing; a low number means its debt is mostly backed by actual loans.

councils
309
median
0.32
q1
0.21
q3
0.54
min
-0.17
max
1.56

Distribution

-0.051

Worst 10

CouncilClassValueIn its class
Gloucesterdistrict-0.171st worst of 158
Brentwooddistrict-0.162nd worst of 158
West Devondistrict-0.123rd worst of 158
Hyndburndistrict-0.054th worst of 158
Medway Townsunitary-0.041st worst of 63
East Hertfordshiredistrict-0.045th worst of 158
Test Valleydistrict-0.036th worst of 158
Derbyshire Dalesdistrict-0.017th worst of 158
Worthingdistrict08th worst of 158
Staffordshire Moorlandsdistrict0.019th worst of 158

Best 10

CouncilClassValueIn its class
North Hertfordshiredistrict1.561st best of 158
Broadlanddistrict12nd best of 158
Bromleylondon11st best of 33
City of Londonlondon11st best of 33
Wychavondistrict12nd best of 158
Bromsgrovedistrict12nd best of 158
Mid Sussexdistrict12nd best of 158
Horshamdistrict12nd best of 158
Chichesterdistrict12nd best of 158
Stratford-on-Avondistrict12nd best of 158

Definition

nameinternal_borrowing_gap
dataset02-capital-outturn-debt
kindconstructed
typenumeric
unitratio
graincouncil-year
rolefeature
source(cfr_end − gross_borrowing_end) / cfr_end — PRU1_prucfrend_amt and PRU2T1_prubrwgrs_end (both this dataset)
period2018-19 to 2024-25
missingnessunknown
score_noteUnique refinancing-risk angle, but internal borrowing is hard to explain simply.
calculated../calculated/internal-borrowing-gap.csv
calculated_rows2305
calculated_periods2018-19 to 2024-25
calculated_date2026-08-13
peer_groupdistricts (n=194), unitaries (n=65), metropolitan boroughs (n=36), London boroughs (n=33), counties (n=27) — scored within each class against its median/IQR

The share of the council's borrowing need met internally from its own cash balances rather than external loans. Internal borrowing is cheap in the short run, but a large gap that must eventually be externalized at current interest rates is a refinancing risk. Read together with investments_end, which shows the balances being drawn on.