SIC has lowest borrowing debt of all Scottish local authorities, figures suggest

NEW figures suggest Shetland Islands Council has the smallest debt of all local authorities in Scotland.

Whereas borrowing increased on average across the UK’s councils from the end of 2023/24 to the same period in 2024/25, the SIC’s figure stayed the same at £49 million.

This gives a total debt per person in Shetland of £2,130, which is higher than some other local authorities.

The figures come from the BBC’s Shared Data Unit, which has published analysis featuring data from every local authority in the UK.

The SIC appears to have the lowest figure of all councils in Scotland, with Orkney – at £50 million – close by.

The debt covers borrowing used to help pay for a range of capital projects, from the new Anderson High School to the Toft pier.

Separately the council has reserves which is put into investments to generate income, with the value of these sitting at more than £370 million at the end of March.

SIC finance manager Paul Fraser said the ability to borrow helps the council to afford large one-off costs.

“The council may decide to borrow rather than using reserves, where the cost of borrowing is believed to be lower than the value of the return from reserves invested,” he explained.

“Care is taken to review each borrowing decision, as borrowing has a cost and has to be affordable.”

The SIC’s treasury management strategy statement for 2025/26 said all external borrowing to date has been from the Public Works Loan Board, which is overseen by HM Treasury.

This is on a fixed rate maturity basis, where the money borrowed is repaid back at the end of the loan period.

As of 31 December 2024 the annual interest on these loans amounted to £1.67 million.

The statement said that over the next five years a total of £14 million of loan value will be repaid.