Cardiff Council's debt has risen to nearly £1.2bn, leaving the city needing to pay around £60m in interest and debt repayments every year. The huge sums were revealed in a written answer to a backbench councillor.
The debt total of £1.178bn is equivalent to more than £3,254 for each of the 362,000 residents of the Welsh capital listed on the Census in 2021.
Annual interest bill of £50m
This year, the city is budgeting more than £60m to service those debts, which includes an interest bill of around £50m. With council tax being paid by households rather than individuals, it means that each of Cardiff's 158,000 households is effectively paying £381 in interest.
Cardiff's debt has been built up over many years through its spending on capital projects like the building of new social housing and developing infrastructure like the new arena in Cardiff Bay.
Details revealed in council questions
Written questions put to the local authority by Cllr Neil McEvoy at a recent full council meeting revealed the extent of the Welsh capital's debt.
According to the council's response, as of September 7 this year its external borrowing stands at £1.178bn. The questions also showed that for the last financial year, the council made a debt payment of £60.1m and that the forecast for this year's debt repayment provision is £60.4m.
According to the same document, the estimate for the external interest paid on loans taken by the council for 2026/27 is £50m. For 2027/28, an estimate has been made of £59m but, according to the council, this estimate is “extremely difficult to forecast”.
New borrowing and leader's defence
Separate papers prepared for councillors, called the Treasury Management Annual Report for 2025/6, showed the council took on £234m of new borrowing in 2025/6 to take the total as of March 31 this year to £1.147bn. The council paid an interest rate of around 4% on those borrowings.
These figures given in answer to Neil McEvoy suggest the city's debt has risen by a further £30m since March.
Earlier this year, the Local Democracy Reporting Service (LDRS) spoke with the leader of Cardiff Council, Cllr Chris Weaver, about the city's level of debt. He said: “I think when you talk about the borrowing that the council does, it's really important to understand how a council borrows.
“We do not borrow to deliver our day-to-day services, unlike the UK Government, which runs up a national debt because it's running a deficit. We don't run deficits – we have a balanced budget every year.
“The borrowing we do is to invest in our capital programme.”
The council leader, who previously served as the cabinet member for finance at the local authority, added: “If you don't invest in a city you can end up costing yourself more.”
Examples he gave of investment in the city were the council's house building programme and regeneration projects.
Of all the Welsh councils, Cardiff Council has the most debt. However, in terms of population it is Wales' largest local authority.
