Government plans transfer of powers from Public Works Loans Board to Treasury

The Government has launched a consultation on the proposed transfer of powers from the Public Works Loan Board to the Treasury.

It claimed the move would create a more streamlined and up-to-date governance arrangement, secure greater accountability to ministers and increase efficiency of central government lending to local authorities.

Under the plan, operational responsibilities would be delegated to the Debt Management Office.

The consultation will run until 3 August. The consultation paper can be viewed here.

The Treasury said: “Currently, local authorities are responsible for identifying projects for which they require funding and determining how much borrowing they can afford, following the devolution of borrowing powers in 2004.

“The role of the PWLB as an independent decision-making body is therefore no longer needed and the changes will bring governance arrangements in line with the current policy and operational responsibilities. Under the proposals, local authorities will continue to be able to access loans in the same straight forward way as now and the policy on rates and repayment terms will remain the responsibility of the Treasury.”

Harriett Baldwin, Economic Secretary to the Treasury, said: “For over 200 years the Commissioners at the Public Works Loan Board have played a vital role in the ability of local government to fund capital expenditure and the construction of important local infrastructure.

“As local government continues to gain further decision-making powers, it’s right that we consider whether the governance, composition and status of the PWLB is fit for the twenty-first century.”