To ask the Secretary of State for Housing, Communities and Local Government, what the criteria for and restrictions on borrowing for local authorities are in relation to garden settlement proposals.

Under Local Government Act 2003, local authorities have the freedom to borrow and invest, without government consent, provided that their borrowing is affordable. As part of this ‘prudential’ framework, every local authority is required to set its own borrowing limit, which must be approved by full Council or the equivalent at least annually. The Government has backstop powers to set national borrowing limits at times of economic crisis, which would override the normal prudential freedoms. These powers have never been used.