The new draft Local Authority (Capital Finance and Accounting) (Scotland) Regulations 2016 cover changes to the statutory arrangements for local authority borrowing, lending and the statutory loans fund. They were the subject of a short consultation at the end of 2015. The Regulations and draft Statutory Guidance on Loans Fund Accounting are set to come into effect, with any changes following the consultation, from 1 April 2016.
Consultation documents state that the approach taken in The Local Government (Scotland) Act 1975, which lists the sources of local authority borrowing – banks, Public Works Loan Board, stock, bonds, bills etc – is to be replaced with a general power to borrow from any source. “In place of prescription, the regulations require a local authority, when exercising its power to borrow, to have regard to recognised codes.” These include the Chartered Institute of Public Finance and Accountancy (CIPFA) Treasury Management and Prudential Codes.