The full extent of the financial woes came to light in the council’s treasury management strategy this month.
Since 2018, the Ashfield Independents-led council has invested in a large property portfolio, which, the MP suggests, has backfired by racking up huge debt and incurring interest charges.
Purchases have included industrial units in Falkirk, Wishaw, Grangemouth and Atherstone, along with a hotel in Stratford-upon-Avon.
Lee Anderson, Ashfield and Eastwood MP, is worried about the impact the debt will have on residents for years to come.
He said: “This is an appalling waste of council taxpayers’ money. Make no mistake – there needs to be a plan in place and fast. The council needs to get a grip of this debt.
“I am calling on the council leader and officers to explain how this has happened and what plan is in place to resolve this disastrous mess.”
Ashfield has secured one of the largest Towns and High Street funds in the country to improve the district. Mr Anderson is now seeking reassurance the £70m funding will not to be used to pay off the council’s debt.
He alleges the council is paying the debt back from the revenue account, funded by council tax, at a rate of more than 20 per cent this financial year and 33 per cent for the following two years.
In those years, he says, only 66p of every £1 paid to the authority goes on services and the remaining goes to pay off debt.
However Coun David Martin, council cabinet member for finance and member for Underwood, hit out at the MP for criticising ‘something he clearly does not understand’.
He said: “The council does have a large portfolio of investment property, but the income generated from these assets significantly exceeds the debt and interest costs.
“Indeed the significant profits generated have assisted the council retain some services other councils have had to cut and, in recent years, have assisted us to freeze council tax, quite the opposite of what the MP alleges. Our residents should be assured the council’s finances are in very good order.”