CIPFA Response: NAO report on council investment in commercial property


Rob Whiteman CBE, CIPFA CEO, said:

"CIPFA welcomes today’s report from the National Audit Office and the insight it brings to council activity around commercial borrowing.

"Councils should, and do, have the flexibility to take their own investment decisions; provided those decisions are taken in line with service objectives and that they are prudent, sustainable and meet their duty to provide value for money to taxpayers.

"While the avoidance of all risk is neither appropriate nor possible, councils should have regard to the CIPFA Prudential Code to ensure they do not take on an inappropriate amount of risk when exercising their powers.

"There remains a question for the sector about what happens in the few cases where councils do not have regard to the Code, which the government will likely address at some point."


For further information please contact the CIPFA press office on T: 020 7543 5647 or E:

Notes to Editor:

  • CIPFA looks forward to working with MHCLG to ensure that the Prudential Framework, its oversight and intervention arrangements and underpinning data remain fit for purpose in the context of the increase local authority commercial activity.
  • CIPFA is pleased that the NAO recognises the important role that CIPFA's Prudential and Treasury Management Codes have played in a successful regulatory framework that has enabled local authorities to determine their own programmes for capital investment and demonstrate that they are prudent, affordable and sustainable.
  • The NAO report recognises that CIPFA responded to the changing environment facing councils; the rapid growth in spending on commercial borrowing and in levels of borrowing by making revisions to its guidance in 2018 and issued further updated guidance on Prudential Property Investment in November 2019.
  • View the NAO report here.


CIPFA, the Chartered Institute of Public Finance and Accountancy, is the professional body for people in public finance. CIPFA shows the way in public finance globally, standing up for sound public financial management and good governance around the world as the leading commentator on managing and accounting for public money.

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