UK Parliament: Overseas Territories, Debt & More
“The UK Government is not aware of any examples of an Overseas Territory defaulting on its debt to international creditors,” Minister of State Amanda Milling said.
During the British Parliament’s session on March 30th, Conservative MP Andrew Rosindell asked the Secretary of State for Foreign, Commonwealth and Development Affairs “what the liabilities or obligations are of an Overseas Territory in the event that it defaults on its debt to international creditors; in what circumstances her Department would be obliged by statute or constitutional provisions to offer financial assistance to, or assume those liabilities; on how many occasions this has happened; and what mechanisms were used.”
In response, Minister of State Amanda Milling said, “The UK Government’s fundamental responsibility is to ensure the security and good governance of the Territories. The UK maintains mechanisms to effectively manage these responsibilities and to ensure they exercise sound public financial management.
“The Overseas Territories Governments are responsible for their own fiscal policy. Most territories rely on local revenue and borrowing, and are responsible for their own liabilities. The UK Government does not have a trustee or guarantor role when the Territories borrow.
“In some cases, the UK Government has chosen to support Overseas Territories financially, such as regular financial aid to certain territories and ad hoc support in times of crisis.
“For example, the UK agreed a loan guarantee for a lending facility in 2020 with the Government of Gibraltar to support their response to Covid-19. The UK Government is not aware of any examples of an Overseas Territory defaulting on its debt to international creditors.”
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