DEBT levels at Worcestershire County Council have shot up by £20 million to a record high of £250 million.

In the last year the authority’s outstanding bills have increased by eight per cent because of bosses borrowing extra cash.

Opposition politicians have hit out at the new figures, urging bosses to “cut their cloth” and rein in any more moves to add to the burden.

New loans totalling £25 million were taken out during the 2011/12 municipal year, but £5 million of previous loans were repaid to leave £249.7 million overall debt on the balance sheet.

About £25 million will have to be paid back this year alone.

It comes amid a backdrop of major cuts, with the council looking to shed up to £90 million from the budget by 2014.

The cash went towards major capital projects such as the Hive, Worcester’s £60 million library and history centre, extra roads investment, and a scheme called Warming Worcestershire, a campaign to encourage people to better insulate their homes.

Some of it also went on extra improvements at Tudor Grange Academy, over and above standard Government funding.

Councillor Adrian Hardman, the leader, said: “Compared to most other councils we are doing OK, the council has assets worth more than £1 billion. We can’t stop doing things and investing, and need to try and get the economy moving where we can.”

He said the overall debt limit the authority could take on is £488 million.

But Coun Tom Wells, deputy leader of the Liberal Democrats, said: “Every household in Worcestershire has to cut its cloth, whether it’s by not going on that summer holiday or not investing in a new kitchen.

“Times really are tough, but you wouldn’t think it with this.

“The council has to cut its cloth and be more prudent. The problem, of course is that borrowing is the only game in town.”

The debt compares reasonably well to other county halls – Oxfordshire’s is more than £410 million, while Gloucestershire’s is £407 million and Devon’s stands at £686 million.

About £200 million of Worcestershire’s debt is owed to the Public Works Loans Board, a dedicated body which exists to help organisations such as councils, police forces and fire services.

The board has preferential interest rates compared to bank loans, and is managed by a team of commissioners linked to the Treasury.

The rates change on a regular basis, but are typically between one and four per cent for fixed loans.

During the last year the council took out four board loans, with interest rates on each varying from 2.5 to 3.8 per cent.

The report on the finances will be discussed by the Conservative cabinet on Thursday.