IMPENDING changes in local government could halt a council's controversial move to new headquarters.

Borrowing restrictions on existing district councils in the run-up to their anticipated abolition could mean a shortfall in cash for the scheme.

Councillor Stuart Parsons, who opposes Richmondshire District Council's intended move to £5m offices in Colburn, North Yorkshire, urged the authority to re-examine the matter.

His comments followed a public presentation by John Marsden, North Yorkshire County Council chief executive, about plans for a county-wide single-tier local authority. The bid has cleared the first hurdle and a Government announcement is expected in July.

Mr Marsden told a meeting of Richmond Town Council, which was attended by about 25 members of the public, that unitary local government was highly likely for the county but it would inherit the assets and debt of the abolished district councils and county council.

"The new council would inherit any debt, but would also inherit the existing budget to service that debt," he said. "My advice would be that they (the existing councils) can't make a decision to borrow money to build, say, a new office block if there is not the revenue to support that borrowing." The Secretary of State would give interim powers to senior county council officers to oversee the change.

An existing council would not be allowed to enter into contracts which went beyond the life of that authority without the agreement of those officers, said Mr Marsden.

Richmondshire District Council had hoped to raise money for its headquarters by selling assets, but it has been unable to sell Yorke Square car park, in Richmond, and land in Gatherley Road, in Brompton on Swale, because of legal constraints.

Coun Parsons said: "The council only planned to borrow £2.5m or so over 50 years, but they will now have a shortfall and all they could have done is borrow more money.

"The unitary authority would take a new look at the whole issue.

"We would expect a majority of existing district council jobs to be retained by the new authority in Richmond, where work would be done on office accommodation."