East Hampshire District Council has stated it is not in financial trouble following a report by the Moody's investors service which said it was the 13th most indebted council in England on a borrowing-to-income basis.

The report, published in the Guardian, said East Hampshire had total borrowings of £120 million, which was 9.5 times the size of its annual income – but the council claimed this was sound borrowing.

In a statement, it said: "East Hampshire District Council is in a strong financial position.

"Our borrowing reflects our investment in a property portfolio which, far from being a drain on resources, continues to generate income for the council, keeping council tax low and providing money to fund front line services.

"By borrowing through the Public Works Loan Board we have fixed low rates of interest on the loans, so they are not affected by the recent rises in interest rates.

"As a district council, East Hampshire is also unaffected by the rapidly rising cost of social care which has had a serious impact on those authorities responsible for delivering those services.

"The decline in government funding has put pressure on council finances across the country but prudent financial management has allowed us to deliver balanced budgets and invest in public services."

Hampshire County Council, which asked residents where to make budget cuts, said: "Hampshire is in a better financial position than most other county councils, and while our finances are stable until 2025-26, we do need central government to fundamentally change the way local government services are funded, or reduce what councils are legally required to deliver.

"In the meantime, though, we can't just sit and wait for that to happen. We have to plan on the basis that we'll have to close the budget gap ourselves, which is why we're reviewing these savings proposals now."