Council tax increases despite government incentives

Council tax bill The government has asked councils to freeze local taxes for the third year running

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More than 40% of councils in England are planning to increase council tax this year, according to a survey.

This is despite local authorities being offered money by the government to freeze bills.

However the Chartered Institute of Public Finance and Accountancy (Cipfa) survey suggested that the overall average increase would be less than 1%.

The Local Government Association said it had been a difficult decision for councils in the face of cuts.

Local authorities in England are being given extra money by central government for the third year running if they freeze bills.

But this time a larger number of councils are increasing council tax (41%) - last year 85% took up the government's offer.

Tight budgets

Cipfa said 102 out of 250 authorities surveyed planned to put up council tax in April, typically by about 1% percent.

Any increase over 2% percent is supposed to trigger a local referendum - but some councils are finding ways to increase it by more than that without a poll.

These councils have taken legal advice and plan to use a loophole that allows them to increase waste and transport costs by more than the 2% cap. Others have opted to put up taxes by 1.99%.

Start Quote

All councils are having to strike an increasingly difficult balance between protecting hard-pressed taxpayers and maintaining local services”

End Quote Ian Carruthers Director of policy, Chartered Institute of Public Finance and Accountancy

A small number of authorities are managing to reduce council tax by finding more efficient ways to deliver services.

Regional variations included an average 1.2% rise across Yorkshire and Humber, and a 0.1% increase in London.

Cipfa director of policy Ian Carruthers said tight budgets meant councils had to make difficult choices between tax rises and cuts in services.

"Councillors must take council tax decisions based on local priorities," he said.

"As the pressures from this period of unprecedented austerity intensify, all councils are having to strike an increasingly difficult balance between protecting hard-pressed taxpayers and maintaining local services.

"The imminent changes to local authority funding systems are bringing added uncertainty to councils' financial management and making it more difficult than ever for councillors to take the medium and longer term decisions required."

Communities Secretary Eric Pickles said the small average increase across England meant it was "a tax cut in real terms".

'Fully accountable'

A Local Government Association spokesman said: "This has been a tricky decision for councils.

"Collectively local authorities are facing a 33% cut in funding from government at the same time as the cost of providing services like adult social care is climbing through the roof.

"The council tax grant from government is very small when set against those pressures and it lasts just two years with no certainty beyond that.

"Ultimately councils have to take a long-term view. Some have clearly decided that increasing council tax is one way of meeting current costs and alleviating pressure in the longer term.

"Councils are fully accountable to their electorates for these decisions."

The Conservative leader of one council putting up tax - Canterbury City Council's John Gilbey - told BBC Radio 4's Today the government subsidy was for a limited amount of time.

This meant, he said, that when the extra money to freeze council tax ended, "you're still losing that permanent element of a tax base".

He added: "Don't forget we've got no compensation now, ever, for inflation. Our services, cost of services are going up, we're determined to keep a high standard of those services as long as possible, and also, in the end, to keep services going."

Asked about being a "democracy dodger" by increasing council tax by just below the 2% trigger for a referendum, he said that holding such a vote would cost up to £200,000.

He questioned why the government set the 2% trigger level if they were not happy for councils to go up to that figure.


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  • rate this

    Comment number 20.

    Under labour council tax bills rose in Lincoln by over fifty per cent in five years - massively ahed of inflation, and additionally charges to park in the street outside your house and extra so-called 'one-off' hits for wheelie bins etc - it was unsustainable. They could take every penny the public has and find ways to spend it.

  • rate this

    Comment number 19.

    Reduce the number of councils.


    Why do we need parish, district and county councils as well as central government?
    Cut them back and concentrate on delivering cost effective core services such as education, road maintenance, bin collections etc

  • rate this

    Comment number 18.

    How about reducing the number of councilors (29,000)on £50k or more, perhaps then we would be able to have better and cheaper services?

  • rate this

    Comment number 17.

    Of course council tax has to go up year on year how else could they pay for all those final salary pensions.

  • rate this

    Comment number 16.

    1. The Ace Face “Who seriously didn't expect a rise in council tax?”

    George Osbourn

  • rate this

    Comment number 15.

    What a surprise. This will continue, same as utilities, train fares and parking. Its time for the UK public to bite back and say sorry, I can only pay you last years rates, " its the cuts you know". But sadly we'd end up in court and with a default on our downgraded credit file. UK is going down the pan I fear.

  • rate this

    Comment number 14.

    Our local council has asked that we pay an extra 27p per week so that our Police Force can employ a further 12 officers as they can't afford to employ what they need. . . . . . This is all well and good, but I believe that we are taxed to the hilt and these are just excuses to up the salaries at the top. Local councils have more than enough. £130 pm from every household in Dorset. Wheres it gone?

  • rate this

    Comment number 13.

    Eric Pickles - what a joker - his comment about the council tax rise being in effect a tax cut - if my council tax goes up by a single penny it is not a tax cut - really Eric we are not that stupid. Just like the freeze on Tax allowances for pensioners - listening to Cameron we have seemly got a massive rise!!!!. Our day will come

  • rate this

    Comment number 12.

    Essex Police's new CPC has already annouced a rise in policing in Essex. This will be given to Essex County Council, so that's one area which has already gone up.
    Other than that everything else has gone up so the council's will happily jump onto the price hike esculator.

  • rate this

    Comment number 11.

    Sounds about right. Probably for some useless projects they have in the pipeline. I want Police, Fire and Ambulance services, I want decent bin collections and well maintained roads. I also want clean public toilets and empty bins in my town centre. I don't care about anything else, most people don't so why do the council?

    And stop, STOP trying to make money off car parking. It's killing towns.

  • rate this

    Comment number 10.

    Why are the raises even necessary? I though the local authorities had a cash pile that they could draw on when times were considered tough.

    Or are the increases needed to ensure the 6 figure salaries of the managers are maintained?

  • rate this

    Comment number 9.

    In Brighton and Hove we have a Green led council, they have spent millions digging up the roads to add cycle lanes, yeah a nice touch but essential I think not. So I shall have to reach into my bottomless pit of money and pay the increase !

  • rate this

    Comment number 8.

    Austerity has teeth, expect to be bitten. Triple A status: Austerity Austerity Austerity.

  • rate this

    Comment number 7.

    Refuse collections halved, loss of local services and council tax is still going up , why's that ?

    If councils need to take legal advice and using loopholes to extort more money from the tax payers then there's something obviously not right.

  • rate this

    Comment number 6.

    Council tax is regressive. It's time to replace it with a locally-set income tax collected through the existing PAYE system. It would cost a tiny fraction of the current system to implement and run, wouldn't be regressive like council tax.

    Based on current council tax rates, it would be roughly a 4% flat rate.

  • rate this

    Comment number 5.

    Wait, local councils admit they are TRYING to find loopholes to exploit Joe public even more? Surely THAT should trigger a referendum! What's next, MPs claiming false second homes and using our taxes to fix their homes/pay for their commuting which any normal soul pays for them selves. Oh.... wait a second

  • rate this

    Comment number 4.

    How about reducing the number of councils?

    Is what they do in Forest Heath district really different to what goes on in Selly Oak?

  • rate this

    Comment number 3.

    Council tax up is just the least of it. The local council have hiked car parking, market stall fees, sports centre fees, in fact everything they possibly can. Its a fiasco.
    Government needs to SCRAP council tax. Fund councils TOTALLY from central government, no charges, no fees, no car parking charges allowed. Fund based on people and business in the area. Thats it. Locally choose how it is spent.

  • rate this

    Comment number 2.

    I'd happily pay a lot more council tax if they collected my bin every day (no more recycling), cleaned all the cars in the street, built sheds for everyone, free pick n mix for the kids, THIS IS WHAT GOVERNMENT SHOULD BE DOING for the citiznes like in Finland

  • rate this

    Comment number 1.

    Who seriously didn't expect a rise in council tax?


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