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
    -1

    Comment number 280.

    If we were to remove all the comments from people whose sole knowledge of local government derives from the headlines in right wing tabloids, the remaining few could have an informed debate on the merits or otherwise of financing local councils.

  • rate this
    +1

    Comment number 279.

    Well, someone has to pay for them all to retire at 60 with pensions, that we in the private sector, can only dream of as we slave on till 68!

  • rate this
    +5

    Comment number 278.

    @261.aphoristic
    So you have no use for the other things that your council tax pays for either then such as the police force, fire brigade, etc.

  • rate this
    -1

    Comment number 277.

    Scrap personal income taxes - scrap "council tax" -sales taxes only
    Local sales tax to cover local services/councils.

    Yes everything would be more expensive , but then maybe the value would become important in purchasing decisions and help to reduce the "its last years model , throw it away " waste .

  • rate this
    -2

    Comment number 276.

    People need to wake up to the reality of the Government's propaganda campaign against local councils. Over the last four years national taxation has risen by £51.2 billion whilst council tax has risen by £1.5 billion. Why not ask where central govermment is spending all of our money through these mainly invisible national taxes?

  • rate this
    0

    Comment number 275.

    Is it not common sense that tells you, with a Conservative Government comes decreased central funding (in an attempt to privatise central services), and therefore a need to increase funds from somewhere else. Where does that come from? The same place as the funds for these large central contracts handed out to blundering big business - THE TAX PAYER!

  • rate this
    -9

    Comment number 274.

    Councils are making a right pickles of this dog of an incompetent govt. They are making fools of them, sitting on funds of £16bn, having front loaded their cuts, they are now re-hiring all those they sacked, and wasting £millions. Most of the Tory controlled Councils are out of control, and in wealthy areas doing as they please. They know govt dare not take them on!

  • rate this
    +4

    Comment number 273.

    Councils have lost the plot, they are still wasting money as fast as they can. They claim poverty yet still build posh new offices. If they can get rid of so many staff all at once, they did n't need them in the first place. They are pathetic.

  • rate this
    0

    Comment number 272.

    Hows about this for an idea. If I take my own trash to the dump, police my own streets and everything else I pay council tax for. I get a huge reduction in my council tax?

  • rate this
    +1

    Comment number 271.

    266. Commrade_Dave
    oh sorry, in most countries, if you are healthy and don't work, you don't get paid. You deserve others' tax money, why? because you tried harder? Or because you were born in the UK?
    Not much of a human right issue is it?
    If you have the money for the bullet, please hand it out to the poor, they need it for dinner.

  • rate this
    +2

    Comment number 270.

    I'd like them to be much quicker at repairing road pot-holes.

    I replaced a buckled alloy wheel on my car only for the new one to be damaged barely 2 weeks later. There are now 2 buckled alloys on my car and it's clear that there's just no point in replacing them with the roads in their current dire state.

  • rate this
    +5

    Comment number 269.

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

    What is the priority?
    Why its maintaining high paid jobs on the council and final salary pensions for the big knobs.
    Government is proposing "son of poll tax" by reducing or eliminating council tax benefit. Watch this rocket once it comes in and watch the civil unrest it produces the same as last time.
    Its a scam!

  • rate this
    +2

    Comment number 268.

    256.

    Good they should easily be able to afford to pay a tax commensurate with the property they own. Band i,j,k,l,m,n,o,p,q,etc.

  • rate this
    +1

    Comment number 267.

    I stayed in a 16th century manor that had been in the same family for generations. The current owners were cooks, cleaners, etc and drove a rusty old car. Yet they were doing every thing they can to keep the house in the family. Should we tax folk like this more for the same rubish services we all get. Like wise all the old folk near me who have £mil plus homes they paid £50k 25 years ago.

  • Comment number 266.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • rate this
    +3

    Comment number 265.

    I would say that any council chief who can't get through the next 12 months with the same funding as this year ought to be kicked out. All over the country, businesses and individuals are cutting their spending and trying harder to make ends meet. There's no reason whatsoever that unimaginative, lazy, overpaid council leaders cannot try to do this too.

  • rate this
    +12

    Comment number 264.

    PS. (re #241 below) My Council Tax in Corfu is €23.59 every 2 months. My Local Authority Water Taxes are €35 every 4 months for water fully up to EU standards (unlike yours!). Both are being reduced this coming year because the highly efficient council made too much profit last year. (Not everything in Greece is crazy - Local Councils are highly efficient.)

  • rate this
    +3

    Comment number 263.

    260

    Nice attitude! You better hope you dont get old or ill then

  • Comment number 262.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • Comment number 261.

    This comment was removed because the moderators found it broke the house rules. Explain.

 

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