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Fifth of authorities to increase council tax

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Almost one fifth of local authorities are proposing to increase council tax next year, despite the government offer of funding if they freeze the charge.

LGC research shows 65 councils are planning an increase in council tax – nearly double the number who rejected the government’s freeze funding last year.

The 65 councils proposing increases ranging from 1.5% to 7.8% represent 18% of all councils who must make council tax decisions by the middle of next month.

The emerging evidence from draft budget plans currently being discussed by cabinet members up and down the country support LGC’s November survey which found 22% of finance directors thought their council would increase council tax.

Last year, only 35 councils - 10% of all authorities in England - decided to reject the government’s incentive which provided them with funding equivalent to a 2.5% increase.

The funding deal this year is only worth 1% and it appears certain that many more councils will reject the offer this time.

Ministers have urged councils not to add financial pressure on households, but authorities increasing council tax have argued in return about the need to maintain services for residents.

Councils have also pointed out that the freeze funding is a temporary offer, lasting just two years in the case of the 2013-14 offer, and will leave them grappling with a funding gap in three years’ time.

LGC has gathered information on 198 councils. Of these, 126 are freezing council tax, seven intend to cut council tax and 65 plan an increase.

Of those increasing council tax, 33 are Conservative controlled, 23 are Labour, two Liberal Democrat and the remainder of no overall control.

In proportional terms, 19% of Conservative councils are proposing a rise compared to 30% of Labour authorities.

Political controlTotal in EnglandIncreasing council tax% of political group increasing
Con1703319%
Lab772330%
Lib Dem13215%
No overall control37616%

 

None of the councils proposing an increase intend to hold a referendum, required for any rise in the relevant basic amount of council tax above 2%, and communities secretary Eric Pickles has described authorities intending rises of 1.99% as “democracy dodgers”.

Of the 65 planning increases, 41 have proposed increases of 1.9% or 2% with another 16 intending to increase council tax well above 2%.

Five of those proposing increases above 2% without a referendum are able to do so because the vast majority of their increase relates to levies paid to bodies for services such as waste and transport. Mr Pickles recently announced plans to change the rules relating to levies so any increases were subject to the referendum following representations from the councils affected.

Another 11 authorities proposing increases above 2% without a referendum are able to do so following ministers’ decision, announced in December, that low tax authorities could be exempt from the referendum rule.

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Readers' comments (1)

  • "Ministers have urged councils not to add financial pressure on households" - pot - kettle - black. Some councils are still concerned about providing services - especially to the not well off.

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