Surrey CC has warned it could be heading for a referendum on a council tax increase, only a year after a previous proposal to ballot residents ended in a fiasco.
A report to the council’s cabinet last week said it could be forced into this move unless the government helped with the £100m costs of a flood defence project.
Surrey last year announced a poll on a 15% council tax increase to fund social care, only to drop it at the last minute amid allegations that leader David Hodge (Con) had sought a ‘sweetheart deal’ for Surrey with the government. The council imposed a 4.99% council tax rise - just below the limit which would trigger a referendum.
The current funding shortfall stems from the Environment Agency expecting a £103m contribution towards the £588m River Thames Scheme – a series of flood defence measures partly within the county.
The council has said it cannot afford this and is anyway not legally obliged to pay, but recognised some 30,000 homes could be at risk of inundation were the scheme scrapped through lack of resources.
The report by Colin Kemp (Con), cabinet member for highways, environment and flooding, said: “If a funding solution to this issue is not found then future flood events are likely to cause significant social and economic harm to residents in Surrey… it is not practical however to raise sufficient local contributions with very large-scale projects such as the River Thames Scheme a project of national significance.”
He said Cllr Hodge should tell the government not to seek local contributions and that Surrey had no capital reserves to pay what the agency wanted.
Surrey would be willing to borrow the money involved, but only if Whitehall covered its borrowing costs, Cllr Kemp said.
Failing that, ministers should allow a precept for flood defence like that for social care.
The report said: “In the absence of a different approach to funding or a change in the council tax referendum threshold, if the council is not able to fund a capital scheme within the constrained budget available any solution is likely to be dependent on successfully holding a referendum.”