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Council tax rises to raise less than living wage bill

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Local authorities are set to raise £543m through the social care precept but even that will not be enough to pay the full cost of the national living wage bill and prevent further service cuts, according to the Local Government Association.

Analysis by the LGA has found 147 out of 151 top tier authorities are considering or have approved introducing a social care precept in 2017-18.

However, LGC’s council tax tracker revealed exclusively on Friday how fewer than half of top tier authorities will be raising council tax bills by the maximum 4.99% allowed, with many opting for regular council tax increases of less than the 1.99%.

The LGA has warned any extra income raised by the precept will be swallowed up paying for the national living wage which totals more than £600m next year.

The LGA is calling on government to use the final local government finance settlement, expected on Wednesday, to provide new money for social care. An unexpected diversion of £241m new homes bonus funding to social care also need to be reversed, the LGA said.

Lord Porter (Con), LGA chair, said money raised through council tax increases “will not bring in anywhere near enough money to alleviate the growing pressure on social care both now and in the future”.

The LGA has estimated a £2.6bn funding gap in social care by 2020.

“It cannot be left to council taxpayers alone to try and fix this crisis,” said Lord Porter. “Without genuinely new additional government funding for social care, vulnerable people face an ever uncertain future where they might no longer receive the dignified care and support they deserve. This is not only worse for our loved ones but will also heap further pressure and wasted expense on the NHS.”

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