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Exclusive: Half set to snub maximum 5% council tax hike

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Fewer than half of councils will be raising council tax bills by the maximum 5% allowed in 2017-18, LGC’s Council Tax Tracker reveals.

 

While more than two thirds of top tier councils are planning to make use of the new 3% social care precept in 2017-18, the amount of income councils will generate overall is set to fall below the extra £652m communities secretary Sajid Javid previously outlined.

His calculation was based on all top tier local authorities taking up his offer of using the new 3% social care precept in addition to a 1.99% regular council tax increase.

LGC has obtained full council tax proposals from reports and budget papers for 146 out of 150 top tier authorities, excluding the City of London Corporation and Isle of Scilly Council. The proposals have either been agreed or are in the process of being decided upon.

LGC found 70 (or 48%) top tier councils are planning to raise bills by the maximum 4.99% allowed without needing to hold a referendum.

This includes exactly half of all of London’s 32 boroughs, 22 out of 36 (or 61%) metropolitan councils, 24 out of 55 (or 44%) unitary authorities, and eight out of 27 (or 30%) county councils. Surrey CC, which threatened to hold a referendum on a 15% council tax hike only to drop the proposal at the last minute, is among those set to implement a 4.99% increase next year. Surrey’s leader David Hodge (Con) and Mr Javid have denied a deal had been done behind the scenes in response to the threat of the referendum, although the county and its districts are now set to pilot 100% business rates retention.

Looking at the political leadership of the 70 councils proposing the maximum hike, 42 are Labour-led, 22 are Conservative-controlled, while six are in a state of no overall control.

Even allowing for councils which have recorded their proposed council tax hikes between 4.9% and 4.99%, there are 86 (or 59% of all top tier councils) in total planning such a move.

LGC’s Council Tax Tracker in brief

  • Proposals for 146 out of 150 top tier councils
  • 48% are to raise council tax by 4.99%
  • An extra 11% to raise council tax by between 4.9% and 4.98%
  • 21% of councils planning a 3.99% increase
  • Overall, 97% of authorities plan to implement a social care precept of some sort - either 2% or 3%
  • Of those, 68% plan to raise the precept by 3%
  • 7% - 10 top tier authorities are proposing to freeze regular council tax
  • Three local authorities freezing council tax and not implementing a social care precept

While 70 are planning the maximum increase, LGC research has found there are exactly 100 local authorities planning to implement the 3% care precept. This trend was first revealed by LGC in January when initial research showed the majority of local authorities were set to add the extra 1% on to the precept.

When broken down proportionally, the biggest take up of the 3% care precept was among metropolitan (77%) and unitary (75%) councils. Just under half (48%) of the county councils have proposed to use the maximum precept amount.

Of the 100 councils set to raise the social care precept by 3%, 57 are Labour-led, 31 are Conservative-controlled, and 12 are in a state of no overall control.

There are 42 councils which have either already agreed to or are proposing to stick with previous plans of raising the care precept by 2% next financial year. This means that overall, 97% of all top tier councils plan to implement a social care precept in 2017-18.

There are four local authorities – all London boroughs – which are not set to increase the social care precept at all in 2017-18. These are Hammersmith & Fulham LBC (Lab), Hillingdon LBC (Con), Kensington & Chelsea RBC (Con), and Newham LBC (Lab). Of those only Kensington & Chelsea is proposing a regular council tax increase of 1.99%.

In addition, Labour-led Ealing LBC is planning a 2% increase in the social care precept while freezing regular council tax.

There are 30 councils – a third (33%) of which are county councils – which are planning to stick to the previous maximum council tax hike of 3.99%.

Of the 30 councils, 14 are Conservative controlled, 13 are Labour led, two are in a state of no overall control, and one – Sutton LBC – is run by the Liberal Democrats.

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