Town halls plan council tax rise


Council Tax Bill

Almost a third of town halls are planning to increase council tax next year as they struggle with funding cuts and increased demand for services, a survey has found.

Research by the Local Government Chronicle (LGC) suggests that 75% of county councils will bring in the increase, despite financial incentives from the Government to freeze increases.

The LGC said more councils than ever intended to reject the Government's funding, which is equivalent to a 1% increased in council tax.

It also said Conservative-run county councils are widely expected to bring in a rise, an open rejection of the Coalition government's financial incentives.

Across all councils, 32% indicated they would reject the offer, the LGC's Council Tax Survey found.

David Hodge, chairman of the County Councils Network and leader of Surrey County Council, said counties "face a particularly challenging set of circumstances".

He said that demand for services, such as adult social care, was rising, roads had "taken a hell of a hammering" and were costly to repair over large county areas, and many are suffering a "major shortage" in schools places.

Mr Hodge said the Government needed to choose between funding the shortfall itself, "or they have to (abandon) the council tax freeze and allow local government to raise finances depending on their circumstances".

Martin Tett, leader of Buckinghamshire County Council, told the LGC he was consulting on a increase of up to 5% because of a "significant reduction in government grant", along with strains from inflation and "demographic pressures".

And Adrian Hardman, leader of Worcestershire County Council, said a 1.8% increase would resolve the council's £3.8m annual overspend on looking after children.

Local Government Minister Brandon Lewis said he would "encourage every council" to take up the offer of funding, which would be paid in 2014-2015 and 2015-2016.

He told the BBC: "Over the last three years, the government has worked with councils to cut council tax by 10% in real terms.

"Extra funding is on the table for councils to freeze council tax for another two years.

"There is a clear choice for councillors: extra help for hard-working people with the cost of living, or higher state taxation to fund more council administration."

Of 354 councils, 154 responded to the survey, the BBC said.

Of those, 53% said they would accept the government's offer of funding, while 32% said they would not, and were instead considering a rise, likely to be up to 1.9%.

Of 27 county councils, 12 responded to the Local Government Chronicle survey, and nine of these said they would reject the extra government funding.

Two agreed to a council tax freeze for two years in return for government funding, while one did not know.

Where are Britain's highest tax bills?

Where are Britain's highest tax bills?