Council Tax Bills In England Set To Rise By 3.9%

A survey carried out for BBC Radio 4's Today programme by Cipfa, the public accountancy institute, has suggested that council tax bills in England are set to go up by an average of 3.9%. Cipfa’s survey showed average bills for a Band D home will go up by £52 a year to £1,370.

The government expressed that it wanted council tax rises to be kept below 5% but of the 250 councils surveyed only 19 appeared to comply. The council tax increase will come into force this April and is said to be the lowest rise in 14 years.

The increase, however, will still be above inflation and several council leaders have warned that in order to keep to the governments demands and keep increases below 5%, they have been forced to take "difficult decisions" on spending.

Chairman of the Local Government Association, Sir Simon Milton, said:

"Keeping council tax down has been made harder by several government departments shifting extra costs on to councils whilst limiting funding from central government to a real-terms 1% increase.

"Council tax would have been a lot lower with a more realistic central government grant. The toughest financial settlement in a decade has left councils with difficult decisions to make locally."

The rise in council tax bills is largely due to sharp increases in the costs of policing, including the employment of more Community Support Officers.

Local Government Minister John Healey said there was no excuse for excessive council tax increases. He said the government would continue to use its capping powers to protect the public.

"By cutting waste, councils could save as much as £1.5bn, which could be used to invest in local services or reduce pressure on council tax bills."

Joe Harris, general secretary for the National Pensioners Convention said that this year's council tax bills even below 5% would still "bring more misery to millions of pensioners who are already struggling to meet rising food and energy bills."

He said: "The average band D council tax of £1,374 now represents around a third of a pensioner's spending. Council tax of £26.42 a week is around 30% of the £87.30 weekly basic state pension and this year's £52 rise in council tax will also swallow up a third of the £3.40 a week extra pension due in April."

"The government has no solution to the unfairness of council tax, apart from asking pensioners to claim discredited means-tested benefits. We urgently need complete reform of the system that takes account of the ability to pay," he added.

In agreement with Mr Harris, shadow local government secretary Eric Pickles said it would be the most vulnerable who will suffer the most, including the elderly and those people on fixed incomes. In a statement Mr Pickles said, "It is shocking that council tax has doubled in 10 years of this Labour government."

Already many households are living on a tight budget due to the effects of the credit crunch. With lenders stopping their 100% plus mortgage deals and thousands of borrowers coming off their fixed-rate mortgage plans this year, personal finance will see many struggling to stay in the black.

The Conservative Party agreed that council tax payers would be faced with the difficult challenge of juggling increased bills with rising gas, water and electricity costs.

According to the survey Wakefield, Derby, Leicester and Slough will have the highest rise in council taxes by almost a complete 5%.

Published on February 29, 2008