Copied from Local Government Chronicle online
Districts given thumbs up for tax rises of up to 8%
2 January, 2013 | By Ruth Keeling
“Low cost” district councils who have been granted leeway over council tax next year could increase rates by up to 8% without holding a referendum.
LGC has identified the 50 district councils that are set to benefit from the extra flexibility over council tax setting announced in last month’s local government settlement.
Under the proposals set out by local government minister Brandon Lewis, districts within the lowest quartile of council tax rates in 2012-13 will be able to increase tax above 2% without a public vote as long as the increase is not more than £5 in cash terms.
There are 50 district councils in the ‘lowest quartile’ with average Band D council tax rates below £142. They include Breckland BC which has the lowest council tax rate in the country at £65 and where an extra £5 equates to an 8% increase, as well as West Oxfordshire DC and Hambleton DC, where a £5 rise is a 6% increase.
Mr Lewis, speaking to councillors during a Q&A the day after the announcement, said it was only fair that “low cost” authorities be granted some additional flexibility. However, he said it was not clear the same flexibility would be offered after 2013-14.
The potential rises available to each of the 50 councils is listed below. There is no indication yet that any of the councils in question plan to take advantage of the extra flexibility available to them.
Council Maximum increase without a referendum (£5)
West Oxfordshire 6%
South Staffordshire 5%
Basingstoke & Deane 5%
North Dorset 5%
Hinckley & Bosworth 4%
East Lindsey 4%
South Cambridgeshire 4%
Vale of White Horse 4%
South Oxfordshire 4%
East Devon 4%
King’s Lynn & West Norfolk 4%
East Northamptonshire 4%
West Dorset 4%
Test Valley 4%
Malvern Hills 4%
South Norfolk 4%
West Somerset 4%
East Hampshire 4%
South Kesteven 4%
Taunton Deane 4%
Forest Heath 4%
South Hams 4%
North Norfolk 4%
East Cambridgeshire 4%
North Kesteven 4%
Ribble Valley 4%
Can we assume then that as South Holland is not featured in the qualifying list, it is NOT an existing “low cost council”; which, I suppose, equates to not being a high efficiency council…
Actually, I don’t think there’s a direct correlation between low cost and high efficiency. I’m told that Breckland for instance, has a large property portfolio and that this generates a significant amount of income thereby supplementing their budget. Also, a lot of their parish councils have relatively large precepts because they provide some of the local services directly.
As a local taxpayer, I’m as horrified as the next person when the council tax bill arrives. However, the vast majority of this bill is the county council’s cut of the pie, with the police precept taking a lump slightly in excess of the district council’s share. Bottom line is, even if SHDC halved the council tax, overall it would still be well over £1000 a year for a band D property.
I thought that the point of the allowed relief (council tax) increase was to reward/relieve those councils that had already got their house in order delivering with high efficiency, low cost services and therefore could not justify further savings. And also to motivate those councils(by denying a tax increase) that were dragging their feet in becoming cost efficient in delivering those same services. If councils, such as Breckland, have other sources of income besides the standard grant/taxation model, this surely cocks-up the calculating formula – doesn’t it?
All things being equal, I’m sure your way of determining things would be the right one. However, as soon as politics interferes, cold calculations go out of the window and sound bite numbers take precedence. However, the fact remains that it is the county council element that makes the biggest difference in all of this and anything we do at the district level is, as they say, peanuts. Has anybody bothered to calculate how much our 1/4% reduction next year will save them?