THE BLOG

Double-Inflation Busting Council Tax Hike of 4.2% for Welsh Families

17/03/2014 12:52 GMT | Updated 17/05/2014 10:59 BST

Welsh councils have finalised their financial plans and set council tax rates for 2014-15, without the luxury of measures introduced in England to keep bills down.

Hard-pressed families in Wales will, over the coming days and weeks, be receiving council tax bills with increases ranging from three to five per cent. Bills are now set to rise by an inflation-busting average of 4.2% because the Labour-run Welsh Government has not acted to bring bills down. The average Band D council tax bill in Wales has already risen by 150% since Labour came to power in 1997.

The picture is very different elsewhere in the UK. In Scotland, council tax has been frozen for the past seven years, while many households in England are currently enjoying the fourth successive year of a council tax freeze. The UK Government is providing money to councils to enable them to freeze bills and the majority have done so. To protect families from the few councils who've flouted the freeze, a referendum threshold of 2% has been introduced to prevent excessive rises. If any English council chooses to increase by council tax by more than 2%, they will be forced to hold a local referendum to seek the permission of local taxpayers.

With almost every single council in England either freezing council tax or limiting rises to less than 2%, households are getting a real terms cut for the fourth consecutive year. Together, the freeze and the referendum mechanism have helped keep council tax bills down in England and support people through the recent tough economic climate.

In the Cardiff Bay Assembly, Welsh Conservatives have been calling for the Labour-run Welsh Government to adopt some of these measures to give families the same protection from council tax hikes. Year after year, the Welsh Labour Government received money from the Treasury specifically for a council tax freeze, but unfortunately it was spent on other projects. Labour's Local Government Minister refused to introduce the 2% referendum threshold, but made an informal statement to the effect that councils should not increase council tax by more than 5% in a year. Three Welsh councils have chosen to increase their bills by 5%, namely Labour-led Swansea, Conwy and Plaid Cymru-led Ceredigion. Welsh Conservative-led authority Monmouthshire has one of Wales' lowest rises, below 4%, despite receiving the lowest level of funding per head of the 22 local authorities in Wales. It remains disappointing that the Welsh Government didn't give Monmouthshire and other councils the funds to freeze bills.

Welsh Labour will point to figures showing that on average council tax is higher in England than Wales, but the gap has narrowed by 10% in just four years, and the proportion of income spent on council tax in Wales is now overtaking that in England.

Welsh Conservatives are a low tax party. We want people to be able to spend more of their own money and that's why we want to keep taxes down. People spend money better than governments do. It also makes economic sense because if people have more money in their pockets, they are more likely to spend it on goods and services, injecting cash into our economy.

As Welsh families receive their council tax bills over the coming weeks, these rises and the lack of protection for Welsh families emphasises the differences between a Labour Welsh Government and a Conservative-led UK Government. While Welsh Conservatives will continue the fight for a low tax economy in Wales where families can keep more of their own money, I hope people across the UK will take notice of what Labour is doing in the one part of the country where it is in government. Welsh Conservatives will continue to spread the low tax message and ensure that hard-pressed families know why they are being stung this spring - because a Labour Welsh Government failed to protect you.

Mark Isherwood AM is the Shadow Minister for Local Government, Communities & Housing and Assembly Member for North Wales