Largest Council Tax Rises This Decade Loom For English Householders

Largest Council Tax Rises This Decade Loom For English Householders

Households across England will face the biggest council tax rises this decade from Friday, with annual bills for the average property set to rise by £54 in most parts of the country.

Bills are set to rise by 3.6% in 2016-17 outside of London as councils hike taxes to cover the "spiralling" cost of social care and other services.

Many councils outside the capital plan to take full advantage of the 1.99% maximum increase permitted without a local referendum, as well as the 2% precept which Chancellor George Osborne is allowing for authorities providing adult social care, according to figures from the Chartered Institute of Public Finance and Accountancy (Cipfa).

But taxpayers in the capital will be spared the worst hikes, with bills for average Band D homes in Greater London expected to increase on average by just 0.6% or £8.04.

According to Cipfa figures, Gateshead will see the biggest cash increase, with bills rising by £58.69. In Walsall, taxpayers will have to pay an extra £57.39 and Rutland's bills will go up £57.08.

Both Cipfa and the Local Government Association (LGA) have warned that further rises could be on the way over the coming years as councils struggle to make ends meet with funding from Whitehall squeezed.

The hikes follow a number of years in which council tax was kept down, with Government incentives for authorities which froze the levy.

In 2011-12 council tax in England was frozen at the previous year's rate, in 2012-13 the average rise was 0.3%, in 2013-14 it was 0.8%, in 2014-15 it was 0.9% and in 2015-16 it was 1.1%.

Cipfa's forecast for the average Band D rise across all of England, including London, is 3.1% in 2016-17.

The LGA warned that with a Government funding settlement that assumes town halls will increase their tax, "many councils feel they have no choice left" but to raise bills.

The group warned that "despite council tax rising, the quality and quantity of services on offer could drop, as the income will not be enough to offset the full impact of further funding reductions next year".

The introduction of the National Living Wage will also create a "significant further cost pressure" for councils, the LGA warned.

Communities Secretary Greg Clark said: "Our historic four-year funding deal for councils both gives them certainty to plan ahead, and meets the clear request to prioritise care for our elderly population with a £3.5 billion social care funding package.

"It means councils have the freedom to set a social care precept as part of local bills, with excessive council tax increases still subject to local referendum to protect council taxpayers.

"Even with these changes, council tax will still be lower in real terms in 2019/20 than in 2009/10 - and this year's increase will still be lower than the average 6.2% annual increase between 1997 and 2010."

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