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Majority of local authorities to raise council tax by maximum allowed

Majority of local authorities to raise council tax by maximum allowed
Paloma Kubiak
Written By:
Paloma Kubiak

Nearly every local authority with responsibility for social care in England plans to raise council tax this April by the maximum 4.99% permitted.

Out of 136 county and unitary local authorities in England that have published their budget proposals, 128 (95%) said they planned on raising council tax by the upper limit.

According to the County Councils Network (CCN) that compiled the data, the number of authorities planning maximum rises is significantly higher than this time last year. For 2023/24, 75% planned to levy the maximum rise.

For the average Band D household, this represents an average £103 annual increase – just under £2 per week.

No authority has declined to propose a council tax rise, with the lowest proposed at 2.99%.

Local authorities with responsibility for social care can levy rates of up to 2.99% for general taxation and 2% for the Adult Social Care Precept, which is funding specifically for adult social care.

CCN said upper-tier councils in county areas are “still under significant pressure”, facing a collective funding gap of £1.1bn over the next two years, even after tax hikes.

Authority leaders said they recognised the difficult tax increases “will add to residents’ cost of living”, but as two-thirds of county authorities’ funding comes solely from council tax, the 4.99% hikes “are necessary to protect vital services and help prevent financial insolvency in future years”.

Together with funding allocated from the Government, councils will have “breathing space”.

However, CCN said that with a general election this year, the Government must set out a long-term financial plan for local authorities.

‘Little choice but to put up council tax’

Councillor Sam Corcoran, vice-chair of the County Councils Network, said: “This year, councils have faced extreme financial pressures, with local authorities having to make some of their toughest decisions ever due to rising costs and spikes in demand for care services. Last month, the Government provided a very welcome £600m of additional funding for councils. This will make a tangible difference to protecting valued frontline services and in easing the pressures we face.

“Despite this, county authorities still face a £1.1bn budget shortfall over the next two years. With council tax now accounting for two-thirds of the average county authority’s funding, we have little choice but to take the difficult but necessary decision to raise council tax by 4.99% to continue to protect services and ward off the threat of financial insolvency in the future.”

Corcoran added: “No council leader takes the decision to raise council tax lightly, as we know this will add to the cost of living for residents, but councils have had little choice but to put up council tax due to the increased demands, particularly in children’s services. The next Government must set out a long-term funding plan for councils while also undertaking a comprehensive reform programme to help drive down costs, especially for children’s services and home-to-school transport.”

Related: Households face £100-a-year council tax hike