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Local authorities have been granted permission to increase the Council Tax by twice the rate of inflation next year, six per cent, without needing the consent of their residents in a referendum. This includes three per cent for the general Council Tax and a further three per cent for the adult social care precept.

Sajid Javid, the Communities and Local Government Secretary says:

“I am aware of the pressures facing councils and this is why I am giving them more flexibility, so they have greater control over the money they raise to address local needs.

“This strikes a balance between giving councils the ability to make decisions to meet pressures and ensure that our most vulnerable in society get the support they need while protecting residents against excessive Council Tax bill rises.”

The problem is that in giving councils more flexibility, he is giving the voters less flexibility. Council Taxpayers’ “control over the money”, their money, is being eroded. What if residents feel the Council Tax they are paying is already “excessive” and therefore would veto a rise – let alone an inflation busting one?

When Sir Eric Pickles was the Secretary of State there was a change in the role of the Department for Communities and Local Government.   Instead of fighting for local government in Whitehall it became the champion of council taxpayers in town halls. For some Ministers the highest praise is to be regarded as a “friend of the sector”. Instead Sir Eric challenged the vested interests his predecessors had so readily appeased. Localism meant giving power to local communities – not their rulers.

Now the DCLG shows a danger of reverting to type. It is being done gradually. For 2014/15 it was two per cent, The same limit was maintained in 2015/16. For the last year, 2016/17  it was four per cent. This financial year it is five per cent. Now we find out that the next financial year it will be six per cent. That direction of travel is unwelcome, especially for the poorest who are hardest hit by Council Tax bills.

Some dislike referendums, arguing that if you think the Council Tax is too high you can vote out your councillors. The difficulty in practice is that Conservative councils are often just as spendthrift as Labour ones. The rise of the municipal Corbynistas may change that. Already we see that Momentum are set to take control of Haringey Council next year.

Yet perversely the gradualism of the Government’s changes would prevent the far left being able to do anything really dramatic – unless, of course, they were prepared to take their chances with a referendum. Last year Conservative-run Surrey County Council threatened to hold one for a 15 per cent rise, but then bottled it. Olly Martins, then the Police and Crime Commissioner in Bedfordshire, actually went ahead with a referendum for a 15.8 per cent increase in the council tax precept for 2015-16. The result was 91,086 voters (30.5 per cent) supported the proposal, whilst 207,551 (69.5 per cent) opposed it.

Critical to the Government’s calculations is that the Conservatives are the dominant force in English local government. According to the House of Commons Library after the local elections this year there were 8,773 Conservative councillors in England with 5,704 Labour, 1,674 Lib Dems. and 1,577 others. Splendid. But there’s a catch. It is politically more awkward to resist complaints from Conservative councils that they need more money.

Adult social care is being put forward as a special category to justify Council Tax increases. But for all the talk of crisis there are many success stories – often councils have brought in changes that have both reduced cost and improved provision.

Incidentally the Adult Social Care provided by Councils is not just for the elderly – a significant part of the service is also for adults with learning difficulties. Many councils have made substantial progress in improving the lives of disabled residents by taking part in the Shared Lives scheme. This offers an alternative for those currently in supported living or institutional care. It enables them to be placed in a family environment in someone’s home. It can also provide respite for parents with grown up sons or daughters who they care for. As well as providing better care and increased choice it also reduces the cost.

Slapping on a Council Tax rise is the lazy option. The disabled and elderly are better served by councils being innovative. As the Daily Telegraph asks:

“The extra money local taxpayers will be required to hand over to their councils is not tied to government demands for more reform or greater efficiencies. What guarantee is there that it will not be squandered, rather than spent on the public’s priorities?”

Rather more welcome is the shift, confirmed this week, towards financial independence for local authorities, with them being able to retain Business Rates and come off the Revenue Support Grant. On this issue Javid is maintaining progress.  This will provide councils with a reward for encouraging economic growth. That might provide some easing of financial pressures for Council Taxpayers in the long term but it is scarcely a very direct or powerful protection for them.

One way that Council Taxpayers can try to shake up the system is to petition for a directly elected Mayor. Signatures are needed from five per cent of the electorate to trigger a referendum. In some places – such as Salford – they have been a proxy to oppose high Council Tax bills.

Really though, there is a responsibility for Conservative councillors and council candidates to offer voters a choice. The message must be that Labour offer wasteful spending, high Council Tax, and inefficient services. While the Conservatives offer value for money, with lower Council Tax, and well run services. That message can only be credible if it reflects the reality.

16 comments for: Next year, council tax increases of up to six per cent will be allowed without a referendum

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