England’s parliamentary leaders have criticized Rishi Sunak for calling on local authorities to show “restraint” in introducing council tax bills, saying the government is to blame for the funding shortfall.
The Prime Minister said on Friday that “local assemblies have an obligation to respect the people’s demands for household finances,” and called on authorities to “curtail increases in city taxes that local governments are introducing.”
He singled out British councils for criticism for seeking permission to raise council tax by more than 5% to balance budgets at a time when local government finances are facing a national crisis.
Mr Sunak’s comments were made this week despite the government give permission It called on a number of councils, including Thurrock, Woking, Slough and Birmingham, to raise taxes above the 5% cap. But ministers refused to allow the same to happen in Somerset, as the county’s council leaders seek to close a £100m budget deficit.
The Guardian also reported last month that officials from Michael Gove’s Department for Level Up, Housing and Communities told parliament that council tax was to be raised by up to 4.99% in April, and some Tory officials also revealed that it was concerned that this could negate the impact of the national tax. cuts promised in next month’s budget.
Mr Sunak told BBC Radio Somerset: “It’s important that councils control the cost of living for residents, and it’s also important that councils are demanding that the government accept incredibly high council tax rises. ” he said. [that] That’s not correct. ”
But Sir Stephen Houghton, the Labor leader on Barnsley City Council and head of a group of 48 city authorities across the North, Midlands and South, said the Prime Minister should exercise restraint at a time when the government is underfunding councils. He said it was “astonishing” that he had called for this.
“For 13 years, the revenue support grant to councils has been reduced. It’s been a government decision and councils have had to increase council tax as a result,” he said. “For several years now, the government has told councils to fund adult social care through increases in council tax.
“The government has cut funding to the poorest councils by keeping the business rates system in place. There is a £4 billion shortfall to deliver services and the government has decided not to make it up,” he said. This is a government decision.”
Councils wishing to raise taxes beyond the 5% limit must either seek permission from the central government or hold local referendums. Bedfordshire is the only council to hold such a referendum, with voters rejecting the idea in 2015.
Councilor and Local Government Association (LGA) Labor group leader Necile Caliscan said:
“The cause of the dire situation in local government is the cuts to council budgets by successive Conservative governments.
“Congress is left with no recourse to raise the funds needed to meet the growing demand for homeless, child and adult social care services.”
Councilor Pete Marland, who also chairs the LGA economy and resources committee, said the amount of funding available to the council was “outside the requirements placed on the council”.
“The council has led the way in finding ways to save money and reduce costs, and this work will continue, but council tax will need to be increased this year to fill the remaining funding gap. Many people will need to make further savings on local services.”
“As the Standards, Housing and Communities Committee rightly highlighted, cost and demand pressures will continue to stretch council budgets to the limit.
“Without additional funding, some legislatures may struggle to set balanced budgets in 2024-25 and may not be able to do so for 2025-26.”
Subsidy to councils from central government fell by 40% between 2010 and 2020. Eight councils in the UK, including Birmingham, Nottingham and Croydon, have issued section 114 notices in recent years, effectively declaring them bankrupt.
Mr Gove announced last month that the government would inject £600m into local government funding to prevent further council collapses.
But councilors on the Local Government Select Committee said ministers needed to inject £4bn to avoid an “out of control” financial crisis affecting services such as adult social care and child protection. he warned.
