Hard-working local people could be hit with approximately a £146 increase in Council Tax next April to plug the gap in funding for social care and other services - according to a Conservative government minister and a national Tory-run council body.
The Conservative-led Local Government Association (LGA) has highlighted that after 11 years of austerity local councils face an £8bn black hole in their finances by 2024/25 just to continue delivering existing vital services.
However, that report was released before the government announced reforms to social care that will introduce a 1.25% Social Care Levy on wages on top of income tax and national insurance. Most of the revenue raised from the new tax will be channelled to the NHS, however while some of the cash will be given to local councils, most estimates are that the funding will not cover the full costs of the changes that will introduce a cap on life-time care costs. The extra expense to cover those costs will fall on already cash-strapped councils.
Now a government Minister has confirmed that the LGA and other independent research is correct and has said that the funding shortfall is likely to be made up by the need to raise council tax.
Gillian Keegan MP, the new Minister for Social Care, this week said at the Conservative Party Conference that large council tax rises are “indicative” of the direction of travel the government is taking to plug the finance gap.
The Tory-led LGA is predicting an average need for a 9% council tax rise, while other reports claim the basic council tax increase threshold may rise to 4% with an additional 6% adult social care precept meaning a combined increase of council tax of up to 10% may be on the cards.
Milton Keynes has one of the lowest council tax charges in the country with a Band D charge of £1,465.59 which is on average £150 cheaper than neighbouring Conservative authorities in Northamptonshire, Buckinghamshire and Central Bedfordshire. A 10% rise would be around an extra £146.56 a year on bills.
Councillor Pete Marland, Labour Leader of Milton Keynes Council, said:
“Local hard-working families are being hit by tax rises again and again by this Conservative government. Now the signal is that the Tories are planning to hit them again.”
He continued: “Last year, Milton Keynes saw the lowest council tax increase for five years while neighbouring tory-run councils increased theirs by the maximum amount. Unfortunately, the demand for social care is rising. The Conservatives have already dipped into the pockets of local people by putting up tax on their wages with a new Social Care National Insurance Levy, but even the Tory-led LGA and a government Minister admit that it won’t fund social care costs.”
He concluded: “The current Conservative government’s tax bill means the personal tax burden on workers is higher today than under any government since World War Two. Here in Milton Keynes, we have one the lowest council tax rates in the country. Labour is the party of low tax and value for money in Milton Keynes - but unless things change the Tories are planning another raid on hardworking family’s finances.”