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The annual Chartered Institute of Public Finance and Accountancy (CIPFA) council tax survey shows that while 85% of councils in England are freezing council tax, at least 43% of households will still see some increase in their council tax bills

The difference arises because household council tax bills are made up of charges from several different authorities. For example, charges for some emergency services are collected by the local council.

The Department for Communities and Local Government has urged councils to freeze council tax this year and offered them funding to do so. Despite the number of households who are seeing an increase in their council tax bill, the survey shows that overall the response to this offer from councils has generally been positive. Councils which have declined this offer will almost certainly be focusing on the difficult financial challenges which they expect to face in 2013/14 and beyond.

Of those authorities increasing tax, none are increasing by more than 4.0%. Following the introduction of the Localism Bill, local authority constituents now have the right to a referendum on council tax if it increases by over a percentage pre-determined by central government. This percentage is currently 4.0% for police and fire authorities and 3.5% for other authorities and, at present, no councils are set to exceed this limit.

Across England, the average band D council tax bill has increased by 0.3% (£4.39). This is a relatively small increase compared with last year’s average which was a decrease of 35 pence.

The survey also shows that there are disparities between regions. The largest average increase for aband D council tax bill is in the North East where it will rise by 0.9% or £13.43 while Greater London will see a decrease of 0.3% or £4.19.

Ian Carruthers, CIPFA Policy Director, commented,

Councillors must take council tax decisions based on local priorities. For the most part, councils have responded positively to the Government’s offer of council tax freeze funding for 2012/13. Where rises are planned none appear likely to trigger a local referendum.

“Service and job cuts are likely to continue as councils must balance their budgets. Our recent survey of finance directors’ confidence is indicating that there is significant anxiety about the financial years 2013/14.

 

Written by Scott Buckler
Thursday, 01 March 2012 9:09

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