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Last Updated: Thursday, 3 November 2005, 09:11 GMT
Warning over council tax increase
Council Tax notice
Claims of council tax increases have been denied by the government
Council tax bills in England could increase by 10% next year unless the government provides more funding, according to a new report.

The Local Government Association says inadequate grant increases will leave a shortfall to be paid for by tax payers.

Their report suggests council taxpayers face a 100-a-year bill increase unless the government plugs a 2.2bn "black hole" in local government finances.

Local government minister Phil Woolas said the claim was made every year.

Sir Sandy Bruce-Lockhart, who chairs the LGA, said the outlook for council tax payers was bleak unless town halls received a "substantial" injection of government cash.

The LGA claims councils in England are being forced to find an additional 2.8bn to cover the costs of legislative and policy demands from Whitehall, in addition to the needs of an ageing population.

Some of these figures are based on surveys, often by third parties who have a vested interest in talking these figures up
Local government minister Phil Woolas

The figures include additional sums of 663m for elderly and adult services, 599m for children's services and 669m for anti-social behaviour.

The LGA said that the shortfall had been partially offset by an 800m increase in government funding, although a deficit of 2.2bn remains, Sir Sandy said.

This equates to a rise of 10% or 100 on the average annual council tax bill.

Sir Sandy said: "Although ministers have confirmed that local government has been more successful than any other part of the public sector in making efficiency savings, we are still staring at a 2.2bn black hole in town hall budgets.

"The government has introduced new standards and is making ever more legislative and policy demands on councils without providing an equivalent level of funding."

Crying wolf?

A retired vicar who was jailed for 28 days in September for refusing to settle his council tax bill told BBC Breakfast he would be ready to go to prison again if bills did increase by 10%.

The Reverend Alfred Ridley, 71, from Towcester, Northamptonshire, was jailed for 28 days when he refused to pay the full 8.5% council tax rise. He and his wife Una said they objected to paying a rise above the rate of inflation.

"A lot of people are very worried about how they are going to find the missing money when there is no more money coming into their income."

"If it does go up again, we might have to do it again," he said.

The Rev Alfred Ridley
Ex-vicar Alfred Ridley says he would go back to jail over the issue

Mr Woolas said the government was keen to keep council tax rises low and would use capping powers where necessary.

"When there have been excessive rises, people have quite rightly complained, particularly on behalf of people on fixed incomes," he told BBC Radio 4's Today programme

He said that every year, going back as far as WWII, the LGA or its equivalent had said there was huge pressure on them and claimed there was a black hole in finances.

"We have been through these figures in some detail. Some of them we accept. Some of them we don't.

"Some of these figures are based on surveys, often by third parties who have a vested interest in talking these figures up."

Earlier a spokesman at the Office of Deputy Prime Minister John Prescott said the LGA "cries wolf every year".

He added that despite similar claims being made last year, when council tax increases of up to 12.5% were predicted, there was a rise of just 4.1% - "the lowest increase in 10 years".

Your comments

The government cannot go on spending money as if there is no tomorrow. They can squeeze those fortunate enough to be able to pay until the pips squeak ....my pips are squeaking and I earn above average!!
John Harrison, Huddersfield

I work in Council Revenues. The LGA is correct in what it says to a point but there is little professional management in terms on local financial management. It's outrageous also that the ODPM ignore the problem by stating LGA is crying wolf. New Labour old attitude and the whole UK population should now be asking "where does our money REALLY go....?"
Anon, SE Kent

Of course the increases were low. The government stated that it would cap any authority that went over the 5% limit, even when that increase was only a tiny sum of money because a council had been frugal in the past. The fines when this happens are high so you lose both ways.

It is also noticeable that some councils do much better than others out of the government grants. If everyone had the same percentages of their costs covered as Westminster does for instance there would be less complaint.
Thelma Blankley, St Leonards on Sea, East Sussex

My council tax bill has risen by 30% since 2000 but, from my standpoint, there is very little evidence of how all the extra money is being spent and where the benefits are. I am sure there will be yet another rise in April 2006, and that individual council tax payers will again be left powerless to contest the rises and speechless with frustration!
Jake Forman, Alresford, England

Frankly this is ridiculous and if true purely a result of bad management. I work for a company in the automotive industry as a supplier and every year our costs have to be cut, not allowed to increase. The public sector has run away with itself and the Government is to blame, too many people doing jobs that aren't needed and those that are in local Government being paid too much for too little.
Piers Catton, Gosport

In the 5 years I've owned a house I've seen my council tax bill rise by 200 already. This is during a period that firefighting services have had no serious investment, the police are still as helpless as ever and the scandal regarding local MP's "expenses" came out. Why should I pay more and more money based on the amount of money the local council and the government waste?
Dave, Birmingham

Why council tax bills could be set to rise

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