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Last Updated: Thursday, 2 March 2006, 09:42 GMT
England council tax 'up by 4.5%'
Council tax bill
The council tax rise is the second lowest in a decade
Council tax in England is to rise by an average of 4.5% this year, according to a survey by the Chartered Institute of Public Finance and Accountancy (CIPFA).

Figures from nearly two thirds of billing authorities suggest an average Band-D home bill rise of 53, to 1250.

Despite being more than twice the rate of inflation, the council tax rise is only marginally above last year's and the second lowest in a decade.

But the Isitfair campaign group says the rise is too much for pensioners.

Despite the relatively small increase in bills overall, the group, which campaigns for local tax reform, says elderly people will be hit as it comes on top of big rises in heating costs.

Marginal rise

Two pensioners were jailed last year for withdrawing part of their council tax and many others have also threatened to pay inflation-only increases.

Government threats of capping appear to have worked, with many councils coming in just under the perceived 5% capping limit and only a few going above.

The chief executive of CIPFA, Steve Freer, said the government's efforts to keep council tax increases under control appeared to be working.

If he doesn't hand over that 200 to pensioners, I think there'll be a terrific, bitter feeling in the nation
Eric Pickles
Conservative local government spokesman

"It is very clear that the government at the centre is very, very keen to keep council tax increases under control.

"It's using the threat of capping local authority budgets to impose that control and the vast majority of authorities have clearly heeded that message and are setting below that level."

In London, the prospect of elections in May appears to have had an impact.

Spending contracts

At least five boroughs have frozen bills at the current level - their charges only increased by the rise in Ken Livingstone's mayoral precept, which includes a payment towards the 2012 Olympics.

Chairman of the Local Government Association Sandy Bruce-Lockhart said the rise was higher than councils had wanted, but spending was difficult to control as it involved contractors.

"So much of what local government spends now they contract with the private sector.

He said the Department of Trade and Industry found road maintenance cost had risen 6.5% while street lighting costs were up 18% on new contracts.

"So if you're getting an increase of two or 3%, it's very hard to meet those costs and keep council tax down."

Local government minister Phil Woolas said the government was not to blame for the increase.

"We have put a cap on it. The councils themselves set the council tax."

He added that Labour councils were "coming in the lowest and the Liberal Democrats and Conservatives, higher."

'Bitter feeling'

However, the Conservatives' local government spokesman, Eric Pickles, said council tax "has increased by 84% under Labour, and people on fixed incomes, particularly pensioners, have been hit hard".

Mr Woolas had been unable to confirm on BBC Radio 4's Today programme whether pensioners would receive 200 payment to help with council tax.

Mr Pickles said this meant pensioners had been "abandoned by the Chancellor".

"If he doesn't hand over that 200 to pensioners, I think there'll be a terrific, bitter feeling in the nation," Mr Pickles said.


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