Council tax in the UK is projected to increase by up to 5% annually, according to documents from the recent Spending Review. This rise is intended to fund local services and contribute to increased police funding. While local authorities have the discretion to implement lower increases, the Spending Review assumes the maximum permissible rise will be applied.
Key Takeaways
- Council tax is expected to rise by 5% annually to support local services and police funding.
- Local authorities can raise council tax by up to 5% without a referendum.
- The Spending Review assumes councils will implement the maximum 5% increase.
- Police precepts, part of council tax, are also expected to rise.
- Despite some new funding, councils anticipate continued financial pressure and service cutbacks.
The Expected Rise in Council Tax
The Spending Review documents indicate that local authorities are expected to increase council tax by the maximum allowable 5% each year. This measure is designed to bolster funding for essential local services, including social care, libraries, bin collection, and street cleaning. Additionally, a portion of this increase will contribute to an uplift in police funding.
While councils possess the autonomy to implement smaller increases, the government’s financial projections are based on the assumption that the full 5% will be levied. This comes amidst a backdrop of strained town hall budgets, with many councils having already resorted to maximum increases in recent years to maintain services.
Impact on Police Funding
The Spending Review also outlines a projected 2.3% annual real-terms increase in police spending power. This is partly facilitated by the police precept, a component of council tax. Police and Crime Commissioners have the authority to raise this precept by £14 per year for a Band D council tax bill without requiring a referendum, in addition to the general 5% rise.
Treasury documents suggest that the increase in police spending power is contingent on a rise in this police council tax precept. However, police leaders have expressed concerns that any additional funding may primarily be absorbed by officers’ pay, leaving little for broader service improvements.
Council and Police Federation Concerns
Louise Gittins, Chair of the Local Government Association, acknowledged some positive aspects of the Spending Review, such as support for children’s services and affordable homes. However, she stressed that council budgets would remain under "severe financial pressure." She anticipates that many councils will be compelled to raise council tax to protect services, yet still face the necessity of making further cutbacks.
Tiff Lynch, acting chair of the Police Federation for England and Wales, voiced significant disappointment, stating that the Spending Review failed to mark a turning point after years of austerity. He warned that "the cuts will continue and it’s the public who will pay the price," expressing deep concern about the implications for policing.
