Michael Gove, the Communities Secretary, should allow Slough and Thurrock councils to go over the cap on council tax increases in April next year. Photo: LEON NEAL/GETTY IMAGES EUROPE
Council tax will rise to 10 percent in April for some households after their local town halls declared virtual bankruptcy, Michael Gove announced.
Communities Secretary Housing developers have said Thurrock council in Essex and Slough in Berkshire will be allowed to charge their bills at double the usual 5 per cent maximum set across the country.
It would mean a typical Band D bill in Thurrock could increase by £157 and in Slough by £167 if councils agree to bill at the new maximum amount.
This is the second year in a row. that two councils have been told they can increase their tax bills by 10 per cent.
The emergency rise will be introduced after both town halls issued section 114 notices, meaning they are unable to balance their budgets .
In his statement, Mr Gove confirmed that from next April other councils will be able to increase their bills by 5 per cent, which adds more than £100 to regular bills.
Conservative councilors said they were “bitterly disappointed”. ” financial settlement for local governments, saying it would put more municipalities at risk of virtual bankruptcy in the future.
Millions of people await growth
The Local Government Association has warned that one in six councils (around 60) are at risk of being issued a section 114 notice. This would mean millions of people across the country will face a council tax rise of more than 5 per cent to help balance the budget.
Birmingham declared virtual bankruptcy in September, and over the weekend the commissioner assumed responsibility for its finances. has suggested council tax bills may have to rise by at least 10 per cent there. Nottingham also issued a section 114 notice earlier this month.
However, none of these tips were included in the government's statement as discussions with town halls are still ongoing.
A number of other councils, including Bradford and Cheshire East, have warned they risk issuing such a notice.
In a written ministerial statement, Mr Gove said he would allow councils to increase their core council tax by more than up to 3 percent without a local referendum, plus an adult social assistance order of 2 percent for those with such responsibilities.
Sadiq Khan, the mayor of London, will be able to add £20 to council tax bills to fund transport in the capital. Photo: VICTORIA JONES/PA
And he said Sadiq Khan, the mayor of London, would be able to add £20 to accounts in the capital to pay for the transport network.
“The Government continues to believe that councils facing the worst financial collapse and needing multi-year government support should continue to take all reasonable measures locally to support economic recovery, including further council tax increases,” Mr added Gove.
“In the 2024-25 settlement, taking into account the significant financial failure of Thurrock Council, Slough Borough Council and Woking Borough Council, the Government therefore proposes to apply individual council tax referendum principles.”
He said for Thurrock and Slough this meant council tax could rise by 10 per cent – 8 per cent of core council tax plus 2 per cent for social care.
He said Woking council, the local authority, was more low level would also be able to increase council tax by 10 per cent, although this would only represent an increase of around £26 as Surrey bears most of Woking's bills.
“Councils that have experienced significant financial failure can take advantage of any additional flexibilities provided to support their financial recovery, and going forward the government will consider all reasonable steps to protect both national and local taxpayers and ensure councils act responsibly,” concluded Mr Gove.
He said he would consult on financial disincentives to dissuade councils from moving to a four-day week, as South Cambridgeshire recently did.
“Bitterly disappointed”
Barry Lewis, finance spokesman for the Tory-led County Council Network, said he was “bitterly disappointed” by the announcement.
“We have made a strong case for emergency funding next year to tackle significant financial headwinds. faced by councils that are beyond our control,” he said. “But despite constructive discussions with ministers in recent days, the Government has chosen to do nothing.”
Elliot Keck, campaigns director at the Taxpayers' Alliance, said: “Taxpayers will be left picking up the pieces of a chaotic financial chaos.” mismanagement endemic in city halls.
“Extravagance, exorbitant salaries and pointless home projects combine with an alarming willingness to engage in get-rich-quick schemes, creating a toxic mixture for municipal finances.< /p>
“Council leaders must make sure that next year they focus on providing key services at low prices and do not become the next to go bankrupt,” he added.
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