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Council tax rise of nearly 2% considered
9:38am Wednesday 9th January 2013 in News
The Cornwall Council council tax freeze could be about to end, as the authority considers increasing bills by nearly two per cent.
A 1.97% increase has been proposed, which would come into force in April if it is approved
The council says that budget proposals are aimed at enabling the council to continue to protect
"essential services" wherever possible from the "impact of ongoing cuts in government funding at the same time as meeting the costs of new legislation and additional responsibilities and investing in projects to boost the Cornish economy"
The rise will be considered by members of the cabinet next week.
A council spokesman said: "This is the third year of the council’s four year financial strategy which set out how the authority would deal with the £170 million reduction in government funding.
"As a result of the decision by elected members to make the majority of the savings through efficiencies and management savings in the first year, around £86m of savings have already been delivered, with just £11m coming from reductions in services.
"This has enabled the council to protect universal services such as weekly rubbish collections, libraries and leisure centres.
"However, although the council is on track to deliver the £41m savings identified for the current financial year, recent changes in council tax rules, the impact of delivering new responsibilities in areas such as welfare reform and council tax benefit means the council now has to find an additional £6.4m savings over the £24m target set for 2013 / 2014 – making a total of £30.4m.
"The chancellor has also announced further significant reductions in government funding following the next comprehensive spending review and an additional 2% reduction in funding for 2014/15 over and above the 6% already included from the previous year’s settlement.
"As a result the council is being asked to consider increasing council tax by 1.97% - an increase of 42 pence a week for a Band C property."
Council leader Jim Currie said that while they have have protected front line services from "the impact of the disproportionately large cuts in our government funding over the past two years by increasing efficiency and restructuring services," the combination of the continuing economic recession, further funding reductions and the costs of additional responsibilities means the council is now "being forced" to consider increasing council tax levels for the first time in two years.
Mr Currie said: "The budget proposals already require all services to deliver further efficiencies to cover the costs of inflation and changes in legislation.
"We appreciate that many people are already struggling to pay their bills but the scale of the financial challenges we are facing means that increasing council tax is the only option if we want to continue to provide a full range of services for people in Cornwall.
“Some people have suggested that we should use our reserves to balance this year’s budget. While this might seem like an easy option, the facts are that we will need this money to prevent cuts in future years.
"We are already planning to use some of our reserves in 2013/14 and 2014/15. Using this one off money to fund ongoing expenditure now will mean we are still faced with finding more than £13m of alternative funding or making significant reductions in services in 2015. “
Following next week’s meeting of the cabinet, the draft proposals will be discussed at special meetings of all the council’s overview and scrutiny committees being held during the last two weeks of January.
The feedback from these meetings and from consultations will then be considered before a final report goes back to the cabinet on February 13.
The final decision on the budget will be made by the full council on February 26.
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