There has been speculation and media coverage on upcoming levels of council tax.
The government has confirmed it will be continuing the previous government’s policy of a core council tax cap of 3%, and an additional 2% for local authorities with Adult Social Care responsibilities. Councils will not be able to raise council tax by more than this rate without holding a local referendum. This is in line with the OBR forecast made under the previous government.
We do not recognise claims of a £2.4bn funding gap. Speaking in the House of Commons on Thursday, Housing Minister Matthew Pennycook set out that this figure failed to take account of funding sources including more than £300m raised through business rates and £300m through new houses becoming eligible for taxation.
We appreciate the significant challenges faced by local government and the need to balance proper funding for councils with limiting the financial burden on households. The government is focused on fixing the foundations of local government by rebuilding the sector from the ground up. This includes a £1.3 billion uplift in the Local Government Settlement announced in the Budget to help councils deliver essential services, providing greater stability to areas by moving towards multi-year funding settlements and ending competitive bidding processes for pots of funding.