“Doubling our council tax to make it viable” – could steep rises be on the cards for your bill?
PUBLISHED: 13:07 20 February 2019
A stark warning has been issued over the need to significantly increase council tax rates in a Suffolk district in the future.
Babergh District Council approved its 2019/20 budget on Tuesday evening, where plans to increase the district council tax element on a Band D property by £5 was approved, amid a medium term plan for four years of similar increases.
But a warning was issued that while Babergh was one of the districts with the lowest levels of precept, increasing costs it was facing meant that level could not continue.
Councillor David Busby said the £5 rise will “only bring in about £150,000 a year. That’s a drop in the ocean with the output we have got.”
Mr Busby said to cover the increases in staff costs alone more than 2,000 new homes were needed, with 100% of that additional council tax needing to be used in that one area of spend.
He added: “We are really talking about doubling our council tax to make it viable.
“We have to rethink the way we do our services. It’s time we do that in the next 12 months.”
Councillor James Long agreed: “I think we certainly should be looking at a higher increase as hard as it is.”
To raise council tax by more than 3%, an authority must hold a referendum.
Conservative council leader John Ward said a referendum for such a large increase would not deliver approval.
He said: “We have to rely on innovative new things like [commercial and retail property investment arm] CIFCO, economic growth, regenerating areas to bring in new growth, new business rates.”
He added: “We know there has to be further efficiency improvements over and above the ones we have made over the last few years, and the chief executive has an ambitious plan to do that.
“We all know there are considerable challenges ahead and we are trying our best to meet those challenges.
“Babergh is in a stronger position than many authorities in the country, and indeed county councils.
“I believe what we are doing here, the two councils together, are going to weather the storm.”
While the council approved the medium term strategy, which outlines planned council tax rises of either £5 per year or 3.15% over the next four years, council tax rises will be discussed during each year’s budget setting process.