Concerns over council tax veto plans

PARISH and town authorities could be forced to cut back on vital community projects if government plans allowing people to vote against excessive council tax rises go-ahead, it has been warned.

The Suffolk Association of Local Councils (SALC) has spoken out about Whitehall proposals that would allow members of the public to hold a referendum and veto large tax hikes.

While they believe this is sensible for district and county authorities – which already receive extra funding through central government and the likes of business rates - they feel it would severely harm the work of parish and town councils, which do not have large sources of income.

They fear it could mean they are less reluctant to take on community projects which require a rise in the precept because they are concerned about the chance and potential cost of a referendum.

It could also cause problems if the authority needs to increase spending in an emergency, for example if they have to repair the roof of a village hall, SALC claim.

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The new coalition government is currently consulting on a paper which if made law could see members of the public call for local referendums to veto excessive council tax increases.

Shona Bendix, chief executive officer with SALC, has now written to the county’s MPs on behalf of parish and local councils.

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The letter says while they are aware of the particular concerns the government has in relation to the more expensive principal local authorities – district and county councils – the effect of these proposals on local town and parish councils is “cumbersome, costly and counter-productive” to communities.

“One of the aims of the proposals is to tackle centralisation and yet the one tier of local government that is already very accountable and embedded within the communities it serves and could provide the desired strengthened community voice will have less freedom to act for its community,” the letter says.

“Local councils do not have the comprehensive funding and expenditure streams of the other tiers of local government and their reserves are modest which means they are singularly vulnerable to fluctuating and legislative demands.

“As their role is to serve the community they need the flexibility to act for their local community as and when the need arises and raise the precept accordingly.

“Knowing the cost of a referendum would be automatically incurred if a community project proceeds, will mean in many cases that local councils are deterred from taking them on.”

SALC - which is calling for all local councils to be consulted about the plans - fear the threat and cost of a referendum might also put in jeopardy the optional expenditure of local councils to provide annual grants to voluntary and community groups.

“One of the problems is that the automatic deeming of certain precept levels as ‘excessive’ is a technical and reactive centralised assumption whereas providing an option for communities to challenge precepts would be a more intelligent, grass-roots led process,” the letter adds.

Last night Sue Brotherwood, clerk to Sudbury Town Council, said they were broadly supportive of SALC’s comments .

She said the government’s plans would mean local people had more say about their communities.

“It will stop people running away and spending what they like,” she said. “However the plans have to be very carefully thought through because on the other hand you do not want people to stifle necessary improvements or repairs.”

A spokesman for the Department of Communities and Local Government declined comment, saying the policy was still in its consultation stage and no final details had been agreed.

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