No excuse for Council Tax rises but they may be able to go even further

Local Government Minister Brandon Lewis says councils will become less dependant on funding from the centre .

The priority for councillors and their officers, over the next few weeks, will be the preparation of their final draft budget for the next financial year. These decisions will determine whether residents face council tax increases when the new bills drop through the letterbox in late March.
With the Government providing funding for another council tax freeze, most people can look forward to no change in their bill. In real terms, under this government, council tax has been able to fall, following year-after-year of eye watering increases that saw the household liability double under the last Labour government.

Obviously, I hope that every Conservative Council across the country will deliver a council tax freeze – there is no excuse not to. Of course, with County Council elections only a few months away, there is an additional incentive for councillors to deliver this key Conservative election pledge. At the General Election, this policy was extremely popular on the doorstep. It continues to remain popular as people face other rising household bills. I know some Conservative administrations plan to go even further, having calculated they can do so, by pledging a freeze for four further years.

Many councils were left a financial time bomb by the last Labour government. Eric Pickles, and the DCLG team, found additional funding to assist them in making changes to put them on a firmer financial footing. The government invested millions, to assist with a move to cut back office costs, share management and provide shared services. All aimed at providing a better long-term deal for the local taxpayer.

 

Many council leaders relished the challenge and drove forward massive reform in their councils; others dodged the responsibility preferring to blame central government for all their problems.

To be fair, some continue to suffer from Labour’s botched local government finance structure, that is why we are giving them an additional two years efficiency grant funding. My own council is one of these and I hope they will take advantage of almost £2 million to move away from a “silo management structure” that is unsustainable in a small local authority. They can continue to provide residents with good front line services without the need for everything to be provided, or managed, from within Great Yarmouth. As local MP I want to do all I can to help my area, but I will be doing Great Yarmouth, and the other affected authorities, no favours by helping them to continue using taxpayer’s money to retain top heavy and unnecessarily bureaucratic management structures. More and more councils are sharing Chief Executives, for smaller district councils this makes good economic sense. . The days of an army of Chief Executives and senior directors, each maintaining their own little fiefdoms is finished. Even if the economic climate was different, we could not justify spending money on management costs instead of services.

There was the predictable squeal of indignation from some quarters in response to this year’s local government finance settlement. Yet in the future, funding from central to local government will become less and less important. The biggest change will be the local retention of business rates, the first stage in setting councils free from their financial dependency on government. They will financially benefit from business growth and increased employment in their area.

Smart councils will be putting an emphasis on stimulating economic development to capture this extra revenue. With local support, those councils enabling the building of new homes will see further financial benefits; not just through additional tax revenue but the possibility of additional grants.

In the next few years’, district councils could really see a rise in their income while their government grant falls. This must be the way forward; it means councils will be less reliant on government. It will be easier for them to be more responsive to the demands of local communities, because they will be less responsible to Whitehall.

I know the best councillors and officers will be looking at the opportunities the new financial settlement provides. They will be looking at the innovative ways to provide services, looking at how they can work with other organisations and how they can prioritise the needs of their local communities. These will be the successful councils, who will demonstrate to residents why local government matters and the difference it makes to everyday lives.