It seems that for the first time since the LibDems were in control of the York Council in 2011, a tax freeze may be applied for the forthcoming year.
The new Leader of the Labour Group on the Council is set to do a 180 degree police about turn. He says that he will freeze Council Tax levels at the present rate irrespective of whether the government provides a subsidy.
The previous regime had planned another 1.8% Council Tax increase bringing in around £1.3 million to the Council’s coffers. A higher increase than this might have required a referendum to find out residents views.
Where the £1.3 million will come from is anyone’s guess although for the last 4 years the York Council has been offered a government subsidy to freeze tax levels.
The offer for the current year was worth £778,000 and was subsequently rejected by Cllr Alexander. So there is still money to find if the pledge is to be honoured.
Last February the Council agreed a 2 year financial strategy.
Since then pressures on Council spending have continued to increase. As well as inflation, currently running at 1.3%, the number of elderly requiring care continues to rise and the Councils botched performance on waste management means that landfill tax bills are also increasing.
Add in a potential liability of over £1 million for Lendal Bridge (and maybe Coppergate) refunds and the budget looks tight to say the least.
Several of the economies forecast last February have failed to mature most noticeably in the field of social care. There an auditors report found that £3.9 million in savings had not been delivered.
There will be some good news to ease budget decisions for the Council. Fuel prices are falling, it will receive another “new homes bonus” payment from the government and business rates income will increase as the economy continues to improve.
Pretty much every taxpayer will expect that a freeze on new expenditure would be introduced at the same time as any freeze on Council income levels. The Council will need to redirect its resources to improving basic services. It will need to shelve some of its major capital projects, reduce the amount that it is borrowing and thereby cut interest and repayment costs.
“Media centres”, “access bridges” to the York central site and the like, should in future be financed by the private sector..
Over the last 4 years Council Tax increases in York have been:
- 2011/12 Freeze (last LibDem Council budget. Government subsidy accepted)
- 2012/13 +2.9 (First Labour budget – Council Tax freeze subsidy rejected by James Alexander)
- 2013/14 +1.9% (CT freeze subsidy rejected)
- 2014/15 +1.9% (Ct freeze subsidy rejected)
In all, the average York resident is paying £67 a year more in Council Tax than would have been the case if government subsidies had been accepted during the last 3 years.
The vast majority of Councils did accept the subsidy offers.