HULL CITY COUNCIL is set to become the latest to defy the Government’s call for authorities to freeze their council tax bills.
A statement from the council leader Steven Brady on the authority’s website says it is reluctantly proposing an increase of 1.95 per cent for 2014/15.
It says the amount this increase generates in income for the council is dwarfed by the £20m budget cuts the council will have to make.
A budget statement from Councillor Daren Hale, the portfolio holder for strategic finance, warns that up to 450 full-time equivalent posts could be lost as a result of savings the council has to make.
He said: “As we unveil our Budget proposals for the forthcoming year, the scale of the reductions that this local authority has to contend with are breathtaking.
“In the next two years, this council will have had its Government grant funding reduced by an eye-watering £48m. This equates to 10p in every £1 we spent this year, and a proposed further 15p reduction in every £1 for the year after.
“As the Government grant makes up a far greater proportion of what this council spends in comparison to most others, the effect of such a cut to this funding is all the more dramatic than for councils with a far greater council tax income.”
The statement warned against the current system of Government making “one-off payments” to councils which agree to freeze council tax.
Coun Hale said: “Over time, this type of one-off yearly funding leaves councils extremely vulnerable financially when the funding is withdrawn, as it will be eventually.
“When that happens, after a number of years without modest increases to the base financial position, the council would face a very significant problem.
“Eventually, a decision has to be made to protect the council from additional future financial challenge and that has to be done now.
“If the Government is serious about many councils taking the one-off funding that they offer as an alternative, they need to commit to putting this funding in the on-going base funding.”