Councils in England are planning to impose new charges on services such as public toilets, parking and green waste disposal to make up for shortfalls in funding, a report has warned.
A survey carried out by the Local Government Information Unit (LGIU) think-tank and MJ local government magazine found more than half thought they would not have sufficient funding in 2015/16 to carry out their statutory duties.
Of the 90 councils that responded to the survey, 80 per cent said they will have to increase existing charges to balance their budgets, while a “significant proportion” was said to be making plans to introduce new charges.
Half said that they were planning to increase the council tax above the 1 per cent deal offered by the Government while 55 per cent indicated they might have to dip into their reserves to make ends meet.
More than three out of four councils - 76 per cent - said that allowing them to retain more of the business rates collected in their area could ease their problems, while 82 per cent wanted to see a complete re-evaluation of the council tax system. A majority wanted to scrap the Barnett formula which allocates spending to Scotland, Wales and Northern Ireland.
LGIU chief executive Jonathan Carr-West said: “Councils across the country are telling us that the local government finance system is broken. We know they are struggling to make ends meet as they balance their budgets for next year in a system that is out-dated and not fit for purpose. Removing the bureaucracy and control of central government and giving councils control over their own financial destiny is the only solution.”
Local Government Minister Kris Hopkins said councils had received a “fair settlement” from Whitehall and warned that they should now be looking to make savings rather than add to the burden on council tax payers.
“Every bit of the public sector needs to do its bit to pay off deficit left by the last administration, including local government which accounts for a quarter of all public spending. There is no magic money tree,” he said.
“Rather than trying to increase taxes, councils should be seeking to deliver sensible savings from more joint working, improved procurement, cutting fraud and better property asset management. Making creative use of council revenues, such as through invest-to-save projects, can help lower councils’ costs.”