‘Fundamental review’ of council tax system is needed, claims Yorkshire council leader

East Riding of Yorkshire Council,  council leader Steve Parnaby.
East Riding of Yorkshire Council, council leader Steve Parnaby.
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A YORKSHIRE council leader has called for a “fundamental review” of the council tax system after it was revealed that English authorities are set to rake in more than £1bn due to rises next year - yet the sum fails to offset Government funding cuts.

East Riding leader Coun Steve Parnaby has also called for a review of the way adult social care is funded, claiming the Government is “shifting the burden” onto local authorities by forcing them to increase the amount they charge local ratepayers to pay mounting care bills.

Earlier this month East Riding approved a 5.99 per cent increase in council tax, of which 3 per cent is for the social care precept.

Across England, 64 councils are considering or have approved increasing council tax by 5.99 per cent - the maximum they can without triggering a referendum, analysis from the Local Government Association (LGA) has shown. Authorities in Rotherham, Wakefield, Sheffield, Kirklees and Bradford have already approved the same increase, and Calderdale is set to vote today.

LGA chairman Lord Porter has warned the hikes will fail to offset cuts of £1.4bn in funding from central government and additional expenses from the national living wage - forcing further cuts to services like parks, children’s centres, libraries and pothole repairs.

Coun Parnaby said: “We have a four-year financial plan and we still have a £10m gap - of that £10m, £8m is for social care. The precept goes somewhere towards it, but the Government is shifting the burden to local taxpayers rather than national taxes - it removes accountability.

“If we are just passing on national tax increases, that’s really not what the council tax system is about. It needs a fundamental review.

“The cost of adult social care is something that is only going to get worse as people are living longer. Tinkering around at the edges is not a solution.”

The LGA said 147 out of 152 of England’s social care authorities are set to charge a precept for social care, raising an extra £548m for care. But Lord Porter said the extra money will be “wiped out” by an estimated £600m extra needed to cover increases in the national living wage.

Rotherham Council’s leader Coun Chris Read said it was “evil genius” from Government to make local authorities responsible for social care - increases in which would be more impactful in traditionally Labour voting, poorer areas.

“We are still looking at reducing services by something like £6m in the coming year, and about 100 jobs will go,” he said. “The increased pressure of social care, combined with cuts, are squeezing councils to the brink. We cannot continue on this precarious road.”

North Yorkshire raised its council tax by 4.99 per cent earlier this month - including 2 per cent for the precept.

Leader Coun Carl Les said the authority’s “historically low” council tax was reluctantly increased as it had reached the point where there were no further back-room or efficiency savings could be made to offset the cuts it received from the Government.

“If we hadn’t raised council tax, we would have to make an extra £3m in savings,” he said. “We know we’re asking a considerable sum of people - but we have pressures going forward, care for elderly being the biggest.”

Last week Yorkshire’s largest authority, Leeds, approved a 4.99 per cent rise in council tax.

Deputy leader and executive member for resource and staffing, Coun James Lewis, said: “In 2010, for every £1 in council tax, we got £2 in Government grants. It’s complex, but now, for every £1 people pay we’re getting the equivalent of 16 pence. The Government support has been reduced to little or nothing.”

A spokesman for the Ministry of Housing, Communities and Local Government said: “As part of our finance settlement we are delivering a real-terms increase in resources to councils over the next two years, more freedom and fairness, and greater certainty to plan and secure value for money.

“We want to work with local government to develop a new funding system for the future and encourage councils to submit responses to the review currently under way.”