LONDON - Council tax bills are set to increase by a whooping £100 by April next unless the Government provides a substantial subsidy for the same, local authorities have warned.
The Local Government Association has issued a report claiming that the council taxes are all set to rise by 10 percent unless the Government steps in and solves the muddle. "The government has introduced new standards and is making ever more legislative and policy demands on councils without providing an equivalent level of funding.
The proposed increase in government grant of £300m is not even enough to cover basic inflation," observed Sir Sandy Bruce-Lockhart, chairman of the LGA. Last year Chancellor Gordon Brown had allotted £1 billion to these taxes, saving at least 5 percent from this year's tax rate. The fact is that this year was an election year and Brown had to step in to make sure that the voters did not turn away from Labour.
This year there is no such compulsion. Plus, Gordon Brown cannot spare the £2.2 billion that the LGA has said would be the eventual deficit. The fact is that the economy has taken a downturn and Brown is hard pressed to stem the tide and cannot be seen as handing free gifts, especially a sensitive one as the council tax cap.
The Office of the Deputy Prime Minister has accused the LGA as living in a realm of fantasy, "Some figures that the LGA are circulating are pure fantasy. There are significant areas of uncertainty in the LGA claim. For example, the pressure to spend £68m extra in street cleansing, where they have admitted that it was difficult to quantify costs," the ODPM said in a statement. It added that this was a bargaining tactic by the LGA and that most figures contained in the report did not come from commissioned surveys.
Posted
on : Thu, 03 Nov 2005 08:40 GMT | Debt News
By : Paula Jenkins
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