Union warns accepting council tax freeze will leave financial black hole
The union fears the government is attempting to ‘bribe’ councils to accept the freeze in return for a totally inadequate 1% payment that will leave local councils with a black hole in their finances.
Earlier this week the Chancellor offered councils a grant equal to a 1% increase in their council tax if they agreed to freeze their council taxes in 2013/14.
UNISONs head of local government Heather Wakefield said: “The government is plunging councils into further economic meltdown. Offering a 1% ‘bribe’ to freeze council tax will leave a financial black hole that can only be filled by cutting more jobs and vital services. It is a bad deal for council taxpayers who are losing quality services and cuts to everything from elderly care to libraries, children’s services and swimming pools.
“It shows the wisdom of councils like Peterborough, Surrey and East Cambridgeshire who rejected the freeze grant last year because they wanted more control over their finances”.
Next year councils in England already face the loss of nearly £2 billion, plus inflation of around 3% and budget pressures from a growing elderly population.
Councils that agreed to freeze their council taxes this year (2012/13) were given a grant that was equivalent to a 2.5% increase instead. But it is a one-off payment and it disappears in 2013/14.
So the first call on any extra income will be to fill the gap created by the loss of council tax freeze grant (2012/13)
For example Kent County Council has to find £14.448m to cover the grant. If it freezes council tax again in 2013/14 it will only get £5.779m – it will need cuts of £8.669m simply to fill the gap.
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