Council tax to rise in Richmond due to ‘massive cuts’ in Government funding

Councils all over the country are facing hikes due to cuts in central Government grant funding- on average 40 per cent since 2010.

The Richmond Conservative party froze council tax after coming into power in 2010 until last year when it went up for the first time. This year’s rise is significant as it includes a social precept of 2 per cent.

The council’s strategic cabinet member for finance and performance, Councillor Stephen Speak, said “circumstances eventually catch up” and that the rise is necessary to “protect services”.

He said: “We froze council tax, in that time inflation has been increasing the cost of the council in terms of providing services.

“We have kept it down to the maximum that we can for as long as we can.

“But circumstances eventually catch up, we have to pay the staff more, the cost of services and materials is increasing.

“These things do come round and they have to be paid for.”

More than half of the funds collected will go children services and adult care.

The council has calculated that a total of £151.526 needs to be raised to meet demand.

This pot will be divided into education and children’s services (34.8 million), environment (18.5 million), chief executive’s office (3.9 million), housing (5.6 million) and adult community services (52.6 million).

The Richmond element has increased by 1.99 per cent, social precept accounts for a 2 per cent rise, and the Greater London Authority precept is increasing by 5.07 per cent- this results in a rise from last year’s £1,638.54 to £1,706.94 for a Band D property (rise of £68.4).

Richmond Council has experienced a 66 per cent reduction in funds since 2010.

Cllr Speak, said the council has been “penalised for having wealthy residents”.

He said: “Richmond is the worst funded council in London and has the lowest funding per head than in any London borough.

“They think we can pay for it- we already have a high council tax rate and the view is that we have the ability to support that.”

However, he said although public services are “bearing the brunt” of the cuts, the Government “has got to bring borrowing down”.

Cllr Speak said: “That is vitally important.

“The share of our borrowing is really very high and that means interests costs are very high- we’re paying an awful lot of money as a country to live beyond our means.”

The Local Government Association has warned that gaps in funding cannot be met through council tax rises and that local services will suffer as a result.

Cllr Speak said services will “not necessarily be cut” but “delivered in a different way”.

While the council has statuary requirements when it comes to children and adult social care for example, other services are not obligatory.

For example, a community hub “could be merged with a library”.

Since 2011, the council has shaved £56 off the budget, but a further £20 million needs to be found by 2021.

To bring down costs in the future, the council intends to increase efficiency through its digital strategy.

Cllr speak said: “Using digital technologies we can squeeze out some of the costs we have at the moment- that’s a big ambition that we have.”

He “couldn’t say” whether council tax will go up again next year but that it was “always a possibility”.

The Government has promised to hold a consultation on the negative revenue support grant in spring, where a council ends up paying more to central Government than it gets back.

Cllr Speak said: “We’ll hopefully have those discussions soon, get some money back and hold those taxes down.”

He referred to a recent residents’ survey and said “despite the intense pressure on our budgets…I am pleased that 87 per cent of people are satisfied with how we are performing” adding “70 per cent of people recognise that we are providing value for money”.

Leader of the Lib Dem opposition, Gareth Roberts, has “welcomed” the rise.

He said: “The Tories finally agree with the Liberal Democrats that there is a need to raise council tax to protect services.

“That is to be welcomed.

“It's a shame it has taken them this long to get round to recognising the fact.

“Instead they've opted time and again to try to make the books balance by hitting the poor with inflation busting charges while maxing out the borough's credit card.”

Cllr Speak responded: “The Lib Dems on the Budget Scrutiny Panel last week voted to raise the council tax by a further percentage point, but without any plans for spending that extra income.

“Conservatives will seek to keep council taxes low while protecting services and we simply won’t agree with the Lib Dems that the council should take more money from residents’ just because we could.”

The Budget meeting will take place on March 6.