Council tax increase is looming as budget cuts bite

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Council chiefs are warning that tough times are ahead and it will hit householders in the pocket with council tax expected to go up as finance bosses struggle to hack £28million for the budget next year.

The cutbacks will only be necessary if December’s government finance settlement, which sets out how much funding central government gives to local authorities, is agreed.

Herts County Councillor Chris Hayward.

Herts County Councillor Chris Hayward.

The deal drawn up is much worse than bosses at Herts County Council had initially expected.

Proposals to plug the funding gap include increasing council tax by almost four per cent and halving the pot of cash given to councillors to spend on worthy causes to £5,000.

Council Chancellor, deputy leader and cabinet member for resources and performance Chris Hayward has already met with the minister for local government MP Marcus Jones to ask for a ‘fairer’ share for the county.

The settlement proposes to slash government funding by 33 per cent - almost double the amount predicted.

Mr Hayward said: “We fully understand and support government economic policy to lift the country’s finances out of the deficit but we do not believe this settlement is fair. Not only have county councils been asked to find significantly more savings than other parts of the country but also it has not given us time to plan.

“To bridge the funding gap, government has given permission for a social care precept to the value of two per cent of council tax. Considering the demographic pressures on our services, we are seriously considering this. However, this simply isn’t enough to balance our books. Inevitably we will have to make challenging decisions on finding further efficiencies, how we deliver our services, and at this stage we can’t rule out the need to increase council tax.”

Proposals to plug the funding gap have been drawn up and a decision on whether they go ahead will be decided at full council on February 23.

The council tax increase included a basic 1.99 per cent increase plus a further two per cent under George Osborne’s ‘social care’ precept.

Locality budgets given to councillors would be cut from £10,000 to £5,000.

Other ideas being considered including asking the NHS to contribute £2million to social care in the county and £3.5million would be taken out of a highways reserved fund.