Local authorities split on taking council tax freeze grant

28-02-2013

CIPFA’s annual survey shows that currently 41% of councils in England plan to forego the 1% freeze grant offered by the Department of Communities and Local Government and raise council tax for 2013/14. This is significantly up from the 15% of authorities who did not take up the grant last year.

Based on the survey, amongst those authorities foregoing the grant, Council tax increases are likely to average 1.1%. Since 59% of councils across England will take the freeze grant, the overall average band D Council Tax bill looks set to rise by 0.8%, the equivalent of £11.74. This increase compares with last year’s average rise of 0.3%.

The survey shows considerable variation between regions. The largest increase for a band D Council Tax bill will be in Yorkshire and Humber where it is projected to rise on average by 1.2%, the equivalent of £16.30. In Greater London which saw a decrease last year, the average is set to rise by 0.1%.

Ian Carruthers, CIPFA’s Director of Policy, commented,

“Councillors must take council tax decisions based on local priorities. As the pressures from this period of unprecedented austerity intensify, all councils are having to strike an increasingly difficult balance between protecting hard-pressed taxpayers and maintaining local services.

The imminent changes to local authority funding systems are bringing added uncertainty to councils’ financial management and making it more difficult than ever for councillors to take the medium and longer term decisions required.”

 

ENDS

Contact: Matthew Patterson

CIPFA Press Office

t 020 7543 5787

e Matthew.Patterson@cipfa.org.uk

Notes to Editors:

  1. CIPFA spokespeople are available this afternoon (Wednesday 27 February) and tomorrow (Thursday 28 February) for comment or interview.
  2. The survey results, upon which this release is based, will be updated regularly on the CIPFA stats website. The site also contains further information to assist in understanding the council tax change: www.cipfastats.net.
  3. The full regional results are here:
  4. GROSSED DATA

    Average Band D Equivalent

    Based on 51% Billing response

    (including Parish / Community)

    26% of billing responders confirmed

     

     

    Percentage

    Total

    Based on 80% Precepting response

     

     

    Increase /

    Increase /

    60% of precepting responders confirmed

    2012/13

    2013/14

    (Decrease)

    (Decrease)

     

    £   p 

    £   p 

    £   p 

     

     

     

    Inner London

       1,112.11

       1,103.03

           (0.8%)

             (9.08)

    Outer London

       1,425.44

       1,428.89

            0.2%

              3.45

    Greater London

       1,304.36

       1,305.45

            0.1%

              1.09

    Metropolitan Districts

       1,400.69

       1,417.66

            1.2%

            16.97

    Unitary Authorities

       1,471.93

       1,486.23

            1.0%

            14.30

    Other Non-Metropolitan Authorities

       1,502.43

       1,509.64

            0.5%

              7.21

    England (excluding London)

       1,471.76

       1,484.44

            0.9%

            12.68

    All England

       1,444.13

       1,455.87

             0.8%

            11.74

     

     

     

    South East (excluding London)

       1,474.60

       1,488.94

            1.0%

            14.34

    Greater London

       1,304.36

       1,305.45

            0.1%

              1.09

    East of England

       1,490.46

       1,500.72

            0.7%

            10.26

    East Midlands

       1,494.99

       1,504.73

            0.7%

              9.74

    North East

       1,525.47

       1,535.09

            0.6%

              9.62

    North West

       1,473.69

       1,488.99

            1.0%

            15.30

    South West

       1,504.21

       1,513.94

            0.6%

              9.73

    West Midlands

       1,419.82

       1,429.82

            0.7%

            10.00

    Yorkshire & the Humber

      1,411.25

    1,427.55

            1.2%

            16.30

     

    Authorities in England that are not taking the freeze grant

     

    1,469.78

     

    1,485.96

     

    1.1%

     

    16.18 

  5. On 8 October 2012 the Chancellor of the Exchequer announced an extra £450 million to help freeze Council Tax bills in England for a further year. The £450 million will be made available through a new grant scheme to local authorities who decide to freeze or reduce their Council Tax in 2013. If they do, councils, police and fire authorities will receive £225 million of funding in both financial years 2013/14 and 2014/15, equivalent to raising their 2012/13 Council Tax by 1%.
  6. For the 2013/14 financial year, billing authorities may not raise their council tax by more than 2% without holding a referendum. The exception to this rule is billing authorities which are in the lowest quartile of council tax in their category (i.e. local authority, fire authority, or Police and Crime Commissioner), which need only hold a referendum if they plan an increase which is over 2% and over £5.00.
  7. These analyses are based on responses received from 51 per cent of billing authorities in England and 80 per cent of precepting authorities.  When all councils have set their budgets, the final outcome is not expected to change significantly.
  8. Rounding errors, which sum to no more than one unit, may occur in the tables.
  9. Full survey results will be available at the end of March.  For advance copies telephone: 0203 117 1840 and ask for “Council Tax Demands & Precepts Statistics 2013/14”. Spreadsheet price £350.00 (+ VAT).
  10. The average council tax demand on a “band D” property comprises three basic elements:

Local demands of the billing authority;

Major precepts (e.g. County Councils, Greater London Authority and Police & Fire Authorities);

Parish / Community Council precepts.