Corporate, Finance, General

Only sensible option is raising council tax to invest in schools, roads and care at a critical time

CS2510 - Council Tax 2013 infographic

A 1.99% council tax increase would mean residents living in a Band D property paying an extra 44p a week – about the price of a pint of milk. This would pay for all the proposed investment in services.

Raising council tax to invest in schools, roads and care for the vulnerable is the only sensible option and will help boost the economy and support local people at a critical time, according to Surrey County Council’s Leader.

Surrey’s Cabinet will meet next Tuesday (5 February) to consider a proposal to raise council tax for next year by 1.99% to spend on essential services now and avoid crippling the authority’s finances in the future.

It will discuss rejecting the Government’s offer of a freeze because it would lead to a financial black hole of more than £50 million in just five years. That sum is the equivalent to wiping out the council’s roads maintenance budget for about three years.

Surrey’s plan would allow the council to invest an extra:

  • £10m in raising school standards over five years while also providing the 12,000 extra school places the council needs to find
  • £25m in roads over five years to give the local economy a boost when it needs it most
  • £11m in adult social care next year to help people care for their loved ones when more and more are needing support
  • £750,000 in 500 apprenticeships next year to give young people the leg up they need to find work when the job market is so tough and provide employers with the skilled workforce to thrive
  • £250,000 in the Community Improvements Fund to help people enhance their local area.

Leader David Hodge said: “Although this is a difficult decision in the current economic climate, people have consistently told us that roads, schools and care for the vulnerable are what matter to them most. That’s why we want to invest in them now.

 “The Government has offered us a one-off grant if we freeze council tax. Accepting it would be the wrong decision for Surrey as it would cripple our finances for the future. It would saddle us with a £50 million black hole in our budget in just five years and prevent us from investing in services when people need them most.

“The easy option as a politician would be to park the problem until after the election. But it would saddle Surrey with a financial time bomb that would go off in five years time. And that would be an irresponsible decision for us to recommend.”

The council has saved £194m over the past three years. However costs have risen by £201m as a result of an increase in demand for services. 

Over the same period of time, the council’s government grant has gone down by £48m while the extra money brought in by council tax during that time amounts to £37m, leaving a gap of £11m for the county council to fill.

Savings and service deman 2010 - 2014 changes in grants council tax levels

The Cabinet’s recommendation will go forward to a meeting of Surrey’s Full Council on 12 February where a final decision will be taken.

To listen to a podcast of Leader David Hodge explaining why Surrey is recommending councillors back a proposal to increase council tax by 1.99% click below.


Download this clip here: David Hodge – Council Tax 2013


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