By Lauren Howells

Almost all councils in England plan to raise council tax, according to a new survey. 

The State of Local Government Finance Survey 2018, by the Local Government Information Unit thinktank (LGiU), revealed that 95% of councils in England plan to raise council tax and 93% intend to increase fees and charges this year, in areas such as waste, burial/cremation and meals on wheels, in order to “make ends meet”.

Three-quarters of councils said they were planning to increase council tax by more than 2.5%

Three-quarters of councils who responded to the survey said that they would be raising council tax bills by more than 2.5%.

In December 2017, the BBC reported that the biggest councils in England were to be allowed to raise council tax by up to 5.99%.

The State of Local Government Finance Survey also discovered that 68% of councils intend to use their reserves this year.

“…evidence suggests that their 2018/19 budgets will see activity further reduced in several key community services”

According to the report, despite the fact that three quarters of councils had managed “to sustain the quality of the frontline services over the past year”, 2018/2019 budgets could see “activity further reduced in several key community services” including parks and leisure (53% of councils) and adult social care (40%).

A third of England’s councils were represented in the results, with responses received from 113 individual councils.

council tax

Children’s Services now the top immediate pressure

Out of the councils who responded to the survey, Children’s Services was the top immediate pressure, above Adult Social Care for the first time in “at least three years”. The report said that this suggested that councils were “no longer able to shield these services from the worst of the ongoing budget cuts”.

Adult Social Care was found to be the top long-term pressure for councils.

“80% of councils fear for their financial sustainability”

The survey claims that vast majority of the councils who answered the survey (80%) said that they feared for their financial sustainability. 

This follows the news last week that Northamptonshire County Council had warned that its financial situation for 2018-19 was “grave”. At the beginning of February this year, it was revealed that the “struggling” council had banned spending through a section 114 notice. This means that no new expenditure is permitted, other than safeguarding vulnerable people and statutory services.

The BBC said that this was believed to be the first such notice issued in over 20 years.

The council said that the notice had been served

“in light of the severe financial challenge facing the authority and the significant risk that it will not be in a position to deliver a balanced budget by the end of the year”. It added that staff pay would not be affected and the council would “continue to meet its statutory functions”.

The full implications of the notice are due to be addressed at the council’s meeting on 22nd February.

“Councils are on the edge” 

Jonathan Carr-West, Chief Executive of LGiU, said:

“Councils are on the edge. They are for the most part holding services together (though a significant minority are not). But they can only do this by raising council tax, increasing charging and draining their reserves.

“The system is unsustainable and needs far more fundamental reform than is presently on offer. It’s simply not acceptable that we don’t know how local government will work post-2020. Councils are calling for assurances around funding for the next three years and for a fundamental redesign of the finance system. At present government is offering neither. That has to change”.