Government could allow Kent councils to increase tax to cover funding gaps
Some could see increases of up to ten percent, according to national reports, as part of new reforms
The government is reportedly considering plans to allow major local authorities, including those in Kent, to double council tax increases in order to address funding gaps caused by forthcoming reforms.
According to reports in the i newspaper, the policy could permit council tax hikes of up to 10%, compared to the current limit of 4.9%, for councils significantly affected by changes to local government funding.
Details of the proposal are not expected to be revealed until after next week’s Budget statement.
Kent County Council’s cabinet member for finance, Cllr Brian Collins, said he had not been made aware of any such proposals.
“It’s news to me,” Cllr Collins said. “Raising council tax is not going to be attractive to anyone. It’s another tool in the toolbox – doesn’t mean to say we want to do it and I would want to see the details.”
Currently, councils can only exceed the existing 4.9% council tax cap if they are near bankruptcy and gain government approval or the support of a public referendum.
Part of a wider funding reform plan
The reported plans are part of a broader strategy by the Ministry for Housing, Communities and Local Government (MHCLG) to overhaul local government funding.
The changes are expected to help manage financial shortfalls through “funding floors” and a phased implementation process spanning three years.
In Kent, the reforms are tied to Local Government Reorganisation (LGR), which would see the abolition of all 14 councils in the county, including Kent County Council and Medway Council, to be replaced by a smaller number of larger unitary authorities.
Kent County Council has previously raised concerns about receiving insufficient funding from the government, particularly regarding rising costs in areas such as adult social care.
Calls for fairer funding
Former KCC leader Roger Gough had called for multi-year financial settlements to allow the council to plan for the future.
Nationally, London councils are expected to be among the worst affected by the reforms.
London Mayor Sadiq Khan has urged the government to consider the capital’s high housing and living costs when designing new funding formulas.
Minister for Local Government Alison McGovern highlighted the government’s aim to create a fairer funding model, saying £47 billion would be provided over three years, with 30 existing funding streams condensed into five.
“It’s simply wrong that where you live determines the quality of services you get and ultimately determines your life – from birth to old age,” McGovern said.
“These reforms end that injustice. By using up-to-date data and targeting funding to areas with greatest need, we’re reversing years of unfairness and unlocking opportunity in every part of the country.”