Labour councillors have set themselves on a collision course with Tory ministers after agreeing to raise council tax by the most possible without triggering a referendum.
This week Communities Secretary Eric Pickles challenged Durham County Council to avoid tax hikes and protect frontline services by selling off its £62m of “surplus assets”.
Hours later, the authority’s cabinet ignored the suggestion and backed a 1.99 per cent council tax rise – just under the two per cent that would have prompted a local referendum.
Assuming a full council meeting rubberstamps the proposal later this month , that will mean Band A householders, 59 per cent of those in County Durham, having to pay 33p a week extra for their council services in 2015-16.
The Government has offered Durham a grant worth £2.18m if it freezes council tax, but that would still leave a £1.2m shortfall from the £3.398m the tax hike is expected to generate – at a time when the cash-strapped council faces unprecedented cuts of £250m, including £16.3m over the next year.
Deputy leader Alan Napier said raising council tax had been a very difficult decision to take at a time of national austerity, pay squeezes and when household budgets are under pressure.
“This is a sensible and prudent budget. We are protecting frontline services as best we can,” he said.
The council only learned how much money it will get from central government last Wednesday (February 4).
The final settlement brought some unexpected good news – an extra £966,000 for welfare help and social care. But Cllr Napier said this was still £1m less than for this year.
The overall revenue budget totals £409.9m. A capital programme of £366m to 2017 is also included, with £93m for building new and improving existing schools, £101m for maintaining and improving roads, £18m for broadband, £14m for industrial estates and £8m for town centres.
Councillors would see no increase in their allowance and their mileage rate cut to 45p.
By next March, the council expects to have cut 1,950 jobs from its 2010 workforce.
Council house and garage rents are set to increase by an average of 2.2 per cent.
Labour wants to continue its pioneering Local Council Tax Support Scheme, meaning no working-age council tax benefit claimant has their payment reduced.
Conservative and Liberal Democrat groups want council tax frozen. Final decisions will be made on Wednesday, February 25.
Source – Durham Times, 12 Feb 2015