Millions face council tax rise of more than 5% after government gives green light to bigger hikes
More than two million people will be hit by increases of between 5 and 10%.
Windsor and Maidenhead Council wanted to increase council tax by 25% but the plan was blocked – instead it will go up by 9%.
Newham Council will go up by the same amount, while Bradford Council will put up taxes by 10% and Birmingham, Somerset and Trafford councils will all put up rates by 7.5%.
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Speaking to Sky News’ Kay Burley, health and social care minister Karin Smyth defended the above normal increases – saying “many more councils” asked for permission to hike taxes, but were refused.
She said the ones given the nod “are particularly desperate” and need the money to keep “basic services running”.
The Labour MP was quick to blame the Conservatives, saying local government was left in a “really, really dark state” by the previous government.
How do councils increase tax?
In order to keep up with demands, councils are allowed to raise council tax usually by up to 5%, broken down into 3% core spending with an additional 2% for social care.
At the moment, a principle exists which prevents more than a 5% increase to council tax without a referendum, mostly to protect taxpayers from excessive increases.
But if a council is already in conversation with government on exceptional financial support, and if the government agrees to allow the council to raise tax above the cap as part of this, the council doesn’t necessarily have to take that to a local public vote.
Deputy prime minister Angela Rayner – who is also the secretary of state for local government – confirmed the move on Monday.
She said the average council tax increase across the country would not surpass last year’s total of 5.1%.
She also said more than £69bn in central funding would be made available to regional administrators, a rise of 6.8% compared to the 2024-25 period. Close to £4bn has also been put aside to help councils with social care.
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The Conservatives accused Labour of “pushing the burden on to taxpayers after they promised to freeze council tax”.
Shadow communities secretary Kevin Hollinrake said: “Their Local Government Finance Settlement will mean that councils will have to raise council tax to accommodate Labour’s jobs tax.
“This means that local people will pay more for less when it comes to local services, especially in rural areas which are losing the Rural Services Delivery Grant that Labour have abolished.
“The Labour Party have made false promises to local people, promising to freeze council tax while many councils will now have to raise it due to Labour’s political choice to raise council tax.”
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The County Councils Network, which represents 37 administrations, said they are facing pressure from the government’s decisions to increase national insurance contributions for employers, and increases to minimum wage.
Barry Lewis, the network’s finance spokesperson said: “More than four in five CCN members say they are in a worse position than before the autumn budget and this finance settlement, and one-third say their service reductions next year will now be severe.
“Considering there is very little fat left to cut from many of these services already, a further reduction will have a material impact on our residents.”
Ms Rayner confirmed allocations worth £502m to assist councils with the impact of increases to employer national insurance contributions.
