Liverpool Council has set out the reasons behind moving toward an almost 5% increase in council tax next year.
Next week, the local authority will confirm its budget for the next financial year, with major cuts to benefits services and One Stop Shops scrapped following a more favourable settlement from national government. As a result, the council is now having to plug a gap of £49m rather than the eye-watering £73m previously feared.
However, it is proposed that when councillors meet to agree the budget next week, they rubber stamp the recommendation to increase council tax for 2023/24 for 4.99% - the maximum increase the city can apply without the need for a referendum. This was made possible by changes brought in by the government earlier this year.
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According to documents made available by the council ahead of its budget meeting next week, the rise will comprise of 3% for its core element and a further almost 2% adult social care precept. It is thought the additional increase will generate an additional recurring amount of £4.2m, bringing the total raised additionally to £10.6m.
Last year, council tax rose by 2.99% and had it done so again on this occasion, would have brought in £6.35m for the local authority.
The report said around two thirds of Liverpool properties that pay council tax are in band A. It said: “Almost 77% are in bands A and B, and 89% are in the lowest three bands (A to C).
“Nationally, the average for England is 24% of properties in band A, 44% in bands A and B, and 66% in bands A to C. An increase of 4.99% in 2023/24 would equate to an additional £61.72 per year (or £1.19 per week) for a Band A property.
“For a band B property, it would equate to £72.01 per year (or £1.38 per week).
The forecast council tax income for 2023/24 based on a 4.99% increase is £223.055m and determines the band D charge to be £1,947.97 for the Liverpool Council element of the bill. The report said there is no legal obligation to consult with the public on the setting of the council tax for a financial year or agreeing the budget.
Liverpool Council can consider setting a lower council tax increase or no increase at all. The report said: “This will require however the reduction in the council’s expenditure to reflect the reduction in estimated income from Council tax collection.”
The budget proposals will be considered by the Cabinet on Friday 24 February before going to the Budget Council meeting on Wednesday 1 March.
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