Council tax could soar by £220 claim IFS
Council tax could rise by as much as £220 per year within three years in England, to keep local services operational and fund social care reforms, claim the Institute for Fiscal Studies (IFS) think tank.
The IFS also warned that the rise in National Insurance contributions from next April will not cover the costs of social care.
The government said it had given councils £12 billion since the start of the pandemic, but they continue to face funding gaps.
The IFS argued that the costs of current plans are likely to eventually amount to £5 billion per year, almost triple the amount of funding currently allocated toward it.
Under current government spending schedules, council tax bills would need to increase by a minimum of 3.6% a year to keep services at pre-pandemic levels, the IFS said.
They said this would mean a £160 bill increase by 2024-25, but that other pressures likely to eat into government grants could mean a 5% increase in yearly council tax bills or £220 by 2024-25, is required.
Council services are funded by council tax and topped up by grants from the central government.
Earlier this month the Local Government Association (LGA) claimed an annual increase of £500 to people’s bills would be required to contribute to the extra £8billion required by 2024/25 to keep social care quality at the same level it is at now.
Steve Baker MP responded to the LGA study in The Telegraph last month, saying: “In plain English, expect the state to default on obligations to older people in our lifetimes if we don’t take serious action. And that action simply cannot be ever-higher taxes.”
In light of the new IFS study, he added via Twitter: “😡And the solution isn’t enslaving the young either.”
