Council tax to rise by 3.5%

Council tax will rise by an average of 3.5 per cent from April, a new survey by the Local Government Association (LGA) has found.

This is below the rate of inflation, which is at 4.4 per cent according to the retail price index (RPI), and well below the government’s cap of a five per cent increase.

However, a breakdown of the figures reveals that although the majority of district councils are keeping their tax hikes down, many county councils are planning rises of 4.9 or five per cent – the maximum they are allowed without being penalised.

LGA chairman Sandy Bruce-Lockhart said county councils, which have responsibility for providing care for the elderly, are facing increasing pressure from an ageing population and were struggling to manage with the money granted to them by the government.

Citing a new LGA report on elderly care, he warned that by 2009-10, these pressures could see care withdrawn from up to 370,000 older people.

“Almost seven out of ten authorities can now only afford to provide care to people with the most substantial and critical needs,” Lord Bruce-Lockhart said.

“People have to wait until their life is threatened, they have serious mental and physical illness, or they are unable to carry out the majority of personal care or domestic routines.

“If the chancellor is not prepared to pay for providing the type of care the vast majority of people expect, then the government must be honest about what it is prepared to fund, the impact this will have on local services and the burden it is choosing to shift onto council tax payers.”

Local government minister Phil Woolas said he recognised the pressures posed by an ageing population “not just upon councils but upon central government as well”, and said action was being taken to allow authorities to share budgets for health and social care.

“But you know there’s always demand above what the taxpayer can pay and it’s a question of getting the balance right and I think we’ve got that about right,” he told BBC News 24.

Mr Woolas added that councils “do need congratulating” as they had met their efficiency targets and kept tax hikes down – praise which was echoed by Lord Bruce-Lockhart.

However, Help the Aged policy officer Anna Pearson warned that many pensioners would still find it hard to deal with the council tax rises, saying spending more than ten per cent of their household expenditure on town hall bills was “not sustainable”.

She called for local authorities to promote the council tax benefits that were available, but added that they must also ensure care and home help services were “protected at all costs and not squeezed by the threat of central government capping”.