Cash strapped local authority backs council tax rise

Nicholas Thomas – Local democracy reporter

Senior councillors at a cash strapped local authority have backed new budget proposals they say will protect key services and clean up the county borough – while also including a council tax rise.

Cabinet members for Caerphilly County Borough Council met on Monday January 12 to agree to a public consultation on the proposals, which will begin later this month.

Opposition councillors have criticised plans to increase council tax rates by a proposed 6.25%, adding £97 to the annual bill for residents in average Band D properties.

Cllr Jamie Pritchard, the council leader, said the authority had “learned” from previous years and avoided proposing controversial cuts to public services.

But he urged residents to remember the range of services the council provides “has got to be paid for”.

Previously, Plaid Cymru group leader Cllr Charlotte Bishop said the proposed rise in council tax “during a cost-of-living crisis feels deeply unfair, particularly when residents will see no real benefit in return”.

Independent group leader Cllr Nigel Dix warned he would not support a council tax increase, and urged the Labour cabinet to negotiate a better deal with party colleagues in government.

At the cabinet meeting, Cllr Eluned Stenner – the cabinet member for finance – said an uplift in Welsh Government funding this year was “welcomed” but fell “significantly below the council’s total cost pressures”.

Currently, officers estimate there will be an £8.4 million funding gap over the next three years.

Council tax makes up 21% of the authority’s income, with the rest coming from central government grants, said Leanne Sykes, the director of finance services.

These income streams cover “a wide range of services from schools and education, social services, leisure centres, roads and highways, waste collection and homelessness,” she explained – adding residents’ final bills will also include charges set by other organisations, such as the fire service and community councils.

The draft budget proposals also include a 3% rise in fees and charges, and a requirement for schools to reduce their budgets by 1%.

Cllr Pritchard said the 3% rise was below current inflation levels, and “I think it’s fair to say we’ve perhaps learned a lesson from previous years when certain charges went up beyond what I think the public was willing to accept”.

He added proposed investment in “cleaning and greening” the county borough “is going to see a real big difference to our communities”.

On schools, senior officer Robert Hartshorn said the proposals for a “1% efficiency target” was “something schools actually model for”.

“We did hold a briefing with headteachers – that went as well as can be expected in the circumstances,” he told the cabinet meeting.

Plaid co-deputy leader Cllr Gary Enright suggested previously the council could dip into “significant usable reserves” rather than increase council tax.

But Cllr Stenner challenged that notion.

“I know it is often stated that this authority has millions of pounds sitting in our reserves, she said. “However, this isn’t the case.

“Having reserves has allowed us to earmark £10 million for fixing the A469 in the Upper Rhymney Valley. Having no reserves would mean that these necessary infrastructure projects would be impossible to do.”

Ms Sykes added: “Reserves need to be thought of the same way as household savings. They are there for emergencies, unexpected costs or one-off investment like large infrastructure improvements. They are not designed to fund everyday services year after year.”

The council has not proposed using any reserves to balance the books in the new budget, and councillors will receive an update on the authority’s reserve balances later in January.