21 Oct 2014

Council's tax freeze is a false economy


St Albans District Council has announced that it intends to freeze Council Tax in April, for the seventh year in a row.

Freezing Council Tax is a popular headline, but it hides a massive, false economy.

A freeze is of course a cut in real terms, as inflation reduces what the Council can get for its money.

The Council currently raises around £10million in Council Tax, out of a budget of around £15million. If they had just allowed Council Tax to keep pace with inflation, they'd now have £2.6million extra to spend on public services every year.

 In other words, they'd have £12.6million instead of £10million - that's a loss of potential income of 20%.

To keep within their shrinking real budget, and balance their books, the Council has been cut, cut, cutting every year. This year they plan another £0.9million in cuts. That's another 6% cut on their £15million budget.

We see the results of cuts all around us, from run-down playground equipment to higher parking fees and lengthy waits to get anything done. Central government is determined to undermine the financial base of local councils by bribing them to cut their real income, and this council is playing along year after year.

It's a great shame and will ultimately cost local people dear.

No comments: