Do you think your council tax should go up?
You might have to answer this question over the next few weeks if your local council believes it needs to raise council tax by more than 2%. But I suspect that it won’t do this because it fears what you would say.
In 2010 the Coalition agreed that council tax should be kept down unless local people agree to a rise. So councils now receive the equivalent of a 1% rise in council tax from government in return for freezing council tax and most have opted to take this additional money. These include Gateshead where the council receives around £800,000 from government in this way.
However if councils choose to raise council tax they don’t get a penny of this addition. Should they raise council tax by 1%-2% they would be robbing Peter (that’s you) to pay Paul (that’s the government). And if they want to raise council tax by 2% or more they need to have a local referendum to authorise it. That’s where you would get to say whether you wanted your council tax to go up to fund local services.
Over the next few weeks you will hear much about the cuts because this is the time of year when councils agree their budgets. Before last year’s annual budget meeting many of Gateshead’s Labour councillors posed for photograph with trade union activists and other campaigners outside the Civic Centre. They were protesting against the very budget that they then went in and voted for. But this level of hypocrisy is only the start.
Over the next few weeks you can expect to hear Labour council leaders bemoaning the unfairness of government cuts and here in the North East councils have suffered more than most, although not all, regions. The reason of course is that councils in poorer areas like ours receive far more per head from government so when cuts are imposed we are hit hardest. Indeed government as a whole spends more per person in the North East than in other parts of England; which is why we feel the cuts more keenly.
Back in 2010 public expenditure as a whole was £10,126 per head in the North East, the highest of any English region outside London; by contrast people in the South East had £7,970 per head spent on them; some 21% less per person. By 2013, expenditure in our region had indeed been cut to £9,419 per person and the South East had been cut to £7,638 (House of Commons Library figures). The gap had closed to 19% but the relative position remain unchanged – the government still spends more on people in the North East than anywhere else in England outside London.
What Labour will not tell you however is that their councils have chosen not to ask you for more money. This is in some ways surprising given Labour’s values and history.
Council tax is after all a progressive tax; people in more expensive houses pay more – so for socialists it should be eminently appropriate to use this tax to help people who don’t have such resources.
Indeed under previous non-Labour governments this is just what they have done. Back in the 1990s Gateshead’s Labour Council raised council tax by as much as 13% in a single year. But of course back then they did not have to have a referendum to authorise it.
Today, instead of having a referendum and making the case for council tax rises, Labour councillors would rather complain about the cuts and accept a freeze in council tax.
So when Labour canvassers knock on your door or telephone to ask for your vote my advice would be to ask them why they don’t have the courage of their convictions? If the cuts are so awful why are their councils not asking people for the money to stop the cuts?
Labour’s other option is to raise taxes by below the level that triggers a referendum, that is, by between 1 and 2%. But this would require them to ask council tax payers to give them money they could have got for free from government; to ask for a rise that makes no economic sense at all. It would be to add duplicity to cowardice. Will Labour do this? Over the next few weeks we’ll find out.
Ron Beadle is a Liberal Democrat Councillor for Low Fell.