Residents in Northampton can expect maximum increases in their council tax for the remainder of the borough council’s existence.
Northampton Borough Council’s cabinet has agreed to the principle of the council tax rise as it looks to plug gaps from further reduced funding from government.
The council’s Medium Term Financial Plan (MTFP), which was adopted by cabinet on Wednesday (October 17) sets out ‘principles’ that will underpin financial decisions for the next five years - though the council is likely to be abolished in 2020 for a new unitary authority for the west of the county.
Council Tax was frozen from 2011/12 until 2016/17, but in 2018/19 it was increased by 2.99 per cent per year for a band D property, and this is the annual increase incorporated into this strategy. It is the maximum allowed without triggering a referendum.
Currently a band D property in an unparished area of Northampton pays £1,678.61 per year. A 2.99 per cent increase would see this rise by £50.20 to £1,728.81 in 2019/20.
The MTFP also reveals that NBC needs to make savings over the next five years of £3.4m by 2022/23, with £1.9m required in 2019/20.
Councillor Danielle Stone, the Labour leader of the opposition, said: “This is not a savings requirement, it’s a budget gap and we should call it what it is.
“I understand the need to set council tax for the maximum, but people will see that they are paying more for less services. I think we need to think about raising awareness so people can be educated on what their council tax is spent on and who does what with it.”
Cabinet member for finance, Councillor Brandon Eldred, said that the ‘majority’ of the council’s money was going on the environmental contract so ‘people can feel proud of the town’, and on tackling homelessness.
Government funding to the council has reduced from a total of over £16m in 2014/15 to around £11m projected for 2019/20. Over that period, Revenue Support Grant has also reduced from £6.1m to nothing at all.
Cabinet papers added: “Under the four-year funding deal, funding is fixed until 2019/20. The position beyond this is unknown and will be determined by both the current review of funding formulae and the nature of a new unitary authority. The current forecasts are based on prudent assumptions of the funding that would be available to NBC in its current form.”