CLASH OVER ‘RECKLESS’ BID TO KEEP COUNCIL TAX HIKE TO 5%:
...BUT CABINET MEMBER SLAMS ‘RECKLESS’CALL TO USE RESERVES
APLANNED 9.5% council tax rise could be averted for Anglesey ratepayers if passed by councillors.
That’s the claim made by the main opposition group who say they will be presenting an alternative budget that would see bills rise by 5% instead.
But the proposals have come under attack from one cabinet member who described the plans as “reckless” and “could push the authority towards bankruptcy.”
The Annibynnwyr Môn group, which holds seven of the 30 seats, say the smaller tax rise can be achieved by deleting the post of deputy chief executive and reducing the number of portfolio holders from nine to seven.
One of the two existing deputies, Caroline Turner, has already accepted a new role as chief executive of Powys Council: not filling her position, members say, would release £86,708 a year. The group would also take £1m out of the authority’s allocated reserves and delay plans for a temporary travellers and gypsy site at Star, which was given planning permission last year.
In a controversial measure, despite a warning from the authority’s finance officer that reserves are already “critically low”, the group say they would take another £565,000 out of the general balances.
Cllr Aled Morris Jones said: “Asking people to pay a 9.5% increase is just too much. People’s wages are not rising at anywhere near such a level, if at all, and we simply must find other ways of making up the shortfall.”
Cllr Morris Jones added that their group would also keep the holiday and second home premium at 25% rather than the proposed 35% and retain the empty home premium at 25% rather than the 100% earmarked in the Executive’s proposed budget.
If the group manages to persuade a majority of members to accept their proposals, council tax bills for the average household on the island would rise by £57.15 a year rather than the £108.36 proposed by the ruling group.
On Monday the executive discussed a letter from the Auditor General for Wales who warned the council needed to replenish reserves as the current level represented “a threat”.
Marc Jones, the 151 [finance] officer, added that having reached “a critical point” these reserves should not be allowed to fall any further and would have to be restored to a minimum figure of £6.7m over the coming years – meaning the council would have to prepare for budget surpluses. However, this was acknowledged as being mainly the result of the growing costs of “demand-led” services, such as children and adult services and a slashing in successive government block grants, resulting in the authority having to dip into its reserves to fund a projected overspend of £1.59m for the current financial year.
Reserves could be as low as £3.6m by April despite standing at £8.9m just three years ago.
Last month the scrutiny committee recommended a council tax rise of above the initial proposal of 6% to avoid massive school budget cuts.
In response the finance portfolio holder, Cllr Robin Williams, said: “In view of the Wales Audit Office recent written comments about our reserves, raiding them again at this time would be reckless and could push the council to the brink of bankruptcy.
“The council tax increase I recommended to the executive on Monday is the prudent option in the face of the continued effects of austerity, and even after this increase we will still have the second lowest council tax bills in north Wales.”
A decision is expected when the full council meets today, Wednesday.