Tax rise won’t plug ‘gaping £100m hole’
BIRMINGHAM City Council has warned that raising council tax bills by six per cent will not solve a crisis in social care funding as it plans cuts of more than £100 million.
The Government is to tell councils they can impose a six per cent increase in council tax bills over the next two years, according to leaked plans. In Birmingham, this will come to £82 for a ‘band D’ home.
And it will come on top of the standard annual council tax increase.
Local Government Secretary Sajid Javid, the Bromsgrove MP, is expected to tell the House of Commons on this week that the increase – known as the social care precept – will help councils deal with a shortage in funding for social care.
But John Clancy, leader of Birmingham City Council, said the measure “won’t do very much to plug a gaping hole in Birmingham’s social care budget, which has been hit hard by six years of Government austerity cuts”.
He said that a two per cent levy on council tax bills raises about £5 million, which would help a little but is “hardly going to be a game changer”.
Coun Clancy said: “The Government’s claim that a social care precept will address the serious and fast-growing crisis in adult social services across the country is disingenuous, at best.
“The gap between demand for social care, fuelled by a growing elderly population, and the amount councils in austerity Britain can afford to spend is vast.”
Government sources said councils will be allowed to add three per cent to council tax bills next year and a further three per cent the year after, as long as the money is spent on social care.
Birmingham MP Jess Phillips said she would be willing to back an increase in the national income tax rate rather than increases in council tax. She said: “People have got to recognise that this is going to cost, and if it’s going to cost people need to pay for it.”
And she pointed out that Buckinghamshire care homes receive £615 a week per resident while those in Birmingham receive a significantly lower sum of £436 a week.
Birmingham City Council has launched a consultation on budget plans which include cutting funding for health and social care services by more than £100 million from 2017-18 to 2020-21.