Homes in the East Riding face 4.99% tax increase
BUDGET SHORTFALLS EXPECTED AND SERVICES MAY BE CUT BACK
EAST Riding households could be hit with 4.99 per cent rise in council tax if draft budget plans are approved.
East Riding Council is aiming to raise an additional roughly £7.5m through the hikes, with finance officers warning budget gaps could grow to £44.4m by 2024-25 without continued increases.
But the draft budget stated there would still be a £9.6m hole by the middle of this decade with the proposed increase and 3.99 per cent hikes every year afterwards.
The draft showed council tax bill increases would range from £49.98 for Band A households, to £74.97 for Band D and £149.93 for Band H if they are approved.
The planned hikes come as a report warned “significant” cuts to services would be needed without the increase despite £10.6m saved and £2.4m taken from reserves this financial year.
They also come as the East Riding’s council tax base, the estimate of the amount of Band D households shrank from 118,159.6 this year to 117,313.3, falling for the first time in seven years.
Council finance lead Julian Neilson wrote in East Riding’s Financial Plan earnings from sales, fees and charges had fallen at a time when spending rose to tackle the effects of the coronavirus pandemic.
The head of finance stated: “The council, as with other local authorities, have and will continue to have a significant role to play in the response to coronavirus.
“Not withstanding the ongoing devastating impact of the pandemic, local government continues to grapple with a mountain of other monumental challenges including ongoing economic uncertainty, significant levels of growth in the demand for adults and children’s social care and the UK’S departure from the EU to name but a few.
“These challenges follow a decade during which local authority funding has reduced while demand for services has risen.”
The council is set to receive around £58.1m in central government funding, up by £27,000 compared to the last financial year.
The draft budget stated the amount would only cover a year as the Government’s Fair Funding scheme for councils remains on hold due to coronavirus.
It added government calculations for councils’ share of funding assumed they would ask for the maximum increase in household levies below the 5 per cent trigger for a referendum.
Finance officers have also budgeted for 75 per cent council tax discount claims which rose by around 1,700, or 18 per cent, due to the pandemic.
The Financial Plan stated the council would balance its budget in 2021-22 if recommendations are adopted, but that would still leave the £9.6m gap going forward.