FAMILIES across Northumberland look certain to see their council tax bills frozen for the second year in succession – even though it could result in a £15.6m budget headache in years to come.
County council leaders have decided to accept a Government offer of £3.7m which will allow them to avoid any increase in council tax in the 2012/13 financial year.
The Liberal Democrat administration is backing the freeze despite being warned by finance officers that failing to increase council tax will have a significant impact on services and jobs between now and 2016.
The loss of revenue – if repeated over the next four years – would mean the council having to find an additional £15.6m in budget savings, on top of what is already predicted to be required.
The council’s Lib Dem executive yesterday confirmed that it plans to accept the £3.7m grant from Communities and Local Government Secretary Eric Pickles to freeze council tax this year.
But because the money is a one-off, it means the authority is giving up recurring revenue of about £3.5m a year it would get from a 2.5% council tax rise – consequently storing up deficits for the future.
Councillors have been warned that freezing council tax for the next four years will leave the authority with the shortfall, which will have to be found via extra budget savings.
Across the region councils have been wrestling with the same dilemma. Durham County, Newcastle City and North Tyneside are set to freeze council tax this year and others are still to decide.
Yesterday Andrew Tebbutt, Northumberland’s executive member for corporate resources, said: “All the political parties have concerns about this, and realise it is storing up problems for the future. Unless the Government gives councils a similar grant next year, or consolidates it into the settlement, we will eventually be £15m adrift.”
Labour group leader Grant Davey said the choice between freezing council tax and the need for tougher budget cuts in future years had not been properly explained to people across the county.
“The officers’ reports show a £15.6m black hole in the budget, and that has not been sold to the people of Northumberland. There has not been enough publicity or consultation about this, and we need to hear from people about which of these options they would prefer. Until that happens, our group has not made a decision about this issue.”
Conservative group leader Peter Jackson said: “We are convinced there are still areas of the council’s budget where efficiency savings can be made without affecting the provision of essential services. Until they are made we can’t see any reason why council tax payers should be asked to pay even more than they do now.”
All the political parties have concerns and realise it is storing up problems for the future
