Low council tax and costs should be the norm, says Neill

5 Oct 10
The Equality and Human Rights Commission has released a practical guide to help ensure public bodies are transparent and fair when making decisions over spending.

By Lucy Phillips

6 October 2010

The local government minister has pledged to resolve the ‘broken’ local government finance system.

Speaking at a fringe event at the Conservative Party conference yesterday, Bob Neill said cutting spending while keeping council tax low will involve a ‘remorseless bearing down on costs’.

He praised as examples the ‘good practice’ displayed by three Tory council leaders, also speaking at the event. The government wanted to make this ‘the norm rather than the exception’, Neill said.

David Burbage, leader of Windsor & Maidenhead Council, which this year cut its council tax by 4%, put its success down to incentive-based recycling; being the first council to publish all payments over £500; and making low council tax part of the chief executive’s salary incentive scheme. This came alongside ‘salami slicing’ budgets, outsourcing, using more shared services, ‘smarter’ procurement and an organisation restructure.

Stephen Greenhalgh, leader of the London Borough of Hammersmith & Fulham, told the meeting that keeping local taxes low ‘falls down to getting control of the cash and finding a language that resonates with those in the public sector’.

Wandsworth is another London borough where council tax has remained low. Leader Edward Lister said councils should not be doing ‘things that don’t matter to residents’. Such activities should be offloaded to the voluntary or private sector. ‘Let us sweep streets, we are good at that. Let’s keep away from some of the other things and find other people,’ he said.

But a delegate from Cotswold District Council said there was ‘an elephant in the room’, namely the Local Government Pensions Scheme. Describing how almost £1 out of every £4 of council tax went into the scheme in his authority, he said: ‘That makes it very difficult in setting forward budgets. We can save money on every service but then every year comes a bid for growth and that’s for the Local Government Pensions Scheme.’

Greenhalgh agreed that ‘there’s a huge pension fund liability out there’, adding: ‘We have got to get a new settlement that we can afford.’  

The coalition is committed to a council tax freeze for 2011/12 and, according to Neill, will ‘work to see if it can be done the following year too’. He added: ‘Council tax doubled under Labour, it became the ultimate stealth tax. It has become unsustainable for a lot of families.’

Neill also revealed to delegates that the Localism Bill was likely to be published in the latter half of November and that next year’s review of local government finance would be an ‘update’ of the Lyons’ review, not simply a repeat of it.

‘And we will make a blooming decision,’ he added.

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