Band D council tax likely to rise over £2,000 next April
25 November, 2022 12:00 am
2 Min Read
The council’s predicted budget gap is currently £10million By Local Democracy Reporter Josh Mellor
Council tax for band D properties in Waltham Forest will likely rise above £2,000 next April as the council struggles to close its £14million budget gap.
Last week, chancellor Jeremy Hunt announced councils can now increase their portion of the tax by up to 4.99% without a referendum, whereas previously the limit was 2.99%.
While the increase must be approved by the full council, corporate director of financial services Ursula Gamble told councillors this week that the announcement meant this year’s predicted funding gap had dropped to £10m.
Speaking to a budget scrutiny committee on 22nd November, she said: “I think that, eventually, the gap probably isn’t as horrific a picture as it could have been.”
In Waltham Forest, an increase of five per cent would equal an extra £77.22 per year to residents in band D homes, raising their total bill to £2017.16.
Council housing residents may also face a rent hike of up to seven per cent depending on the council’s final budget decision in February next year.
A seven per cent increase to a two-bed council home in Waltham Forest, currently costing £438.56 a month, would represent an extra £30.68.
To close the £10m budget gap the council has already drawn up plans to make £7m in “savings”, although it has not confirmed which services would be affected.
Although the council is not likely to face any cuts in government funding compared to last year, the government is also unlikely to give extra funding for increased costs of social care and inflation.
Government funding represents more than half of Waltham Forest’s £444m annual budget.
Ursula added: “The autumn statement covered a lot of things, but it kicked a lot of things down the road as well.”
Additional budget challenges to the council include a likely delay to a review of the way councils are funded until 2025/26, five years later than originally planned.
As in previous years, the government’s funding settlement is likely to only cover next year, meaning it is more difficult to make longer-term financial plans.
According to a report before the committee, the council’s reserves of £114m are the 19th lowest of London’s 32 boroughs.
A “stress test” carried out by local government association London Councils suggests that boroughs in the capital are likely to face annual funding gaps of £10-50m for the next two years.