Proposed council tax increase reduced

Council tax in Shropshire is proposed to rise by 3.99% from April 2021 – a 1% lower increase than the council had originally envisaged.

The proposal will go a meeting of Full Council on Thursday 25 February 2021 where the budget for 2021/22 will be set. For the proposal click here.

The Government’s calculations of ‘council spending power’ assume that Shropshire would increase council tax by 4.99% in 2021/22, made up of a 1.99% rise in general council tax and a 3% adult social care precept – extra council tax funding ring-fenced to support adult social care.

However, councils can choose to implement the adult social care precept over a longer period rather than all in one year, as many councils are planning to do.

Councils’ scope to increase funding for services such as social care, where costs and demand continue to rise, is very limited, as in recent years Government funding has reduced, forcing councils to rely more on local funding through council tax to maintain services. Social care, for example, now accounts for 64% of the Council’s budget. Five years ago it was 43%.

The Government is to address this through its delayed Fair Funding review, which is now due in 2022.

Council Leader Peter Nutting has requested that the 4.99% council tax rise initially proposed is now reduced to 3.99%, which includes a 2% adult social care precept.

A one-off £1.6m shortfall created by deferring the full adult social care precept would be funded from reserves, with the outstanding 1% adult social care precept added to council tax bills in 2022/23.

The proposed 3.99% increase in council tax would add an extra 83p per week for the average Band D Shropshire home’s bill.

Peter Nutting said:-

“This approach will generate an extra £3.2 million in the next year ringfenced for adult social care – a key area for Shropshire due to an ever-growing ageing population needs continued support and investment.

“This would fund the equivalent of an extra 77 new beds in a nursing home for a year, or provide 150 more people with the average 21 hours a week home care support they need.

“However, we recognise that due to the pandemic, many people are finding times very tough financially. This proposal will spread the increase the Government expects we will make over a longer time, providing some help on the pressure many will feel due to rising household bills, including council tax.

“If anyone is facing real financial hardship, particularly due to the pandemic, I would urge them to contact the council, as there is some help that may be available, either via www.shropshire.gov.uk/coronavirus or on 0345 678 9078.”