Let me be open, I have a place in the “City of London” and my partner has a place in Eton which is part of “Windsor and Maidenhead”. Here is the news I am waking up to!
It turns out that City of London and Windsor and Maidenhead are charging below the average for councils around the country and this is not the broad shouldered carrying the load for those up north (anywhere north). Wandsworth, Westminster, Hammersmith and Fulham, City of London, Kensington and Chelsea, and Windsor and Maidenhead will be exempted from rules requiring tax rises of 5 per cent or more to be put to a local referendum.
The government said residents in the councils have had “historically very low bills”.
The exemption, which will start from 2027 and last for two years, gives local leaders “the option of bringing their bills more in line with the rest of the country”, it added. The decision came as ministers announced on Wednesday the allocation of funding to local authorities using a new formula designed to give more weight to deprivation.
Well I’m going “YES in my Back Yards” – both of them. If we have to pay more (presumably a lot more) in our back yards then it’s because of the revelation in this chart.
What this chart shows is that two rich councils (Kensington and Chelsea and Wandsworth are paying below the average in England and others not much more. Going forward, the super rich councils (which don’t all have rough areas like the above two) will be top of the council tax chargers. Westminster will be top (which has bits of rough stuff in its north), the City of London and Wandsworth will cease their long reprieve while the others will all get heavy bills to balance the books with the north.
But of course there are other ways than charging council tax and the FT list a few
Officials said the six councils singled out could fill the gap in ways other than raising council tax, for example by increasing parking charges or dipping into reserves.
Hum – and pensions? I’m not saying that surpluses in LGPS funds that have massive surpluses such as Kensington and Chelsea, should or could be raided. But the aforementioned Chelsea is currently on pension holiday and could continue that – with others joining, to keep the council tax increase down.
I say keeping increase down, the Government’s assumption that goes into the chart is that all councils will put up council tax by the maximum allowable (5%) before going to referendum to agree an increase. So watch out rich boys down south – 5% in 2027 is your starting point for increases.
So who are the likely winners, it’s the boys up north but north includes north London (Enfield) and Luton and even if you’re north of the river (Newham). These along with Manchester is singled out by the FT as beneficiaries per capita resident of the redistribution of wealth announced on Wednesday?
North is a rather loose descriptor!
My conclusion is that the current distribution of council tax and grants to local authorities is quite beyond the comprehension of us council tax payers. The FT gives the last word to a conservative spokesperson.
Sir James Cleverly, the shadow local government secretary, accused ministers of a “nakedly political power grab” that would “hike council tax across the board”. He said the government was “fiddling the funding model to punish councils that keep council tax low and moving funding to badly-run Labour councils that spend irresponsibly.”
That sounds an irresponsible statement to me. What little I know of life outside of Windsor and Maidenhead and the City of London does not suggest this is just about their “efficiencies”; these authorities have the benefit of massive wealth incoming through tourism and through the spending of the very wealthy people who have the good fortune of living in such nice places. We have broad shoulders and should pay.
As for the Local Government Pension Scheme, I hope we’ll see a fair funding review there as well.
