Luton Council plans 4.95% tax hike

Town hall
Town hall

Luton residents are facing a 4.95% council tax hike, a 1% increase on last year.

Luton Council’s budget for 2017/18 will be set at a meeting of the Full Council on Monday 20 February. Proposals moved by Cllr Andy Malcolm, Portfolio Holder for finance, were supported by Members of the Executive last night.

It means the council will levy a 1.95% rise with an additional 3% for adult social care.

The proposed budget includes new measures to further support economic and employment growth while protecting vital services and also meeting the challenging savings targets made necessary in the Government’s ongoing deficit reduction programme.

Since 2013/14 the amount of Revenue Support Grant that Luton Council receives from the Government has reduced by 67 per cent, and the Council is expecting further reductions in its core funding totalling £10m over the next two years, bringing the total reduction to 83 per cent by 2019/20.

The report identifies significant savings and income growth of £8.9m, alongside a 1.95 per cent increase in the Council’s share of the council tax precept.

The Government has additionally allowed the Council to set a three per cent precept – worth around £1.93m – which is ring-fenced for adult social care and will be used to help fund increasing costs arising from looking after vulnerable people and the national living wage.

Significant new funding from the Council for the Luton Investment Framework will total £2.9m over the next three years, and includes investments of:

>£1.3m to support work skills development in Luton

>£600,000 for a ‘Citizen Shop’ to provide employment and training advice in the town centre

>£400,000 for additional business development and planning staff

>£200,000 to improve the town centre.

Assuming that the Bedfordshire Police and Fire Authorities both increase their precepts by 1.99 per cent, the increase in council tax (including social care precept) would be equivalent to an additional £1.03 per week for band B properties.

Cllr Malcolm said: “I am pleased to recommend this budget which is further proof of the Council’s ongoing determination to improve life chances and outcomes for the people of Luton, despite ongoing national austerity.

“The level of reduction in core Government funding remains significant and ongoing. This is a fundamental challenge for Luton and, together with increasing demand for key services such as children’s and adults’ social care and homelessness, is the reason why substantial savings continue to be needed.

“Nonetheless, through the Luton Investment Framework, the Council continues to forge a way forward to secure the economic prosperity of our town.”

The Council is faced with unavoidable growth pressures totalling £9.3m, as a result of demographic changes, the national living wage, pension and pay awards. The Government has also reduced Luton’s public health grant by £400,000.

Cllr Malcolm said: “Luton has a strong track record from saving £99m over the last six years with the minimum possible impact on vital services, and this year’s budget proposals seek to build on that achievement.

“The local skills agenda is critical. The investment outlined in this budget seeks to ensure that jobs created in Luton go to Luton people, so our residents can prosper and lead safe and healthy lives.”

The proposals would again enable Luton to set the lowest council tax in Bedfordshire, say the council, and would keep band D bills around 17 per cent below the national average for similar unitary authorities.

Cllr Malcolm said: “This budget proposes prudent measures that protect vital service levels to the public and the most vulnerable in our community. They also put us in a position to ensure Luton’s financial viability as we continue to navigate these challenging times.

“Key to our vision for Luton’s prosperity is how income growth from business rates and the airport can be achieved. As part of this, the Council is working closely with SEMLEP to start the development of the London Luton Airport Enterprise Zone, which is expected to create more than 7,200 direct and skilled job opportunities for local people.”

The planned hike would be the 18th time in 19 years the precept has gone up.

Since 1998-99 LBC has increased its council tax charges 16 times and has frozen them just twice (in 2004-05 and 2011-12)