Luton Borough Council is set to reject a government grant and increase its council tax precept for the fourth year running, we can reveal.
On Monday members will vote on whether to agree to a 1.5% rise which would net the council an extra £857,000 annually.
Despite LBC being offered a government freeze grant of £719k, it is set to reject the offer and push ahead plans for a tax hike.
In a budget report by LBC head of finance Dave Kempson and head of assets Roger Kirk the hike is said to be preferable as “the level of additional income that can be achieved is greater than that achievable from taking the tax freeze grant.”
It adds: “Given the ongoing reductions required in the council’s budget, a tax freeze strategy will require substantially more savings than a strategy of ongoing tax increases.”
The proposed 1.5% hike would see the overall council tax bill go up by £22.88 a year for Band D homeowners.
Should a May referendum for police and crime commissioner Olly Martins’ 15.8% precept hike prove successful, that Band D figure would jump to £44.72 extra a year.
Since 1998-99 LBC has increased its council tax precept 15 times and has frozen it just twice – in 2004-05 and in 2011-12.
The budget report indicates further rises to come.
It states: “The high levels of revenue support grant reduction have a very significant impact on the council.
“This means that the council needs to be prepared to make major savings and increase its income on an ongoing basis.”
The council’s government revenue support grant (including top ups) has dropped by £26.5m in two years.
> What do you make of LBC’s proposal? Email firstname.lastname@example.org or call 01582 798505