5% rise to Luton council tax bill agreed

The 2026/27 budget manages economic risks, while seizing opportunities to invest in Luton’s future, according to a full council report.

Energy, food, and housing costs remain significantly above pre-pandemic levels, continuing to erode disposable incomes and place pressure on households and small businesses, said the report.

“Residents face rising household bills and stagnant real wages, while local businesses contend with higher operating costs and fragile consumer confidence.

“Despite these challenges, LBC’s financial position has improved, supported by the government’s recent finance settlement and prudent financial management over the years.

“To enable significant investment in core statutory services and essential infrastructure, council tax will increase by 4.99 per cent (with a two per cent adult social care precept), bringing a Band D property to £2,019.62.

“To mitigate financial volatility and support long-term budget sustainability, a resilience reserve will be established funded by the time-limited recovery grant of £6.3m per year.”

Labour Northwell councillor Rob Roche told the meeting: “I stand here proud that a Labour government has come forward with a fair funding formula.

“It doesn’t deal with the cuts we’ve seen in the recent past, but it’s a welcome start towards reversing the damage done,” he said. “The government has pledged £139m over a four-year period.

“But it’s £116m over three years we’re dealing with in this budget. The figures given contain the provision that LBC will increase the council tax by 4.99 per cent, including the adult social care precept, during the next three years.

“In real terms, that amounts to an extra £87.13m in that time. It’s a responsible and meaningful indication that this Labour government understands the challenges we face in Luton, values our financial responsibility and trusts our ability to deliver.

“To support our residents, the increase in council tax is backed up by a good welfare package, with council tax reduction and exceptional financial hardship fund. We’re also concentrating on financial resilience to support residents in crisis, debt support, maximising income, job opportunities and skills.

“With transformation and savings, we’ll balance the budget for the next three years,” added finance portfolio holder councillor Roche. “This administration has consistently delivered savings, met targets and been fiscally prudent faced with increasing (services) demand.”

Liberal Democrat Vauxhall councillor Lee Bridgen presented an amendment, asking for “the proposed budget to be referred back to the executive”.

It requested: “This committee presents a balanced budget, which restores the home to school and college transport policy for special educational needs and disabilities (SEND) pupils to the same level it was before changes were implemented.”

Councillor Bridgen explained: “The evidence already coming through is that the new SEND transport approach isn’t working for everyone. It’s shifting stress and practical burden on to families and carers.”

The Liberal Democrat amendment was defeated in a vote by the Labour administration’s majority. The budget was approved, with Labour members voting in favour, and the Lib Dem and Conservative councillors abstaining.

Precepts for Bedfordshire Police and the county’s fire and rescue service will be added to council tax bills.