Herts County Council considers council tax hike to help bridge £90 million funding gap

Herts County Council must find £90 million in savings over the next four years. Picture: Pexels.

Herts County Council must find £90 million in savings over the next four years. Picture: Pexels. - Credit: Archant

Leading members of Herts County Council are seeking new powers to increase council tax in a bid to bridge an anticipated £90 million funding gap.

Council tax increases are capped by central government each year, with 2020/21 set to be capped at 1.99 per cent.

To raise it further would need the backing of a local referendum, but HCC intends to lobby the government to ask for greater powers over council tax levels, pointing to a survey that shows 67 per cent of residents would rather see council tax increased than council services cut.

Currently HCC's element of council tax for a Band D property in Hertfordshire is just over £1,300 a year. Other similar county councils charge between £1,200 and just over £1,400.

For every additional one per cent the county council is allowed to levy, it would generate extra income of an estimated £6m.

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Increasing demand for services - like adult social care, education, children's services and waste disposal - and the rising cost of their delivery will increase county council spending by an estimated £140m over the next four years.

But a financial outlook report shows income is expected to increase by just £50m, meaning savings of £90m must be found.

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Up to half of those savings - over the next four years - have already been identified, but all council departments will be told they must identify new savings over the summer.

Councillor Ralph Sangster, executive member for resources and performance, said: "The next year will be one of the most financially challenging we have faced in recent times."

The report says: "The council has made significant savings in the region of £315m since 2010, but we are approaching a point where further efficiencies are increasingly difficult to identify and deliver.

"While all alternatives will need to be exhausted before frontline service reductions are considered, it's clear that few, if any, such alternatives are available and some difficult decisions lie ahead."

According to the report, central government funding is now £150m lower than it was in 2010.

Options include investing in services to cut costs in the longer term, selling council-owned buildings, increasing fees and charges for council services, and increasing commercialism.

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