Householders face largest council tax increase 'in a decade'

The 1.99% council tax rise is available to all local authorities authorities Credit: PA

Local councils are planning inflation-busting rate hikes that will see householders in England facing an average council tax bill of almost £1,600, the largest increase in a decade, public finance experts have warned.

A survey of councils found they were planning an average increase of 4%, which will add £60.94 to Band D bills from April.

That means bills for average Band D houses across England will rise to £1,590.53.

The warning comes form the Chartered Institute of Public Finance and Accountancy (Cipfa), which surveyed English councils and found most authorities with responsibility for social care were planning hikes in order to make ends meet.

Authorities with social care responsibilities are allowed to raise bills by up to 4.99% without triggering a referendum.

Smaller councils without those duties can increase bills by up to 1.99%.

Sean Nolan, director for local government at Cipfa, said: "The fact that we are facing the single highest council tax increase in a decade is all the more remarkable because it comes after six years of very low increases, actively encouraged by government who until last year had offered a council tax freeze grant if councils did not raise theirs at all.

"The subsequent removal of this freeze grant shows a clear shift in public policy in general, but also a reflection of the strains being caused by social care pressures. We can expect these levels of increase to continue at least for next year."

The Department for Communities and Local Government said that council tax would remain lower 'in real terms' Credit: PA

A spokesman for the Department for Communities and Local Government said that, despite the increases, council tax would be still be lower "in real terms" than in 2010.

About 95% of councils with social care responsibilities will be setting the social care precept rate at at least 2%, according to Cipfa's survey, while 70% will be increasing tax by the maximum amount of 3% - on top of the up to 1.99% rise available to all authorities.

That 4% average increase covers all council tiers, and includes contributions for police, fire, the Greater London Authority, and those without social care responsibilities.

For English counties, unitaries, metropolitan districts and London boroughs - all of which are entitled to the additional social care precept - the increases are 4.3%, 4.8%, 4.9% and 3.9% respectively.

The Cipfa survey was sent to all 420 English authorities, with 307 responses - a 73% rate.