Low interest rates could add £50 to the average Council Tax bill - Goldsworthy

Low interest rates for council investments could lose councils almost £900m compared to last year, the equivalent of £50 on the average Council Tax bill, research by the Liberal Democrats has revealed.

Draft data from the Chartered Institute of Public Finance and Accountancy (CIPFA) on local authority investments in 2007/08 suggests that the average rate of investment on all external investments in England and Wales was around 5.58%. South Yorkshire has budgeted for an investment return of just 1.5% on investments in 2009/10 compared to budgeting for a return of 5% on investments placed during 2008/09.

Commenting, Liberal Democrat Shadow Local Government Secretary Julia Goldsworthy said:

“This will put even more pressure on people paying the already high Council Tax.

“Many families are struggling to pay the bills and any increase in the Council Tax could be a burden too far. The economic crisis is hitting household and council budgets from every angle.

“The real problem here is that the Council Tax hits those who can least afford it, like pensioners, the most. Because of this unfair system, any attempt to protect local services from cuts through Council Tax rises will put more and more pressure on low income households.

“We need to scrap the Council Tax and replace it with a fair tax based on ability to pay.”

(DWP) Real help with your council tax and rent bills - Winterton

The DWP is writing to 200,000 pensioners who get Pension Credit to encourage them to contact their local council to check if they are entitled to help with their Council Tax or housing costs.

This comes after the Pension Credit standard minimum guarantee increased this April by the biggest amount since it was introduced, bringing it to £130 a week for single pensioners or £198.45 for a couple.

Pensions Minister Rt Hon Rosie Winterton MP said:

"We want everyone to receive all the help that they are entitled to, especially in these difficult times. Some people on Pension Credit might not be aware that they can also receive help with their rent and Council Tax.

"It can make a real difference. A pensioner with the guarantee element of Pension Credit, with average rent and Council Tax liabilities, could have a weekly income equivalent to around £215 a week."

"I also want more people to claim all the benefits they are entitled to which is why, from last November, we have made it easier to claim State Pension, Pension Credit, Housing Benefit and Council Tax Benefit in just one easy free phone call, without the need to sign and return any claim forms."

Pensioners who receive the letters should contact their local council. Any pensioner who wants to apply for Pension Credit itself can call the hotline on 0800 991234

In the 2009 Budget the Chancellor announced that the capital threshold in Pension Credit, Housing Benefit and Council Tax Benefit for pensioners will be increased from £6,000 to £10,000 from November 2009. This means that the first £10,000 of capital will be fully disregarded. Half a million of the poorest pensioners stand to benefit from this change with an average weekly gain across all three benefits of £4 a week.

The government is also repeating the increased level of winter fuel payments. For winter 2009/2010, the Winter Fuel Payment for households with someone aged 60-79 will increase from £200 to £250 and from £300 to £400 for households with someone aged 80 or over.

(CLG) Healey confirms action to protect council taxpayers

Local Government Minister John Healey has today confirmed that the Government will take action to tackle excessive council tax increases set this year by two police authorities.

Subject to approval of an order laid before the House of Commons, Surrey Police Authority will be capped this year. It will be required to set a lower council tax in 2009-10 and arrange for residents to be re-billed. This is the first time under current legislation that the Government has had to take action twice against the same authority.

Action is also being taken against Derbyshire Police Authority to restrict its scope for council tax increases in future years.

John Healey said:

"In this tough economic climate council taxpayers are rightly looking to their local authorities to provide good value for money and keep council tax bills down.

"Thanks to a £2.9 billion funding increase this year and greater financial flexibility and predictability the overwhelming majority of authorities have done just that. The average household council tax bill will rise by 2.6 per cent this year - the lowest increase since council tax was introduced in 1993. There is simply no excuse for excessive council tax increases.

"The action we are taking today should send a message loud and clear to all authorities - that the Government will take tough action to protect council taxpayers, including requiring authorities to rebill where necessary."

Local authorities have been helped to deliver the lowest-ever increase in household council tax bills by the stability that the first-ever three-year finance settlement provides - including a 4.2 per cent increase in funding this year alone.

Local authorities have already made £1.6billion efficiency savings since 2008 and the extra £600million savings expected in 2010-11 will be recycled back into their own frontline services, or used to keep council tax down.

While council tax levels for 2009-10 will remain unchanged in Derbyshire, a notional budget requirement has been proposed against which the police authority's budget and council tax levels will be measured for future comparisons. They now have 21 days in which to exercise their right to challenge their proposed notional amounts before a final decision is taken.

It's time to give England a fairer deal on council tax

David Cameron has promised to free up funds to freeze council tax in England by cutting back government spending on advertising and public sector consultants.

Under Labour, council tax in England has rocketed by 105%, equivalent to an extra £726 a year.

This compares to the situation in Scotland, where taxpayers have enjoyed a council tax freeze again this year thanks to a deal struck between Scottish local authorities and the Scottish Executive.

David pledged that a Conservative Government would follow the Scottish example and work in partnership with local councils, giving them extra support to deliver a council tax freeze.

Over two years, this would save a typical family £216 in tax.

David stressed, “Families and pensioners facing the economic squeeze cannot afford yet more tax rises from Gordon Brown. Yet, if Scotland can freeze council tax for its residents, we can do the same south of the border. It’s time to give England a fairer deal.”

He added that cutting spending on government advertising and public sector consultants would “also benefit the country by undoing Labour’s damaging culture of spin and restoring the integrity and primacy of our valued civil servants.”

(CLG) Average household council tax rise the lowest ever

The average rise in council tax per household next year will be the lowest ever, Local Government Minister John Healey announced today.

Figures published today show that the average Band D council tax increase will be three per cent. The average household council tax bill is almost £240 lower than the average Band D amount, and will increase by 2.6 per cent - the lowest such increase since council tax was introduced in 1993.

The first ever three year local government funding settlement giving councils an extra £8.9 billion, including 4.2 per cent more next year, is helping authorities to plan ahead and better manage the pressures their communities face. Planned efficiency savings over the settlement period are expected to reach £4.9billion.

The Government has been clear it expected an average council tax increase substantially below five per cent next year. The vast majority of local authorities have complied, with 23 councils, excluding their parish precepts, actually freezing or reducing council tax.

However, Mr Healey is also announcing today that Surrey and Derbyshire Police Authorities have set excessive increases that have been "designated" for capping action. They now have 21 days to make their case to government.

Derbyshire Police Authority has set its budget increase to 4.99% and its council tax to 8.68%. Last year Surrey Police Authority was capped and was set a notional budget for 2008/09, providing the basis for judging future increases. Based on those notional amounts, Surrey has set its budget increase to 4.82% and its council tax to 7.07%. This is the first time that the Government has had to take action twice against the same authority.

John Healey said:

"Most councils across the country are tightening their belts, which is exactly what the public wants to see. Today's figures show that the vast majority of local authorities have kept increases to a minimum.

"The average household council tax bill will rise by 2.6 per cent - the lowest increase since council tax was introduced in 1993.

"An extra £8.9 billion from the Government's three year funding settlement and £4.9 billion of planned efficiency savings are helping councils maintain both high quality public services and low council tax, and for the first time ever the public now see on their bill how efficient their council is.

"With a tough economic year ahead councils will need to do even more to control costs and I remain ready to be tough with capping powers to protect council taxpayers from excessive increases."