Pennies, Politics, and Party‑Sized Increases
Mathew Pennycook, the Communities Minister, is putting the spotlight on council tax – and not in a gentle way. He says the next budget will see about £1.8 billion pulled from local councils between 2025 and 2026.
What’s the Big Deal?
- Business rates are expected to bring in an extra £600 million earmarked for new homes.
- Councils can hike council tax by up to 3 %.
- There’s an extra 2 % for adult social care, so the total may climb to 5 %.
- If a council wants to push past 5 %, they’ll need either a referendum or a government green light.
- For residents in a “band D” property, that means paying more than £100 in 2025 – a figure that indeed tops inflation.
Pennycook told the Commons, “Decisions on how high the council tax can go are left to the councils themselves. The government will keep the threshold at the same level as the previous administration set.” He fired a warning at the Tories, accusing them of turning local government into a mess.
Meanwhile, the Budget Boom
The government’s Budget announced a hefty £4 billion lift for local government, with a further £1.3 billion pouring into the finance settlement. That sounds like a nice package, but the shadow communities minister, David Simmonds, fired back on the record.
“The government claims a spending boost of £3.7 billion, funded by £1.3 billion in grants, which reveals a £2.4 billion black‑hole in councils’ finances,” Simmonds said. “This shows the Chancellor’s Budget has left a hole to be filled.”
Pennycook’s reply was swift:
“We’re committed to a fair funding settlement. We’ll reveal the details in the upcoming finance settlement, which Parliament will review. As for the £2.4 billion figure, we simply don’t recognise it. Simmonds probably forgot about the £300 million in new homes and the extra business rates – let’s not miss the whole picture.”
Bottom Line
So, in plain English: Council tax is set to climb a few percentage points, the government promises extra funding, but political tussles over the exact numbers are still on. Stay tuned – this is a budget drama worth watching!
