January 3, 2023 3.15 pm This story is over 15 months old

South Kesteven council proposes highest council tax rise possible for 2023/24 budget

Council among those facing significant challenges

South Kesteven District Councillors will be asked to support a £5 increase in council tax – the highest amount possible- for band D properties next week.

The authority’s budget will go before a scrutiny committee on Monday before cabinet members vote on the move on Tuesday.

In a report before members, officers said the council would also need to use around half of a £3 million “budget stabilisation reserve”.

The report said the proposals were “prepared in the context of significant financial external events that are occurring that are having a detrimental impact on the council’s financial outlook”.

They include escalation inflation, energy prices and employee pay.

“These are in the main part caused by national issues, beyond the Council’s control, and are impacting on all Councils,” said the report.

“In addition, the current cost of living crisis has the potential to increase demand for the council’s services by those who rely on the support provided by local government.

“These unforeseen and unavoidable pressures have seriously impacted the assumptions that underpin the Medium Term Financial Plan.

“The financial future remains uncertain as demonstrated by the Office for Budget Responsibility economic financial outlook.”

Officers said the “only short-term” solution was to utilise £1.534m of its £2.904m Budget Stabilisation Reserve to balance the books.

“This can only be a one-off event and council will be required to address this issue by fundamentally reviewing its financial plans to ensure a sustainable outlook without further reliance on reserves,” said officers.

Under the government’s rules, councils can apply a rise of 2.99% or £5 to council tax, depending which is higher.

The proposed rise will bring in an extra £256,000 to the council.

Elsewhere, the council continues to face reduced grants from government both in payments this year and real-terms losses due to no changes.

The council also hopes to make £600,000 of savings and £200,000 extra through fees and charges.

Tomorrow (Wednesday), Lincolnshire County Councillors will vote on whether to raise its council tax by nearly 5%.

It has warned it would need to use up to £10.3million of it’s £16.4million reserves to balance the budget if it did not.

The report puts forward three options for council tax rises in the next financial year, including a rise of 2% for adult social care (ASC) and 0.99% general tax using the £10.3 million reserves.

Other options include 2% ASC and 1.99% general taxation rise resulting in a use of £6.9 million reserves, and 2% ASC and 2.99% general which would mean the council needing to use just £3.4 million reserves.

Following a previous report on the proposals, readers urged the council to keep council tax as low as possible.

Stephen Ricketts said: “I think the way people are struggling in the current economic climate, they should dip into their reserves, not that I think for a minute they will.”

Ash Ward said: “Councils need to fix their own inefficiencies before they make the tax payer bail them out.”

Jayne Smith said: “Who can afford higher council tax bills on top of everything else that is happening? Use reserves, they are meant for difficult times.”

However, Mile Crawshaw said: “There are plenty of people in Lincolnshire struggling, but also there are tons who are more than comfortable. I’ve never seen so many land rovers on the roads.

“Feel free to tax higher earners rather than waste all the reserves.”