Government set to cap at least seven of Cornwall’s Town and Parish councils Precepts from 2017

I have received news today that from a technical guidance issued by the Government it is minded – which basically means it is going to do it – to cap town at least seven town councils in Cornwall from 2017. With a further threat of all Town and Parish Council precepts if there is a too large of a rise in the precept.

Since 2012/13 the Government has applied a core Council Tax referendum principle of 2% on major authorities, such as Cornwall Council. If an authority wished to increase its Council Tax above that level (excluding the Adult Social Care precept that was introduced in 2016/17) it would be required to carry out a referendum of its residents. A referendum of this sort would cost in excess of £750k to hold. So the likelihood of holding one is slim.

In the past these referendum principles have not been applicable to local Town and Parish Councils, although the Government has always indicated that it would keep this under review.

Nationally, the increase in the average Band D Council Tax levels set by Town and Parish Councils in 2016/17 was 6.1%, which was markedly higher than in previous years. One of the reasons for this increase is  these Town and Parish Councils have taken on more services and responsibilities like in Cornwall due to the staggering cuts to local government funding. In Cornwall the increase in these precepts is around half of the national average. As follows

2011/12 2012/13 2013/14 2014/15 2015/16 2016/17
Parishes 2.3% 3.9% 5.2% 4.3% 3.3% 6.1%

Due to the larger increases in Town and Parish precepts, the Government has now indicated that it is minded to apply the referendum principles to ‘higher spending’ Town and Parish Councils in 2017/18.

A higher spending council is defined in the consultation paper as one whose Band D charge in 2016/17 was higher than £75.46 (equivalent to the Band D charge for the lowest charging District Council) and which had a precept in 2016/17 of more than £500,000.

Such parishes would face the same referendum principles as shire districts; increases of less than 2%, or up to and including £5 on the Band D charge (whichever is higher).

However, to make things more complicated (as anything to do with tax and the Govt is), the Government has also said that it wants to ensure that parishes continue to have the flexibility to be able to take on responsibilities from other tiers of local government.

Therefore a degree  of complexity has been added to the proposal; in that the referendum principles would not apply where there has been a transfer of responsibilities and where the following three conditions are satisfied:

  1. The parish council and a principal council covering the area of the parish council have each resolved that a particular function carried out by the principal council in relation to the parish council’s area in the financial year 2016-17 is to be carried out instead by the parish council in the financial year 2017-18;
  2. The parish council and the principal council have agreed the reasonable cost of the exercise of that particular function in the parish council’s area by the parish council in the financial year 2017-18;
  3. That the agreed cost, if collected by way of the parish council precept, would take the parish council over the threshold of a 2% or £5 increase on the previous year.

Using the 2016/17 precept information, eight of the Town Councils in Cornwall would be affected by the above proposal. These are: Bodmin, Bude-Stratton, Camborne, Falmouth, Newquay, Penzance, Saltash and Truro. As far as I can tell, Helston with a precept of £303,691 would be excluded from the cap, and therefore, Porthleven would be excluded too.

Importantly however, it should also be noted that the final two paragraphs of the consultation paper state:

A large proportion of parishes are modest in size – for example, around 4,000 parishes have precepts of £25 or less. However, the Government is aware that increases in these precepts continue to concern local tax payers and is therefore prepared to consider extending referendums to all parishes.

Which basically means you raise the precept too much, and we will cap you.

The consequences of capping are huge. As Town and Parish Council have been taking on services  for Cornwall Council to safeguard them rather than see them close. I know local council’s have not always like taking on services, but they have taken a more pragmatic approach rather than losing a service. Like in Porthleven; where the town council now owns and runs the public toilets and all green spaces (which it does not already own).

Of course, the Government is saying it is consulting, but from my experience of the Governments consulting it should be interpreted at a ‘heads-up’ we are about to do this. This heads-up consultation lasts till the 28th October 2016 – just over three-weeks away.

Cornwall Council sets its budget and Council Tax for 2016/17

Today, Cornwall Council has set its budget and Council Tax for the 2016/17 period. This function has to be carried out yearly. This budget, like previous years is going to be painful due to the Governments cuts to the Council’s grant.

The recent Government’s Spending Review in a last-minute and unplanned for move, took a further £6m away from the Council’s grant. This is on top of the previous cuts. In a rapid rethink, the Government realised the slight-of-hand settlement by moving funding from rural to urban authority was going to impact on many rural authorities, including many Tory shire-lands. So they changed it. I would say this was good news for Cornwall, but even with the last-minute bribes changes, Cornwall is still £1.4m worse off than previously planned.

Councilmeeting

Your Council Tax is made up of three elements. Cornwall Council, Devon and Cornwall Police and Crime Commissioner and town and parish council’s.

The Council Tax charge for a Band D property in 2015/16 was £1,293.92. This is set to rise in the 2016/17 period to £1,345.29. This is a 3.97% increase; or a rise of £51.37 per year, £4.20 per month. However, 2% of the 3.97% rise has to be spent on Adult Social Care.

I do take issue with the Government’s plan to allow council’s to precept 2% for Adult Social Care. The truth be told is the Government should fund this. It should not be down to local postcode taxation to raise the much-needed funding for this sector. Furthermore, Children’s Services also is part of social care, yet in the current rules, all the social care precept has to be sent on Adult Social Care.

The Police part of the precept is currently set at £169.47 per year. This will rise by 1.99% to £177.84 for 2016/17. In pounds, shillings and pence, this is a rise £8.37 per year, or 69p per month.

The third part of the Council Tax bill is the town and parish councils. Each town and parish council sets its own level of precept. However, the average rise in this precept is 17.93% from £86.18 to £101.63.

For Porthleven, the town council’s precept including the other two elements is:

PorthlevenCTsettlement

Yes, the town council precept will rise by £1.30 per year. The £60.90 pays for many things in Porthleven, including the two toilets, grass cutting, maintenance of certain areas including the play parks and many other services.

For Helston Town Council, the precept is currently £303,690 per year. This will rise by 10.8% to £336,580 for the period of 2016/17. This means the town council element of the Council Tax in a Band D property in 2015/16 from £91.87 to £100.69, rise 9.6%. A £8.82 rise, or 73p per month.

Whilst this Cornwall Council budget is going to be hard-hitting, there is some good news for the Children’s Services budget. In the budget period till 2019/20, there was around £9m in un-allocated savings that was yet to be found in the service area. With the approval of the budget today, these un-allocated savings will now not have to be found. Phew. As if these savings were required, it would have far-reaching and devastating impact on Children’s Services in Cornwall.

In a comedy moment of the day, the amendment to the main budget put forward by councillors Bob Edgerton and Lisa Dolley was resoundingly defeated with only Bob voting in favour of the amendment. His seconder had left the room during the vote…

The overall vote for the budget was in 67 favour, 13 against and 21 abstaining.

Those 67 who voted in favour of the budget, did this so with regret and difficulty because of the over all impact of the cuts. However, a budget must be set.

Cornwall Council’s Cabinet recommends to Full Council a 3.97% raise in Council Tax for 2016/17

Cornwall Council’s Cabinet has today recommended the amount each household will pay in Council Tax for the 2016/17 period. The final approval for the Council’s budget rests with all 123 Cornwall Councillors at a Full Council meeting.

Any reader of this blog will know the austerity imposed on local authorities like Cornwall Council has resulted in services being reduced or stopped. Even with the latest Spending Review, the Government in a rather underhanded way reduced Cornwall Council’s grant by a further £6m.

A slight positive in that Spending Review is local authorities can opt for a four-year funding settlement rather than a yearly one. This gives the Council scope to plan better rather than waiting each year to play the guessing game on how much funding the Council will lose. We will be accepting the Governments offer of a four-year settlement.

Also in that review, the Chancellor introduced a new levy of a 2% increase in Council Tax to be spent on Adult Social Care. My annoyance with this is there is more to social care than adults. Children’s Services pay a large and important part too. Yet, the Government has again forgotten about this very important element in this levy.

As I said the 2% can only be spent on Adult Social Care services. At face value this is good, as more funding will go towards Adult Social Care. However, the £21m this will raise over the next four-years, £16m will go towards implementing the Governments living wage in this sector. I am a firm believer in the minimum wage, but this should be funded correctly by the Government, and not left to local taxation. This also means you end up with a postcode lottery on the amount of money it raises due to the Council Tax base rates which differ between each local authority.

Yet, this will improve this service area not only in wages, but it will protect some of the services. If the social care precept was not added, then these services would be at risk because of the cuts to the Government’s grant.

In the Council’s four-year budget plan, Cornwall Council’s Council Tax rate will raise by 1.97%. This is not because we want to, but because many millions have been taken away by the Government by means of the grant.

The next step, subject to Full Council approval in February, Cornwall Council’s element of the Council Tax (CT is made up of Cornwall Council, Town/Parish Precept and Police) will rise by 3.97%. The true percentage will be higher once you add in the police and town/parish precepts.

The current level of Council Tax for a Band D property is £1,293.92 and will rise to £1,345.29 in 2016/17. This equates to a £51.37 per year, or £4.20 per month, or 98p per week rise on a Band D property if you just include Cornwall Council’s element.

As I said previously, raising taxes is not something we want to do. However, the very fact Cornwall Council has had its budget cut slashed by Government so much, there is little other option but to raise Council Tax.

 

Cornwall Council sets Council Tax for 2015/16

Today, Councillors at Cornwall Council set the Council Tax rate for 2015/16. The Council Tax rate is made up of three parts; Cornwall Council, town/parish council and the Devon and Cornwall Police and Crime Commissioner’s budget. These three elements make up what you and I pay each year. For the record, the vote on Council Tax was 63 for, 19 against and 19 abstentions

Cornwall Council needs £498.136m for the 2015/16 period. This is made up of £82.319m collected from Business Rates, £174,250m in Government Grants, £8.862m from Collection Fund Surplus which leaves £232,705 to be collected by means of the Council Tax. The total precepts for the town and parish council’s comes to £15,499,788.29. This is an average raise of 11.46% on the town and council precept. The total amount for the Devon and Cornwall Police and Crime Commissioner comes to £95,762,365.44. This is a 1.99% increase on the previous years.

In 2014/15 the Council Tax was set at:

  • Cornwall Council – £1,268.92
  • Crime Commissioner – £166.16
  • Average  Town and Parish Council precept – £77.30
  • Total = £1,512.38 on a Band D property.

For 2015/15 Council Tax will be set at:

  • Cornwall Council – £1,293.92 (a rise of 1.97%)
  • Crime Commissioner – £169.47 (a rise of 1.99%)
  • Average Town and Parish Council precept – £86.18 (a rise of 11.49%)
  • Total = £1,549.57 on a Band D property. This equates to a 2.49% rise.

As I represent Porthleven and Helston West, I will give the figure of the actual town council precepts for both Porthleven Town Council and Helston Town Council.

Porthleven Town Council total precept for 2015/16 is £63,397.62. This means a Band D property would be required to pay £58.60 per year. This equates to £4.80 per month or £1.12 per week. This is a rise of 12.11% from the previous year’s precept of £52.27.

Helston Town Council total precept for 2015/16 is £303,690.00. On a Band D property this would equate to £91.87 per year. Again this can be broken down to £7.60 per month or £1.70 per week. This is a rise of £10.51% on previous years which the precept was set at £83.13.

Let’s be fair to those town and parish councils who have raised their precepts as this is because many have taken on additional responsibilities like toilets, grass cutting and in some cases car parking. These services still have to be paid for and credit should go to them for taking on these services. It is a difficult time for local government, as with the stinging cuts imposed on local authorities by the Government, plus increased demand on services, Cornwall Council cannot afford to do all it used to. I wish was different, but when you lose ten’s of millions in cash terms by ways of Government grants, services will have to change.

For those wishing to know the precept for their own town and parish council should click HERE.

 

 

Go paperless billing with Cornwall Council

The internet, love it or loath it, it is now a part of our lives. We do our shopping, check our bank accounts and access our utility bills via the internet. You may not know it, but you can also access many Cornwall Council services via the internet. These include planning, but did you know you can also use the internet to view your council tax, business rates, housing benefit or council tax support. Some of the things you can do include:

  • Sign up for e-billing so you are no longer sent paper bills
  • Sign up for e-letters so you are no longer sent paper benefit notifications
  • See full details of your account or claim
  • See how your charges or benefits are worked out
  • See when your payments are due
  • Set up a direct debit or make a payment for council tax or business rates
  • Check your council tax discounts and allowances
  • Notify the Council you are moving (Council tax only)

Council Tax can be accessed HERE

Business Rates HERE

Housing Benefit and Council Tax Support HERE

Should Cornwall Council raise Council Tax above 2%?

The Cabinet and the wider membership of the Council are currently in the process of deciding the budget for 2015/16 and up to 2018. I have said before, this budget is going to be very difficult. As having to find savings of £196m or losing one take one-third of your budget will mean services will be affected.

Setting the budget is made more difficult by the government imposing a 2% cap on the maximum a primary local authority can raise Council Tax. I have never been supportive of an ad-hoc raise, as any raise has to be justified, but when you are faced with such draconian cuts in the face of increased demand, it would be helpful if a Council had the ability to raise income that helps supports services.

The Government talks of devolution and handing powers down to Councils, but when it comes to setting a budget the Government hog-ties a local authority on setting its budget. It should not be up to Westminster in settling the a Council Tax figure, but the local authority.

The current legislation is if a local authority wants to go above the 2% cap, then it needs to hold a public referendum. 

One of the issues of holding a referendum is the sheer costs of running one. In Cornwall’s case we would not get much change out of £1.2m if Cornwall Council held a stand-alone referendum. Raising Council Tax by 1% would bring in an income of roughly £2.2m. So going 1% above would not really stop so many of the service reductions. If you want to help mitigate the impact of the reduced funding, the Council would need to look at a larger increase. For arguments sake, a 6% rise would net you £9.086m.

Even if the local authority wanted to raise it above the 2% it would have to convince the public to agree and vote yes. If you held a stand-alone referendum and lost, you would have to find additional savings to cover the cost of the referendum.

I will point out that if you want to stop the full impact of the £196m a few percentages added on is not going to have much impact. You will need to look at percentages above 25%/30%.

However, a stand-alone election might not have to happen, as the referendum could also take place at the same time as the general election. If this referendum took place at the same time as the general election you would still be looking at a running cost of around £700k.

A further difficulty in holding the referendum is this vote would be after Council Tax bills have gone out. So if a referendum was carried, there would be a need to re-sent Council Tax bills with the new Council Tax figure.

The question is, should the Council look into rasing Council Tax about the cap of 2%.

Councillors will hopefully be able to discuss this at full council, but what do the people of Cornwall think? Feel free to send me your views on this? I have added a poll, please give you views there too.

[poll id=”7″]

 

Cornwall Council passes a budget with a 1.97%* rise in Council Tax

For the first time in nearly four years the Cornwall Council element of the Council Tax will rise. For those who do not know the Council Tax is made up of three elements – Cornwall Council, town and parish precepts and Devon and Cornwall Police precept.

For 2014/15 period for the Devon and Cornwall Police precept will rise £166.16 (1.99%) per year for a Band D property. For town and parish councils, the average increase will be £77.30 (10.86%) per year. Again on a Band D. The Cornwall Council element is 1,512.38 (1.97%) per year on a Band D.

When you add it all together, the increase for a Band D property for 2014/15 is £35.32 per year, or 67p per week. For the eagle-eyed readers, the actual increase is 2.39%*, but this includes all the elements of the Council Tax with two elements out of the control of Cornwall Council.

Some would argue to protect service, there should be a bigger rise. However, the Government has restricted primary LAs from rising their element of the Council Tax no more than 2%. Anything over, will require an expensive referendum. So in a true sense, the 2% max is a cap imposed by Government.

After a shorter than expected debate, and no alternative budget from the Tories, – though one was submitted, but then pulled by their Group Leader yesterday, or anyone else for the matter. A vote was taken, and the budget was passed 71 for, 35 against, with one absenstion.

Full budget documentation HERE

2% or 6% Council Tax Rise?

As a member of the Cabinet at Cornwall Council we as a collective have set our provisional budget for 2014/15. This includes a 1.97% rise in Council Tax for this period. This is to deal with £19m budgeted savings and the extra £23.9m that has to be found for this period. This is not the only pain, as £196m has to be found in the next five years which includes up to £50m for the 2015/16 period.

However, the stance of 1.97% rise  is not fully supported throughout the entire membership of the council. As some members want another year of Council Tax freeze and now, a group of Councillors within the council want to see a 6% rise. The point of a rise is an interesting one, as you could rise Council Tax to provide and safeguard those services. But the flip-side is can people afford the rise?

I always like to put the impact of a rise into pound, shillings and pence. A 6% rise would result in a rise of about £1.40 per week on a Band D property. A 1.97% is roughly 42p per week.

For those who don’t know it, for every 1% increase raises just over £2m in revenue. So to protect all services, Council Tax would have to rise by a lot. For instance you would have to put up Council Tax about 19% to cover the cuts in the 2014/15 period.

You could argue the merit of looking at a bigger rise, but Government rules on rising Council Tax forbids a council from rising it above the 2% threshold without a referendum. The sting in the tail is a referendum will cost £920k. And you would still have to find this money from the existing budget if you lose the referendum. Even if the council agreed to the principle of a 6% rise, the council would still have to find roughly £15m of the £19m worth of extra cuts.

My view on this is two-fold. A 6% rise would be difficult to win on a referendum as households are already feeling the pinch; and finding the extra money over still massive cuts could be a step too far for many. I believe a 1.97% rise is right. But I do acknowledge there needs to be a bigger discussion on the 2015/16 budget and having to find up to £50m worth of savings.

What do you think?

 

Impact of Welfare Reform in Cornwall

The impact of the welfare reform is now starting to show in the data Cornwall Council collects.

The emerging data is showing a rapid increase in rent arrears for those affected by under-occupation charge – bedroom tax – in Cornwall Council owned housing.

Currently 560 of Cornwall Housing – Cornwall Council owned properties – tenants are in arrears due to the impact of the Bedroom Tax. This is a 140% increase from April to June 2013. I should point out Cornwall Housing has 10,500 properties under its control; so in percentage terms this is 5% of tenants.  As yet, there is no data which includes all the 19 RSL operating in Cornwall, but I am reassuringly assured this is being worked on. Once this has been collated, the council will have a better understanding of the impact the welfare reform is having.

The collection rate for Council Tax is down, not by a big percentage, but a drop nonetheless. To date Cornwall Council has issued 48,600 reminders. This is a 40% increase compared to last year. Though it would be incorrect to say the increase is all down to the welfare reforms.  And with changes to the council tax benefit system, Cornwall is seeing 20,000 new payers of council tax. Out of this figure, 5,500 (28%) of new payers are in arrears with 1,000 households receiving a court summons.

The Council has seen a big increase in enquiries relating to welfare reform with 40% more benefit enquiries from March/April 2012 to March/April 2013. There has also been a 50% increase in revenue enquiries and 40% more ‘face to face’ enquiries regarding Housing Benefit or Council Tax Benefit.

As for Cornwall’s 23 food-banks, they have seen a 35% increase  in usage between Q4 2011 and Q4 2012. No doubt this figure will rise again by Q4 2013.

The data used on the post is taken from the 1st Quarter 2013 -14.

Cornwall Council’s use of a Lie Detector Test

The use of a lie detector test, or to give it its official title voice risk analysis (VRA), is being used by a Capita who have been hired by Cornwall Council to check if people were telling the truth when claiming the Council Tax Single Person Discount (SPA). This met with some uproar from both Councillors and the public. It resulted in one Cabinet Member quitting, and a Motion being submitted to full council to ban its use. It was disappointing that the Motion was not debated, but kicked to a committee for investigation.

Furthermore, Cllr Robinson asked a question to the Leader on the use of VRA which was not fully answered. So in line with the council’s constitution, the answer has been sent to all Councillors explaining the use of VRA.

Individuals are told at the start of the voice risk analysis (VRA) interview that the call will be monitored and recorded for the detection of fraud. When a VRA interview is conducted, the trained assessor calibrates the technology by asking a series of questions that the caller would know the answers to immediately, such as confirmation of name and date of birth.

The assessor will then ask the interviewee a series of open questions and will then, using behavioural analysis, risk score each answer using pre-defined criteria.

Once an interview is complete, the responses are reviewed alongside information gathered during previous review processes.

So how are people selected? the official line is as follows:

Capita apply a ‘Balance of Probability’ approach when identifying cases where a taxpayer has stated that they are entitled to SPD, but this strongly conflicts with the analysis/credit searches conducted.  Such cases will be carefully selected through the application of appropriate criteria and only high risk cases will be considered for telephone interview.  Residents are then invited to undertake a VRA telephone interview for further assessment of their entitlement.  The VRA technology has not been deployed within our own Contact Centre and it will therefore only be applied to those residents who are invited by the Capita SPD team, located in Bromley, to undertake the telephone interview.

I do though agree with the council zero tolerance on benefit fraud, but I still do not think VRA should be used. More so as the technology is far from accurate. The use should be stopped until the relevant committee has had time to investigate. I also await the further information on how many people have been subjected to this treatment, and if anyone refused to take part.

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