Council Tax: Government’s Proposed Increase

Lilian Greenwood Excerpts

Monday 25th January 2021 Commons Chamber

[Lilian Greenwood (Nottingham South) (Lab) [V]]

Today’s debate is about fairness, and the 5% hike in council tax is not fair: it is not fair on my constituents, and it is not fair on my city. As many of my right hon. and hon. Friends have already said, we are in the midst of an economic crisis. The Government bear some responsibility for the fact that our country faces the worst recession as a result of the pandemic and their failure to properly control the health crisis. This is the worst possible time to be raising taxes, yet this Government are forcing local councils to do just that, even though they know that it will hit families who are already struggling to make ends meet. Of course, those impacts will not fall evenly: they will fall hardest on the places with the highest levels of deprivation and the least ability to make up the shortfall in central Government funding.

Over the past decade, Nottingham City Council has seen its central Government grant cut by hundreds of millions of pounds. It has tried to protect services, the very services that my constituents rely on, but this year, the situation that it and other councils face is more serious than ever. Instead of doing as they promised and standing by councils that did “whatever is necessary” in response to coronavirus, the Government have left them with unreimbursed costs—£28.4 million, in the case of Nottingham City Council. It is not good enough; the Government need to do as they promised, and make up that shortfall.

Almost 40% of Nottingham City Council’s entire budget is spent on adult social care, and that percentage is rising as we face supporting more older and vulnerable residents. Central Government have repeatedly promised to meet the challenge of funding social care, but year after year, they fail to do so. Local councils have no choice but to apply the social care precept, even though in deprived cities such as mine, where demand for services is greatest, it generates far less than in areas with lower levels of demand, where councils can raise more through council tax. The Government’s approach is fundamentally unfair. It seeks to hide the truth of their decision, passing the blame on to local authorities even though they know that council tax is regressive. It is levelling down, instead of levelling up.