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Saturday, 19 April 2014

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Council tax increase among a ‘nasty surprise’ for Christmas

council tax in Tynedale is set to be cranked up by just under two per cent by Northumberland County Council – the maximum allowed by central government without a referendum.

But Tynedale households can expect to pay even more than that, as town and parish councils claim they are being forced to jack up their precepts unnecessarily because tens of thousands of pounds in government grants intended for them has been pocketed by the county.

The decision to keep the cash was described as “grand larceny” at Tuesday’s meeting of Northumberland County Council’s west area committee by Mayor of Hexham Coun. Terry Robson.

Although the county’s director of finance Steve Mason repeatedly denied that the government had included any cash specifically for town and parish councils in the county’s financial settlement for next year, Coun. Robson disagreed.

He told the meeting: “Everyone knows the money was intended for the parishes, but the county is keeping it, and that will leave Hexham Town Council alone with a £26,000 hole in its finances, which will be reflected right across the district.

“It’s grand larceny, using smoke and mirrors, and that’s the kindest thing I can say about it.”

Mr Mason explained the problem had arisen because last year the Government changed the base formula on which council tax is based.

Some households which received council tax benefit were removed fully or partly from the council tax paying base, which meant parish precepts had to be paid for by a smaller number of householders in each parish.

The Government introduced a grant to soften the impact on the budgets of town and parish councils, which Northumberland County Council was obliged to pass on the cash to the parishes.

However, the council had made it plain to all town and parish councils that had been a one-off payment which would not be repeated.

He said: “There is no specific financial provision for town and parish councils this time, and if there is cash there, there is no obligation on the county to pass it on.”

Coun. John Riddle, of Bellingham, said the county was often pleading poverty, but it had recently recovered the bulk of the £23m it invested in failed Icelandic banks in 2008.

“It’s not all bad news,” he said.

The wisdom of providing free parking in Hexham at a time of financial constraint, at a cost of some £5m to the council, was called into question by former mayor of Hexham Iain Hepple.

“Is this not being a bit reckless?” he asked.

Speaking after the meeting, Hexham’s MP Guy Opperman said the decision not to pass on Government money to local councils was “the worst in dodgy accounting”.

He said: “Firstly, we have the county council pocketing a government grant which is meant for parish and town councils, which effectively forces those small councils to increase their proportion of the council tax.

“If that wasn't bad enough the county is now also proposing to increase its own portion of the council tax, rejecting the government's offer to fund a freeze. For the people living in my patch that means Labour’s dodgy decisions mean not just one council tax rise, but two.

“It's a real double whammy that I simply can't accept. This whole budget really is a nasty Christmas surprise for my constituents.”

The leader of the county council. Coun. Grant Davey, responded: “Our budget proposals are driven by the cuts agenda of Conservative and Liberal Democrat coalition government which will see £259 worth of services cut from every household.

“We've got to find savings and cuts worth £65m in advance of the General Election in 2015 and we're determined to deliver our promises on affordable housing, free parking, a more efficient council structure and a return of council services to the county's towns.

“It's obvious tough choices are the order of the day but we're determined to show residents that this Labour and Independent administration will take decisions for the whole county not just sectional interests.”