GARGANTUAN increases in council tax are on hold for now as discussions with ministers have been paused during the Westminster chaos.
Talks between a cash-strapped Slough Borough Council and ministers to see if the government could waive restrictions on increasing council tax pass the 2.99 per cent cap have been stalled as the new Prime Minister reshuffles his cabinet.
As part of their July review on Slough Borough Council, commissioners brought in by government to sort out the failing local authority, warned the council may have to raise council tax by between 12 and 20 per cent in each of the next three years if further support is not forthcoming.
Slough effectively declared bankruptcy last year after raking up an eyewatering £760m borrowing debt and a £479m blackhole. It is needing to save £20m a year and sell up to £600m of its assets.
READ MORE: Slough Council has "long way to go" to restore finances
Raising council tax passed the 2.99 per cent legal cap can be done in two ways – a local referendum where Slough residents will vote on this change or by having ministers approve the council’s request.
However, in a financial update, the council is assuming it will raise council tax next year by the legal amount – separated as one per cent council tax and 1.99 per cent for adult social care.
Speaking to the Local Democracy Reporting Service on Tuesday morning, lead commissioner Max Caller said they have not discussed the huge tax spike since Michael Gove was the Secretary of State for the Department for Levelling Up, Housing, and Communities under Boris Johnson’s premiership.
Greg Clark MP took over the role when Mr Gove was sacked and was then given to the current Secretary Simon Clarke when Liz Truss became Prime Minister about six weeks ago.
But cabinet reshuffles are incoming as Rishi Sunak became the new Prime Minister following the resignation of Ms Truss.
Mr Caller said: “We’ve got to wait until a new Secretary of State is appointed by the new Prime Minister. Who knows who the new Secretary of State will be before we can have a conversation.
“So, we haven’t had that [council tax hike] conversation with ministers, and given the circumstances, it’s not surprising that ministers haven’t found time in their diary to start addressing these issues.
“Hopefully, it will last a bit longer so I will have a chance to have a proper conversation.”
Slough Council collects little council tax compared with other local authorities as its average homeowner is in a band C property and has more people on the council tax reduction scheme, meaning it is not collecting the full amount billed to residents, due to high levels of deprivation.
READ MORE: Slough Council "still failing" as finances "remain extremely serious"
Mr Caller said adding a one per cent increase on people’s bills only collects an approximate £600,000. However, he also said the council has put more money into its hardship fund because of concerns about the affordability of council tax increases for the poorest in the community.
He also ruled out the council going to referendum as it would have to spend up £200,000 whether it wins or loses and completely redo the budget it made based on the assumption it would win the referendum.
Mr Caller said no local authority has won a referendum, adding: “If you lose a referendum, you’re worst off than you were before you started. The only people who have raised their council tax by more than the cap level, are those people who’ve got a waiver of legislation from ministers.
“You’re gambling such a lot and you can’t even go back where you were – you’re behind where you were.”
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