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Perry to preside over record-breaking 15% Council Tax hike

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CROYDON IN CRISIS: The borough with one of the biggest Council Tax bills in London has just been given permission to make those bills even bigger. Much bigger. EXCLUSIVE by STEVEN DOWNES

Croydon, under Tory Mayor Jason Perry, has been given permission by the Tory government to raise Council Tax by an inflation-busting 15per cent from April, as the borough’s long-suffering residents are once again being expected to pay for the failures of their politicians.

Katharine Street sources suggest that because Mayor Perry issued his pre-emptive Section 114 notice in November, saying that he would not be able to balance the council’s budget for 2023-2024, Croydon will now have no alternative but to impose one of the biggest Council Tax hikes seen in this country for more than 40 years.

Councils in Thurrock and Slough, also on government minister Michael Gove’s “naughty step” for not managing their finances well enough, are being allowed to increase their Council Tax from April by a “mere” 10per cent.

Local authorities have their annual Council Tax increases routinely capped at 5per cent – 2per cent towards the costs of providing adult social care, and 3per cent on other expenditure. Councils that want to increase Council Tax by more than those levels are usually obliged to hold a referendeum. Today’s announcement waived the referendum requirement on Croydon, Thurrock and Slough to do that.

Mr 15%: Mayor Jason Perry

Croydon residents are already burdened with one of the biggest Council Tax bills in the whole of Greater London. Now, less than 12 months after Perry became the borough’s first elected Mayor, he will preside over a Council Tax increase that will see the bill for residents in a typical Band C property soar from £1,752 – or £146 per month – to £2,015 – up more than £30 per month to £168.

The Department for Levelling Up, Housing and Communities today issued its financial settlement for hard-pressed local authorities across England, with a 9.4per cent increase in funding overall. This represents an extra £5.1billion compared to last year’s national settlement.

The settlement includes £2billion in additional grant funding for adult and children’s social care for 2023-2024 and what the DLUHC describes as “a one-off Funding Guarantee that ensures every local authority in England will see at least a 3per cent increase in core spending power before any local decisions around Council Tax are taken”.

In making the announcement, Levelling Up Secretary Michael Gove described it as “a fair deal for local government that reflects the vital work councils do to provide key services on which we all rely”.

Council Tax hikes: as enshrined by parliament today

The residents of Croydon, especially those who voted Conservative in the local elections last May, may beg to differ, as once again they find themselves footing the bill for the poor management of the borough.

Perry had wanted to increase council rents by 11per cent this year, but he was restricted to a 7per cent increase by DLUHC.

Perry’s Section 114 notice was Croydon’s third in two years, following the Town Hall’s 2020 financial crash brought about by the free-spending and incompetent Labour administration. Perry’s S114 was the first, ever, to be issued pre-emptively, predicting that he would not be able to deliver a balanced budget in a future year.

In his election campaign, Perry had promised to fix the problems that had caused the crash – the £30million extra spent on children’s services after it failed an Ofsted inspection; the £67million frittered on the Fairfield Halls; the £200million loaned to Brick by Brick.

But he claims all his efforts are hamstrung because of the increasingly high levels of debt repayments, and interest, that Croydon is having to pay on its £1.6billion borrowing. That includes £120million in a capitalisation arrangement – a bail-out – from the government agreed in 2021. And it includes £1billion-worth of debt built up by the previous Conservative administration, in office to 2014, in which Perry was a senior member of the cabinet.

Since issuing the latest S114 notice in November, the council’s finance director, Jane West, and the chair of the government-appointed improvement panel, Tony McArdle, have both said that further multi-million-pound bail-out loans – and therefore even more debt – would not even begin to address Croydon’s deeply entrenched financial problems.

It was suggested that allowing the council to default on some of its loans – becoming the local government version of Enron – would resolve many of the issues, but there has been no mention of that from the DLUHC in today’s announcement from Marsham Street, nor from Croydon Town Hall. None of McArdle’s improvement board quarterly reports have been made public since December 2021.

Read more: Council forced to issue 3rd bankruptcy notice in just two years
Read more: Croydon needs deal that could set precedent for all councils
Read more: After nearly a year, Gove is sitting on two ‘improvement’ reports
Read more: Funding outlook for all London’s boroughs is ‘beyond bleak’
Read more: ‘We’re not teetering on the brink of bankruptcy’ claims Kerswell


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