CROYDON COMMENTARY: The Government’s local council settlement announced on Monday saw Michael Gove give special licence to some authorities to hike their Council Tax by an eye-watering 10%.
The reason our borough wasn’t on that list, says ANDREW PELLING, is because our Tory Mayor already has massive amounts rolling in
Under Perry, following his 15% Council Tax hike last April, Croydon now has the second-highest local tax of all the boroughs in Greater London, and thanks in large part to cuts implemented under the Conservative Mayor, we also have some of the worst services in the capital, too.
We’re all paying more and getting less. Much less.
Croydon’s core spending power had the highest increase of all 349 councils in England last year, thanks to Perry’s whopping tax increase.
The council also had the biggest increase in core spending power of all London boroughs since 2015, up by 51.7%. It’s the 14th-highest percentage increase in core spending power of the 349 English local authorities.
High tax man: Jason Perry has increased residents’ Council Tax by more than one-fifth in less than two years
In these circumstances, Croydon should not be in a financial mess.
According to figures from Perry’s council’s own budget papers, the coming 2024-2025 financial year sees Croydon’s core spending power up 6.7%, a tad better than the England-wide average of 6.5%.
In less than two years since Labour lost control of the Town Hall, the amount of core spend the council has is up by more than one-fifth – 22.8%.
So the Conservatives really should have been making more progress in “fixing the finances”, as Perry promised to do when campaigning to be elected as Mayor.
London councils’ rate of overspending over income will fall to £500million from £600million in 2024-2025, which is helpful. But it is not the solution required from a Tory Government which remains fiercely antagonistic to London, while there remains a need for better financial management by councils.
Spending power for London councils is down 18% in real terms since Gordon Brown walked out of Downing Street. In the intervening 14 years, London’s population is up by 800,000. David Cameron and George Osborne’s austerity has been hurting local government hard.
The Retail Price Index is a better measurement of local government inflation costs. RPI is currently 6.1% and will likely fall further before the new financial year, so the 6.5% increase in local councils’ core spending power, as announced by Michael Gove on Monday, is helpful. But it might not be enough to prevent some basketcase councils from joining Croydon, Thurrock, Birmingham and Woking, among others, in the Section 114 club.
It is uncertain when Prime Minister Rishi Sunak will call the General Election, but what is certain is that this is the last local government settlement before an election is called, so it’s not a surprise that it’s an OK-ish deal for local government.
What fate awaits local government after the election is uncertain – Keir Starmer’s Labour, if elected, has said precious little about how it proposes to reform and rescue public services. All the indications are that they will copy the Tories and be a bit mean to Town Halls again.
Read more: Mayor Perry’s spending cuts should begin with his own cabinet
Read more: LGA warns dozens more councils are on brink of bankruptcy
Read more: Town Hall staff braced for £31m more cuts and job losses
Read more: Perry says there’s no alternative to his budget. But there’s lots
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