CROYDON IN CRISIS: In a trick of political deviousness, Chancellor Rachel Reeves might be able to claim she has not broken a manifesto commitment while Croydon’s Mayor will keep to his ‘pledge’. But ordinary residents will all end up paying more. By STEVEN DOWNES
Flummoxed: Jason Perry can’t cope if he has to answer questions without referring to his script
Croydon’s Tory Mayor, staring down the abyss of a £45million overspending hole this year, has refused to rule out hiking Council Tax by more than 4.99% if he is given the leeway to do so by Rachel Reeves’ Budget later this month.
Chancellor of the Exchequer Reeves is due to deliver the first Labour Government Budget for 15 years on October 30. Her decisions and choices on taxing and spending have been the subject fervant speculation around Westminster and in the country at large, as the people who voted in a Labour landslide in July on the promise of “Change” fear that they are likely to get hit with more of the same.
And for cash-strapped councils across the land, there’s a genuine fear that there will be more Gideon Osborne-style austerity, which has been bringing many authorities to the brink of bankruptcy.
Reeves and her boss, Prime Minister Keir Starmer, have promised no more austerity, but councils that deliver essential local services have so far been left in the dark over key issues, such as the size of local government settlement for 2025-2026 and whether it will be a multi-year settlement, to provide a little more longer-term stability for those in charge of Town Hall budgets.
Outsourcing austerity: could Rachel Reeves and Keir Starmer be considering allowing councils to increase local taxes by more than 5%?
On Wednesday night, at the latest public meeting of Mayor Jason Perry’s cabinet, Jane West, the council’s finance director, repeated her previous admission that, while she is grappling with her own budgetry crisis and is expected to deliver a “balanced” budget for the borough by February, she has absolutely no clue what measures might be announced by the Treasury when Reeves takes to the Despatch Box in Parliament in a fortnight’s time.
Labour’s election manifesto in the summer promised no tax increases for working people. “But there’s nothing to stop Reeves outsourcing the misery, like Osborne liked to do, letting local councils do his dirty work in cutting services and raising taxes,” a Katharine Street source said today.
Perry has already said that he will increase Council Tax by the maximum possible next April. He has no option, given his complete failure to “fix the finances” as he promised, with the council’s spending running out of control because of demand for housing and adult social care.
The question at issue now, though, is just what is the “maximum possible” Council Tax increase?
Over recent years, the government has capped Council Tax increases at 4.99%. If a council wants a bigger Council Tax increase than that, then they have to hold an authority-wide referendum (and we can all guess what the outcome of that might be).
Fund Croydon Fairly: no amount of protesting could get Tory Mayor Jason Perry to change the 15% Council Tax hike
In 2023, piss-poor Perry hiked Croydon’s Council Tax by 15%, without any referendum, because the then Secretary of State for local government, Michael Gove, gave him special permission.
Croydon’s Council Tax has increased by 21% since Perry took office, and is now the second highest in London.
But with a queue of local authority CEOs lining up behind Croydon with their begging bowls for more government money, Reeves could yet “do an Osborne” and outsource the misery by raising the Council Tax cap above 5%.
If she did that, Reeves would keep to Labour’s manifesto commitment of no government tax increases on working people, while providing additional finance to councils at no cost to the Treasury.
“It’s exactly the sort of thing those devious bastards might do,” the Katharine Street source said.
Labour councillor Stuart King, the leader of the largest opposition group on the council, managed to sneak a question to pompous Perry on Wednesday night during a depressing discussion of the council’s medium-term economic plan.
“The plan assumes,” King began, “that Council Tax will rise by 4.99%, the current and assumed threshold.
“If that threshold is higher than 4.99%,” King continued, mentioning the £45million overspend gap in Perry’s busted budget, “will you be seeking to raise Council Tax by that new, higher threshold?”
It was the sort of question that could be given a one-word answer. Perry proceeded to babble and blather on for more than two minutes.
But he never said, “No.”
Reasonable question: Stuart King sneaked his Council Tax question in when piss-poor Perry wasn’t expecting
“The answer right now is that I cannot give you that answer,” Perry said, sounding more uncertain than usual without the aid of the carefully drafted script that he normally relies upon.
“We need to see what it is when it comes through,” Perry said.
Having stung all Croydon residents with his 15% Council Tax hike 18 months ago, Perry now claims he has taken the pledge… not to not drink, but to not raise Council Tax by more than the level of the government’s cap. It is perhaps an easy pledge to make, on the grounds that he would never again be allowed to do so.
“My pledge has always been…”, since he went through the cap, “… to not go through the cap again.
“If the cap is raised, we’d need to look at that when we come to that point,” Perry said, appearing to leave the possibility very much alive.
Perry, who as Mayor has made it more difficult than ever for those in need to claim Council Tax relief, then blathered on about how “we’re at the point of diminishing returns”, because any Council Tax increase would necessitate an increase in council benefit payments. “It was just the latest occasion in which Perry demonstrated his economic incompetence,” one observer at the meeting suggested.
Perry continued (as he is wont to do): “We’d need to take all of that into the equation at the appropriate time.” Which again is not a “No.”
“Right now we don’t have that information but the pledge remains that we would not go through the cap.” Which was not what he was asked.
“But we will have to see what the Budget brings.”
He never said “No”.
When an honest answer would have been a simple, “Yes.”
Read more: Mayor Perry busts his unbalanced budget with £42m overspend
Read more: Oxford professor explains Budget in Andrew Fisher Interview
Read more: Perry pleads poverty when he has more Council Tax than ever
- If you have a news story about life in or around Croydon, or want to publicise your residents’ association or business, or if you have a local event to promote, please email us with full details at inside.croydon@btinternet.com
- Our comments section on every report provides all readers with an immediate “right of reply” on all our content. Our comments policy can be read by clicking here
- Inside Croydon works together with the Bureau of Investigative Journalism, as well as BBC London News and ITV London
