§ Lord Hanningfieldasked Her Majesty's Government:
What is the estimated average percentage increase in council tax for the next financial year in England and Wales for (a) county councils; (b) unitary authorities; (c) district councils; (d) police authorities; and (e) fire authorities; whether there are any variations in this estimate between H M Treasury and the Office of the Deputy Prime Minister; and, if so, why. [HL111]
§ The Minister of State, Office of the Deputy Prime Minister (Lord Rooker)The level at which authorities set their council tax in 2005–06 is primarily a matter for individual councils. The Government have recently announced the provisional local government finance settlement for 2005–06 which provides another very good settlement for local government. It provides for an increase in total support from government grant and business rates in 2005–06 of £3.5 billion, or 6.2 per cent and guarantees an above-inflation increase for all authorities.
Given this substantial investment in local government, the Government expect to see substantially lower council tax increases next year. Average council tax increase in England in 2005–06 should be less than 5 per cent. This applies to all authorities, including police and fire authorities. The Government are prepared to take even tougher capping action next year than we did in 2004–05.
The Government consider locally financed expenditure as part of the Budget, which includes assumptions about increases in yield from council tax, but also includes a number of other elements such as interest receipts, trading receipts and the housing revenue account.