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COUNCIL TAX WARNINGS SENT TO 31 AUTHORITIES
Independent - 17 January
2004
PAUL WAUGH DEPUTY POLITICAL EDITOR
MINISTERS SEEKING to head off a council tax uprising have
warned 31 local authorities their budgets will be cut unless they scrap
large rises planned for this spring.
Nick Raynsford, the Local Government Minister, confirmed he
had written warning letters to the councils that are poised to put up
bills by more than 5 per cent.
Yesterday, Tony Blair said there was "absolutely no justification"
for major increases this year, following the criticism over last year's
record- breaking 13 per cent average hike. The Government is considering
a range of potential reforms to the way local authorities raise money,
including reform of, and even possible replacement of, the council tax.
Mr Raynsford's letter expresses "concern" at the
planned increases and adds that taxpayers would find it "hard to
understand" how such rises could be justified given the extra millions
poured into local government by Whitehall.
On the BBC Radio 4 Today programme, Mr Raynsford confirmed he was threatening
to cap possible spending increases by a string of councils.
Although he did not name the guilty town halls, they are thought
to include Brighton and Hove, Islington, North Yorkshire and Northumberland.
They are spread across England and Wales and controlled by all three political
parties.
"I have written to 31 councils from whom we have got
information suggesting they may be contemplating increases in council
tax of above 5 per cent. I have got capping powers. We will use those
powers if necessary," Mr Raynsford said.
However, he said he hoped that such an extreme sanction would
not be necessary.
"This is just a preliminary letter and I hope, as a result
of it, councils that are considering a large increase in council tax will
moderate their proposals."
Responding to Mr Raynsford's comments, David Curry, the Tory
local government spokesman, said that the council tax crisis was of the
Government's own making.
"It is now panicking and waving the big stick of the
threat to cap, which is something it said it would not do. It has piled
spending demands on councils without providing the funds to pay for them,"
he said.
"We think councils should set the lowest tax level possible
while maintaining services to a level the public expects.
"However, the Government simply has to recognise that
councils don't raise council tax for the sheer pleasure of watching the
taxpayer wince but to meet the year on year spending requirements forced
on them by the Government."
The whole issue of council tax has been burning away at regional
level but burst on to the national agenda when average rises earlier this
year shocked ministers into action.
Pensioners in particular feel their income is being hit hard
by the charge and today a mass march in Westminster will underline their
anger.
Council leaders have been sceptical about previous government
threats, but ministers clearly hope that the letter, which was sent on
Wednesday, will prove just how seriously they take the issue.
Sir Jeremy Beecham, the chairman of the Local Government Association,
said he was opposed in principle to capping. "I am disappointed that
capping is being considered at all," he said.
Mr Raynsford hinted for the first time yesterday he was set
to adopt proposals to increase the amount in business rate paid by companies
to councils.
© Independent
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