‘West Norfolk Council has not helped itself by keeping council tax at an artificially low level’
In our weekly Friday Politics slot, Labour’s Cllr Charles Joyce discusses council finances...
The architects of austerity in 2010 passed the buck for funding local services to councils. Under the last Labour Government funding through an annual revenue support grant to West Norfolk Council was more than £12million. This year it was less than £1million.
Prior to 2010, governments of all colours and political beliefs would refund the borough council 100% of the Internal Drainage Boards’ (IDBs ) levy costs, albeit a year after the expenditure. West Norfolk is one of only a handful of areas covered by IDBs. The IDBs do a good job keeping the district free from some of the awful flooding scenes we see in other parts of the country from Cumbria to Cornwall.
Initially, the reimbursement of IDB costs was reduced to 82% of costs. Now there is no reimbursement with this year the IDBs taking more than 40% of the council’s own precept. In broad brush figures of the £7million levied by the council £3 million went to the IDBs, leaving the council £4million to fund all its services.
Any shortfall between the £23-plus million annual council budget has to be made up in some other way, much of it through fees and charges such as car parking, planning fees, brown bin collection etc. This withdrawal of Government funding has had a major impact on service provision within the borough.
But to some extent, the borough council has not helped itself by for many years keeping its council tax to an artificially low level. Had the council kept pace with the average district council’s precept Band D householders would now pay an extra £15 a year.
With Band D council tax costing over £2,000 a year would less than 30 pence a week make that much difference to householders? The policy ended in 2017. Nonetheless, over the years this policy has meant the council missing out on many millions of pounds. Money that cannot be retrieved has contributed to the present state of the council’s finances and the loss of services.
Each year the council publishes a new four-year financial plan. For the last several years there has been a problem with the fourth year showing the council’s finances are difficult. This year is no different.
Going forward the council needs to rethink policies that work against local people and its own best interests. Housing developments by the council have resulted in the sale of properties at times with a subsidy from the public purse to private buyers. It’s not that I am opposed to people buying their own homes. Security of tenure is of extreme importance. But with house prices not compatible with local wages, especially for larger properties and modern families that do not always fit with any outdated stereotype needing help as do single people and childless couples, a change in direction is needed.
By renting not only smaller new build properties but larger homes to families who live locally and allowing single young people and childless couples to share providing homes for local people, and by turning capital money into a revenue stream it helps maintain services. Loan and management costs do need to be covered, but interest-only loans are often used by buy-to-let landlords.
The council can follow the same principle. Buying outright could happen in 10 or 20 years’ time when inflation has eroded the value of the initial capital loan. People who voted Labour voted for change. It’s time for the Council to recognise we are close to the end of the first quarter of the 21st century. It needs to innovate and adapt from the old, failed policies, moving to break fresh ground and helping people who need help when they need it. For people living locally who because of high prices are locked out of buying their own home, that time is now.
