By Local Democracy Reporter Ciaran Duggan
Kent County Council (KCC) have mooted the idea of holding a referendum on increasing council tax unless it receives more Government cash, councillors have threatened.
KCC continues to lobby Whitehall chiefs for much-needed funding to cover a £50m “black hole” forecast in County Hall’s budget over the next 12 months.
Calls have been made by KCC’s Labour group leader Dara Farrell to “leave everything on the table” as councillors forensically examined the financial impact of Covid-19 on Kent councils during a virtual meeting earlier today (June 9).
At the scrutiny meeting, he asked KCC’s finance cabinet member, Cllr Peter Oakford (Con): “Nobody wants to see council tax increased, but would you consider threatening a referendum on the council tax increase threshold?
“When councils have done that previously, suddenly Government has been able to find them some more money.”
Cllr Oakford did not rule out the move as he reiterated that there were no financial “sacred cows” being offered to the county council by Whitehall bosses.
The deputy leader said: “I would support it, but I can’t speak for the leader or other cabinet members. I think we are in such a position where we will have to challenge the Government.”
Other members suggested lobbying Kent MPs to put more pressure on Government while also re-prioritising the use of KCC’s £40m reserves to cope with the growing economic strain on its £1bn budget.
On council tax, a referendum must be held if fees are likely to rise by six per cent or more. Band C homes across Kent saw bills rise by £46 to £1,201 this financial year. It was agreed at KCC’s full council budget meeting in February.
Warwick District Council considered holding a financial referendum on a 34% council tax hike for its 2020/21 budget to raise funds for its climate emergency plans in February. However, this was dismissed at late notice.
KCC scrutiny committee chairman, Cllr Andy Booth (Con), described the economic pressures faced by Kent councils as “monster” during today’s two-hour virtual public meeting.
His comments came amid a debate amongst a dozen councillors over the financial fallout of Covid-19 on the budgets of Kent’s 14 councils, who together will see a shortfall of at least £245m from the crisis.
The 14 councils have made £129m extra spending commitments to key services, but simultaneously face income losses of around £212m over the next 12 months, according to a KCC paper.
The losses include £110m of council tax; £47m from fees and charges, such as £3m from car parking, £26m of business rates and £6.6m of housing revenue.
KCC’s corporate director for finance, Zena Cooke, described the pressures as “unprecedented” and said: “Council tax losses will be dependent on the type of recession we are having, how deep the recession is and how long that lasts.”
KCC’s main costs include a rising £50m demand on adult social care, a sharp rise in the number of asylum-seeking children coming into Kent while plans are in place to manage the financial fallout from Brexit.
Cllr Oakford said: “There is significant uncertainty around our financial picture and that has made planning for the future substantially more difficult.”
A council paper will be submitted to KCC’s cabinet on June 22 setting out County Hall’s next steps around its financial recovery. KCC’s full council will then meet in September to consider a revised budget.