The first increase in council tax for eight years was amongst the budget proposals recently agreed by the Kensington and Chelsea Cabinet.
The 1.9 percent increase will, if the budget is approved by the full Council on 8 March, contribute £1.5 million to the Council in 2017-18, money that would otherwise have to be found from reductions in services.
Overall, the Council must find some £8 million of efficiencies or extra income in 2017-18 in order to compensate for reductions in government grants. And 2017-18 will be the seventh consecutive year in which such grants have fallen. In fact, by 2017-18 the Council’s budget will have shrunk in real terms by about 22 percent since 2010/11.
Fortunately, the Cabinet’s strategy for coping with austerity has so far proven highly effective. Thanks to sharing services with neighbouring boroughs, traditional savings and efficiencies and more dynamic stewardship of its property portfolio, just five percent of the savings required from the Council since 2010/11 have had to come by way of service reductions.
Sharing the management of services with neighbouring boroughs for example is now saving the Council approximately £13 million a year, while annual income from property is expected to rise to £13.8 million in 2017-18, up from just £3.8 million in 2010/11.
However, the Cabinet agreed that the strategy’s potential for yielding further income and savings is now shrinking, hence the proposal for an increase in council tax.
Even with a 1.9 percent increase, the Royal Borough’s tax will still be the fifth lowest in the country. The Council will remain one of the small minority in London still paying council tax benefit that covers 100 percent of council tax bills for those dependent on benefit. And it will also remain just about the only council in the country still meeting the ‘moderate’ care needs of vulnerable adults.
“I am very proud of the way we have maintained good quality services for our residents,” said Leader of the Council, Cllr Nick Paget-Brown. “But after seven years of austerity, we are now facing stark choices. If we are to continue delivering good services we must find some additional money; after an eight-year freeze, a modest increase in council tax seems a sensible way to start.”