Hounslow's Council Tax Support Bill May Reach £1million
Council leader 'very concerned' about borough's long term finances
Shantanu Rajawat appears at the virtual Overview and Scrutiny Committee meeting
Hounslow Council could lose nearly £1 million in revenue for the next financial year due to the rise in the number of people needing council tax support.
In a meeting of cabinet members on 19 January, it was revealed the council tax base – which calculates how much money will be raised through council tax – of Band D equivalent properties in the borough had dropped compared to the 2020/21 financial year.
It means the council could lose £976,000 in revenue raised from the council tax base compared to what it was estimated to be when budget plans were made by the top team in October.
In a report presented to the committee, it said the “most significant factor” leading to the reduction in the council tax base was due to the increased level of council tax support.
It added, “The number of claimants of council tax support has increased by 11 per cent between December 2019 and October 2020.
“This reduced revenue will increase the remaining savings gap for 2021/22 of £6.4m highlighted in the MTFS [Medium Term Financial Strategy] report.”
Finance boss Shantanu Rajawat told councillors: “In one respect that is a bit of a worry because that means a reduction in revenue, but on the other side, in light of the pandemic at least we can say our council tax support scheme is working, and really supporting those residents who are struggling as a result of the pandemic.”
The report also highlighted that the Government announced in November a new non-ringfenced grant to help councils financially suffering due to these circumstances.
Council leader Steve Curran however said he was “very concerned” about the authority's finances long term.
Any decisions to increase council tax will not be made until February's borough council meeting.
Cllr Curran said, “Our finances are, I would say, in a time of flux at the moment when we don't know what the full impact of Covid could be, and I'm very concerned about any potential council tax rise will have on our residents…
“If we're forced to put up council tax so we can set a balanced budget I will call it a Covid tax.”
He added, “The Government made it very clear at the beginning we can all quote it 'whatever it takes this government will support local government, councils, in providing services and protecting the most vulnerable'.
“Well I'm going to hold them to account from that and allowing us to put up council tax is not the right way to do it.”
Anahita Hossein-Pour - Local Democracy Reporter
January 20, 2021