Sheffield City Council moves ahead with plans to raise council tax by maximum 4.99%
The move was decided at a meeting yesterday
Sheffield City Council has proposed to increase the council tax by the maximum amount to balance the budget.
Members of the council’s strategy and resources policy committee yesterday (February 19) decided to accept the officers’ recommendation and allow a 4.99 per cent increase in the council tax.
At the beginning of the meeting, members were told that the local government finance settlement had granted a “much-needed 9.4 per cent increase in core spending power” which is a combination of council tax, business rates and other grants.
The increase was, members heard, due to the government acknowledging the difference in the council’s ability to raise council tax – this “some way addressing” the cuts Sheffield Council has experienced since 2010.
However, even with this increase the council’s loss in funding since 2010 is still too high.
For 2025/26, the council is forecasting pressures of £71.7million for the budget and approximately £54m of these pressures relate to social care services.
The council’s finance director Philip Gregory recommended, therefore, that the council raise the council tax to the maximum allowed without a referendum needed, which is 4.99 per cent.
He said it was a “difficult decision” during the cost of living crisis.
The increase of 4.99 per cent – 2.99 per cent for the core council tax and 2 per cent for the adult social care precept – in council tax is the equivalent of £1.23 per week for the most households in Sheffield.
Based on the calculations, people will have to pay:
Band A: £1,352.66
Band B: £1,578.10
Band C: £1,803.55
Band D: £2,028.99
Band E: £2,479.88
Band F: £2,930.76
Band G: £3,381.65
Band H: £4,057.98
This also means the council will receive £301.3m of income via council tax, which is £17.2m greater than 2024/25.
According to the calculations, the increases in business rates income and associated grants will generate £4.4m, along with the increase in council tax, will mean that Sheffield is going to have a balanced budget for 2025/26.
During the discussion, Cllr Kurtis Crossland said the report explained that the council had been left with a £2.1million “black hole” due to the government’s decision to increase national insurance.
He asked whether the council was “happy” to be left with the black hole by the government and what the council leader, Labour MPs and the mayor have done to secure more money.
Cllr Fran Belbin, the deputy leader of the council, explained that the settlement was “£17m better” than they expected this year.
“That is really significant”, she added.
The leader of the council, Cllr Tom Hunt reiterated that the extra bit of money was much-needed and praised (the Labour) government for helping local authorities after 15 years of Tory-rule that resulted in a multi-billion pound black hole in public finances.
Cllr Douglas Johnson added although it is welcome to know that there is some extra money from the government, the council was still “a long way off being comfortable”.
The topic will be further discussed at a Budget Meeting on March 5.