East Riding Council tax base to shrink
The East Riding’s council tax base is set to shrink for the first time in seven years, cutting predicted income by £1.1m.
The East Riding’s council tax base is set to shrink for the first time in seven years, cutting predicted income by £1.1m following a surge in support requests.
East Riding Council’s cabinet heard the council tax base for the 2021-22 financial year would be 117,313.4 Band D equivalent properties, down from 118,159.6 a year ago.
Council finance lead Julian Neilson told cabinet members officers were also assuming a 97 per cent collection rate compared to the usual 98 per cent because of the coronavirus pandemic.
The officer said rising numbers of households receiving council tax discounts and homes exempt because of residents dying or moving into hospitals or care homes was behind the fall.
Mr Neilson added the amount the council could expect to collect in residential levies was “very uncertain” and the £1.1m cost could double or triple within months.
Council leader Richard Burton said risks posed to the authority’s ability to raise revenue were real as he and other cabinet members noted the updates.
Officers use the base to recommend council tax rates and it is also used by other ‘precepting’ authorities including police and fire services when weighing increases.
The fall in the base is the first since local council tax support schemes were introduced to local authorities in the 2013-14 financial year.
A council report stated the total cost of discounts, including £150 from eligible households with government funds, could be as high as £7.7m if it continues into next year.
A 55 per cent increase in the number of local Universal Credit claimants eligible for support to 5,674 from 3,640 before the pandemic was one factor.
Total local Universal Credit claimants have almost doubled since before the pandemic, rising by more than 10,000 to 20,904.
The report added the number of claims for general support had risen “very sharply” since the onset of the pandemic by 18 per cent.
It warned it could rise further still depending on the scale of the economic fallout from the pandemic.
Mr Neilson told cabinet members:
“There is a significant risk the number of households claiming support will increase.
“The £1.1m impact on income could double or triple in the next few months.
“The government has allowed us to smooth the impact of that on budgets over the next three years, but the impact could be quite severe.
“If the additional £150 discount from government on some households was withdrawn the impact on them and their incomes would be huge.
“Many are claiming those discounts for the first time and at the moment the government hasn’t put any further funding for them in place.”
The cabinet heard the council would be able to slap greater rates on empty properties in the coming financial year.
Empty Home Premiums of between 100 to 300 per cent, designed to bolster local housing stocks, are set to be levied on 475 properties bringing in around £600,000.
Further additional costs are set to come from a pilot discount of per cent for Humberside Police special constables living in the East Riding.
Mr Neilson said officers were continuing to forecast a balanced budget for this year and aimed for the same next year but warned that was uncertain.
He added the government was expected to cover further losses in sales, fees and charges and that the council had so far received £4.6m.