England faces double-inflation council tax rise

WILL BENNETT

People living in the most modest homes in Liverpool will pay more council tax than the wealthiest inhabitants of Westminster when council tax bills in England rise by more than double the rate of inflation in April.

According to two surveys published yesterday, the average rise will be about 6 per cent - less than the 8 per cent increase predicted by the Governmentacross the United Kingdom. But the final figure will rise when tax details from some London councils are published.

Liverpool is likely to set the highest rate, with a recommendation for a Band D tax of pounds 1000.82, an increase of 3.9 per cent. Even the most modest homes in Band A there will face a rate of pounds 667.21, which is more than the inhabitant of a large house in Westminster, who is likely to face a bill of pounds 590 in Band H, the highest.

Labour-controlled Southwark, in south London, yesterday revealed that its council tax will go up from pounds 589 to pounds 730 on Band D properties in the middle of the price range, an increase of nearly 24 per cent. The figure was published too late to be included in either survey.

Martin Pilgrim, finance under secretary at the Association of Metropolitan Authorities, warned that rises could have been much higher but councils were cutting expenditure and drawing heavily on reserves to keep tax increases down.

Tory-controlled Westminster City Council is using pounds 8.3m of reserves to keep the council tax bill for Band D properties down to pounds 295, a 7 per cent rise. A 20 per cent increase had been recommended by the council's chief executive.

One of the surveys was compiled by the Chartered Institute of Public Finance and Accountancy for BBC Radio 4's Today programme, which obtained figures for council tax rises from two-thirds of the billing authorities in England. The tax raises the difference between the amount councils budget to spend and the money they receive from central government.

The survey reveals that average bills for properties in Band D will increase by pounds 37 to pounds 646, a 6.1 per cent increase. The increases are highest in the West Midlands (7.4 per cent), Greater London (7.3 per cent) and the rest of South-east England (6.9 per cent) and lowest in northern England (4.9 per cent). The rate of inflation was 2.9 per cent in January.

The second survey, which was carried out by the Local Government Chronicle, which covered more than one-third of English councils, comes up with a similar figure, an average rise of 6.1 per cent or pounds 35.60. It shows huge differences between individual councils.

The biggest rise found by this survey is in Rochester, Kent, where the Band D increase will be 17.9 per cent, followed by Cherwell, Oxfordshire, with 16.1 per cent and Wolverhampton with 15.2 per cent. A 10.3 per cent rise in Hartlepool, Cleveland, will push the Band D rate to pounds 839.

Scots face average council tax rises of 15% - but for many the rise could be far higher. Scottish councils, which meet next week to fix budgets warn of big rises and spending cuts.

How the increases compare

Average Band D equivalent

1995-96 96-97 % Increase Total rise

Greater London pounds 575.60 pounds 617.60 7.3 pounds 42.00

Met districts 678.41 725.58 7.0 47.16

Non-Met districts 596.74 629.42 5.5 32.68

All England 609.11 646.08 6.1 36.97

South-east 568.06 607.04 6.9 38.98

(excl London)

East Anglia 560.32 595.23 6.2 34.91

East Midlands 632.09 664.52 5.1 32.43

Northern 677.45 710.47 4.9 33.02

North-west 705.98 744.86 5.5 38.88

South-west 596.49 623.63 4.6 27.15

West Midlands 612.97 658.53 7.4 45.56

Yorkshire and 630.86 659.90 4.6 29.04

Humberside