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TAX bills soar - the Star explains why

PUBLISHED: 00:30 29 March 2002 | UPDATED: 11:38 03 March 2010

COUNCIL tax bills across Suffolk have been increased by several times the current rate of inflation.

The current inflation rate in Britain, depending on which measure you use, is between 1.

COUNCIL tax bills across Suffolk have been increased by several times the current rate of inflation.

The current inflation rate in Britain, depending on which measure you use, is between 1.5 and 2.5 per cent.

Council tax bills that are dropping on to doormats now will be for increases of between 12 and 14 per cent.

So why are bills going up so steeply? Who is responsible? Is Suffolk unique in facing this council tax increase?

Council tax bills are made up of three or four elements.

The largest single element – between 65 and 70 per cent of the bill – comes from the county council. That pays for education (by far the largest single element of the bill), social services, transport – including the maintenance of most roads, libraries, the fire service, trading standards, and strategic planning.

In Suffolk the county council element of the bill is going up by 11.9 per cent. That's steeper than many other nearby counties – but not excessively so.

Both Norfolk and Essex are putting their council tax elements up by 9.8 per cent, Cambridgeshire's rise is slightly less at 9.3 per cent and Northamptonshire's is the same as Suffolk.

While the percentage increase in Suffolk is higher than its neighbours, the actual amount demanded is in many cases less.

The owner of a Band B property in Suffolk will pay £584.43 to the county council from April.

In Norfolk the county charge will be £589.94, in Essex £597.36, and in Cambridgeshire £567.93. In both Essex and Cambridgeshire average house prices are much higher than in Suffolk so more properties are in higher bands with residents paying more.

Only 34 per cent of what the county council spends is paid for out of council tax bills – the rest is determined by the government.

Out of a total budget of £507 million, £181 million comes from business rates – set by the government – and £151 million direct from the government. That leaves £175 million to come from Suffolk's council tax payers.

But the government elements are fixed, if the council does need more money than the government says, that increase all has to be paid by council tax payers – and that increases the percentage of any tax rise.

After changes to some sixth-form funding, the government said the council should be spending £493 million, not £507 million, next year – that's a 2.8 per cent difference.

The council decided to press ahead with the higher figure – but the government wasn't prepared to raise the business rate figure from £181 million or the direct grant from £151 million.

So the entire extra was shouldered by council tax payers – our proportion of the bills totals £175 million rather than £161 million. That's 8.7 per cent more, and when added to the 3.2 per cent increase the government recommended, the total rise is 11.9 per cent.

Government regulations and medical advances mean councils have to spend more caring for elderly and disabled people. They are living longer, have to be cared-for longer and that costs more money.

County councils across the country have complained that the increase offered by the government is not enough. The average increase is 6.2 per cent, Suffolk has been given just 5.6 per cent and Norfolk a more generous 6.7 per cent rise.

Suffolk is spending £14 million more than the government recommends, £9 million of that is going to its social services budget – it is spending £128 million on social services rather than £119 million.

The percentage figures for the increases all look small in themselves – but when the multiplier is included, the total racks up to about five times the current rate of inflation.


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