Issue - meetings

The Section 151 Officer presented a verbal report on Council Tax Options for Setting of 2025/26 Council Tax. The MTFP will be presented after Christmas, which will include updated figures for the 2025/26 Council Tax. This presentation served as a reminder that Council Tax contributes to the general fund budget, which helps fund essential services.

It was noted that the MTFP figures have not yet been updated this year and the data currently available is from the previous year, as included in the Q2 budget monitoring report.

It was highlighted that the Council Tax increase in recent years has been modest, with increases of 10-11p per week and noted that the Council Tax strategy typically aims to take the maximum increase allowed, as this is what the Government expects when calculating grant allocations.

The Section 151 Officer explained that the Council typically receives about 10% of the total council tax bill, with the County Council receiving the largest share at 73%, followed by the police at 13% and the fire authority at 4%.

The Section 151 Officer noted that the October budget provided little information on potential Council Tax increases. Historically, the Government has permitted the higher of 1.99% or £5 and more recently, the higher of 2.99% or £5. There is speculation that the Government might allow the higher of 2.99% or £10, particularly for councils with a low tax base, though it was expressed that it is unlikely the £10 option would be offered.

The Section 151 Officer also highlighted the upcoming Fair Funding Review, which could reset the local government finance system and lead to a potential £3 million annual loss due to changes in business rates. The Government assumes that the Council will increase its share of the Council tax bill by the maximum allowed when setting business rates limits and the Revenue Support Grant (RSG).

Finally, the officer provided projections showing the impact of a 2.99% Council Tax increase for 2025/26, with the additional revenue building each year. By 2028/29, this could generate an additional £500,000 in revenue, illustrating how regular increases compound over time.

This update was provided for Member’s information.