Council tax to go up by 3.6% in Rochdale – but further £1m support approved as ‘rabbit pulled from hat’ at 11th hour

Council tax in Rochdale will go up by 3.6% from April after the increase was voted through at the annual budget setting meeting.

The increase – which also includes Andy Burnham’s mayoral and policing precepts – means an average Band D household will be charged an extra £73.65 per year and Band A households will be charged an extra £49.10 per year.

A Conservative proposal to freeze the general element of council tax – which accounts for 2% of the increase – rather than targeting support at the most vulnerable, was voted down by Labour councillors.

But there was a surprise in store when Labour ‘pulled a rabbit out of the hat’ by tabling an 11th hour amendment to its own budget, which was ultimately approved.

In a highly unusual move, cabinet member for finance Councillor Carol Wardle unveiled plans to create a new poverty fund and boost the proposed £3m council tax reduction scheme by redirecting £1m earmarked for reserves.

The £3m scheme was originally targeted at bill payers who are of working age and currently qualify for local council tax support and those who become eligible for local council tax support during the 2022/23 financial year.

But that has now been extended to pensioners who are eligible for council tax support. Those with remaining bills of £50 or less will not have to settle up.
 

Read more: Thousands set to benefit from £150 cut to council tax as council provides second rebate in addition to govt supportPublished: 11 February 2022

Councillor Wardle told the meeting her concerns were with the households that struggle the most with rising prices and the burden which these taxes present’.

“With these additional proposals, I am pleased to say this budget will provide targeted support to approximately 25,000 residents who are of greatest need in our borough,” she said.

The amendment was hailed as an ‘inspired’ response to the cost of living crisis, by Labour colleague Councillor Liam O’Rourke.

But it was greeted with some bafflement by the Conservatives, particularly given council leader Neil Emmott had earlier trumpeted the ‘bipartisan’ Labour/Tory approach to setting the 2022/23 budget.

Councillor Stephen Anstee later noted that ‘finances are finite... although perhaps not as finite as I thought’, as he made reference to the late proposal.

 

 

Meanwhile, Lib Dem leader Councillor Andy Kelly described it as a ‘rabbit pulled out of the hat’ despite nine months of talks between Labour and the Conservatives.

The Lib Dems tabled an amendment for a £3m taxi scrappage scheme, funded by capital receipts and one-off reserves, to ‘mitigate the effects of the Greater Manchester Clean Air Zone’ on the industry.

This, they said, would create a ‘cleaner, greener fleet with the move to electric or hybrid vehicles that fall within emission standards’.

They also wanted to put an extra £500,000 into youth services, by scrapping the trade union subsidy and use of reserves.

However this did not find favour with the Tories. Group leader Councillor Ashley Dearnley said he had reservations over targeting only one industry and the limitations of vehicle retrofitting that had already come to light.

Labour’s Councillor Emmott was more scathing, describing the amendment as ‘the finances of the madhouse’.

But it was the Conservatives amendment where the real battlelines of this budget were drawn.

By proposing to scrap the £3m council tax reduction to fund an across-the-board freeze, the Tories were setting themselves at odds with Labour’s approach of targeting support at the poorest and most vulnerable.

Councillor Dearnley claimed that Labour’s proposal had been drawn up before the government announced a £150 payment for all households in council tax bands A-D.

He said this would mean some people would be benefiting twice, others would get no help, and was ‘unfair’.

Councillor Dearnley also echoed earlier comments from Councillor Kelly, who raised concerns over the ‘squeezed middle’ as the rising cost of fuel, food and interest rates begins to hit home.

He said: “There are concerns around the cost of living, everyone needs help – and our policy is to help everyone by giving everyone the benefit of freezing the council tax and not having this extra increase of 1.99%.

“That isn’t just to benefit 25,000 residents – I think you [Labour] are up to now, it benefits approximately 95,000 residents.”

The Conservative proposal also doubles the hardship fund to £800k, while transferring £600k to reserves.

 

 

But Labour’s Councillor O’Rourke claimed the Tories’ proposal would take money from the poorest and hand it to those who don’t need it.

“Our budget targets far more support for the poorest and most vulnerable and helps them – and the squeezed middle – at this most difficult time,” he told the meeting.

“The Conservatives amendment would slash that and put money into the pockets of millionaires living in Band G and H properties.

“I think that is unacceptable at this time.”

Councillor O’Rourke branded the amendment ‘utterly shameful’ and focused on ‘totally wrong priorities’.

The Conservative proposal was defeated by Labour in the vote, leaving the Labour budget – replete with late amendment – to be approved.

Councillor O’Rourke urged Tory and Lib Dem councillors to back it, claiming not to do so would be to vote against free bulky waste collections, keeping libraries and community centres open and looking after the borough’s roads and parks.

“It does everything that members of our community, who send us here, want us to do,” he added.

Council leader Neil Emmott commended the budget to the council.

He said: “This budget addresses the real financial pressures facing this council, but also has some good news for our residents in many, many areas.”

The budget proposals were voted through by all Labour councillors, although Conservatives and Lib Dems abstained.

 

 

 

Rochdale Council met at Number One Riverside on Wednesday night (24 February).

Nick Statham, Local Democracy Reporter