BusinessCompany NewsPrescott under fire over council tax shortfall

Prescott under fire over council tax shortfall

Party leaders at the Local Government Association have written to deputy prime minister John Prescott to raise concerns about a £800m funding black hole.

Link: Council tax referendums on the cards

The LGA said the problem is acute and that council taxes would have to rise steeply to meet the shortfall unless the government came up with additional funding.

The LGA said there was a £300m shortfall in education and that police authorities were short by £200m. New responsibilities in social services, licensing and the environment would bring the total funding gap to £800m, the LGA said.

LGA chairman Sir Jeremy Beecham: ‘The problem for this coming year is the perception that council tax levels have already reached the heights of acceptability, but most councils have nowhere else to go to raise income. We are working closely with the government to find a long-term solution to this problem, through the balance of funding review. But this won’t fix next year’s council tax levels and spending needs.’

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