A Reform-led council is one of a number across England granted special permission to hike council tax rates by a cap-busting nine per cent, as part of plans to ease a “challenging financial position”.
The agreement is part of a three-year settlement for local authorities which the Government has finalised.
It comes after The i Paper revealed at least 11 councils might need to hike council tax beyond five per cent from April.
Local government minister Alison McGovern said the deal, which will make around £78bn available to town halls throughout England, was designed around “reconnecting funding with need”.
However Steven Broadbent, the County Councils Network (CCN) finance spokesman, warned the next three years “will be very challenging” for the organisation’s members.
Most councils can raise their share of a tax bill by up to five per cent – and must ask for residents’ permission in a referendum before hiking it further.
However seven councils have been allowed to raise it beyond that, including Bournemouth, Christchurch and Poole Council, which can raise its share by up to 6.75%.
Authorities in Trafford, Warrington and Windsor and Maidenhead can raise their share by up to 7.5%.
But Shropshire, Worcestershire and North Somerset councils can raise their share by a maximum nine per cent.
Worcestershire County Council, which is led by Reform UK, has faced a shortfall of £70m.
Reform’s leadership had set up a Doge-style role in its cabinet to look at ways to cut spending but previously said it was considering increasing council tax by up to 10 per cent.
Earlier this year Councillor Rob Wharton, Cabinet Member for Finance, said: “Even with a 5 per cent rise, Worcestershire remains among the lowest council tax areas nationally.”
Many Reform-run councils were expected to have to increase council tax, despite their councillors previously railing against higher taxes.
The Government’s package will include a £440m uplift to the recovery grant, “aimed at the councils most impacted by cuts during austerity”.
It will also include £272m additional allocations within the homelessness, rough sleeping and domestic abuse grant, bringing its total to £2.7bn.
“Our local government finance reforms get money to where it is needed, but we recognise that some councils remain in a challenging financial position as they continue to deal with the legacy of the previous system,” McGovern said in her written statement.
She added: “Only around a third of councils were given the funding to broadly match their assessed need before our reforms.
“By the end of the multi-year settlement, that will be nine in 10 councils.
“As a result of these changes, the most deprived places will receive 45% more funding per head than the least deprived in 2028/29.”
But Broadbent, who is the Conservative leader of Buckinghamshire Council, said he was “disappointed” that “ministers have chosen to yet again unfairly target even more resources on a select cohort of urban and metropolitan councils”.
“This shows that today’s decision to increase the recovery grant by a further £440m, rather than providing extra funding to all county and unitary councils, is patently unfair and compounds the decision to downgrade remoteness within the formula.”
Jeremy Newmark, the District Councils’ Network finance spokesman, said “the funding redistribution in the final settlement has created winners and losers”.
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Newmark, the Labour leader of Hertsmere Borough Council, added: “It is clear that district and unitary councils, especially in more remote and rural areas, will struggle to preserve the full range of services that residents need and value.
“The transitional funding protection is welcome but for many districts, the settlement still amounts to a real-terms reduction in core spending power.
“That is why we will be asking Government to act beyond the finance settlement to help councils support themselves and continue delivering high-quality services.”
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