AVDC to consider government’s council tax offer

Archived press release

Date Published: 23/01/12

High Street offices

Aylesbury Vale District Council is set to consider whether to take government cash to keep council tax frozen – but then have to face bigger savings in the future.

The authority, like others in the UK, has been offered a one-off grant to keep tax frozen in 2012/13 – equal to a 2.5 per cent increase.

But freezing the bills means services could be harder hit in the future as the council would not be able to recover the loss of potential income in future years.

Councillor Neil Blake, Cabinet Member for Resources, said: “The government has offered councils across the country a one-year grant to allow council tax levels to remain frozen for 2012/13. If we choose to maintain our council tax level at the same as the current year, we will receive a single grant payment equivalent to a 2.5 per cent increase.

“Last year the government asked councils not to increase council tax and provided councils with the additional funding to allow us to do this. This year the offer is different as it is for one year only. If we accept the grant and freeze council tax, we would have to increase council tax by 2.5 per cent the year after (2013/14) just to replace the grant plus a further 2.5 per cent to help cover inflation. This would, almost certainly, fall foul of the government’s council tax capping policy and would jeopardise the continued provision of existing services.”

A 2.5 per cent rise in the authority’s precept means the portion of the council tax that will be paid to the district council would increase from £131.07 per Band D property to £134.35 – a 6p a week increase.

Although AVDC collects the council tax, it only keeps about 10 per cent of the total bill to pay for services such as refuse and recycling collections, planning, parks and street cleaning. The rest is passed to other service providers, such as the county council and police and fire services. This means that even if AVDC does accept the freeze grant, but the other authorities reject it, residents may still see an increase in their bills.

In developing a budget for the 2012/13 financial year, the council has had to find £2.6 million in savings from its £18 million revenue budget due to reduced government funding and pressures such as the increased cost of utilities (fuel and electricity). This saving is needed on top of the £1.2 million savings delivered to balance the 2011/12 budget. In 2013/14, the council will need to save at least another £800,000 to balance the books.

An array of saving solutions have been recommended by the cabinet to allow AVDC to have a balanced budget position for 2012/13.

The recommendations include:
• Reducing back-office costs with limited effect on front-line services, in a range of areas, saving £300,000
• Slimming down of management, with limited impact on front-line services, creating a saving
of £267,000
• Combining horticultural and street cleansing services from January 2013, which should result in ongoing savings of about £200,000 a year
• Replacing the council’s cash office services with new more convenient ways to pay bills, which will create a saving of around £50,000 per year

One of the ways in which the council can offset cuts is to increase its income, so some fees and charges for services are set to increase from 1 April. Modest increases are recommended on car parking charges in Aylesbury, Buckingham and Wendover to help minimise the impact of reduced government funding on key services.

The cabinet fully considered the comments made by the council’s scrutiny committees before making its final budget recommendations.

Full council will consider the 2012/13 budget and the government’s council tax freeze offer on 1 February.