Croydon approves council tax rise of 15%

A controversial council tax increase of 15% has finally been approved at Croydon Council.

Labour, Green and Liberal Democrat councillors rejected the first proposal on 2 March.

Invited to submit alternative budgets, the administration is legally obliged to come to an agreement by 11 March.

In Wednesday's budget meeting, no more proposals were submitted and the opposition initially voted down the mayor's budget for a second time.

But after stern warnings that the failure to set a budget would cost the authority millions of pounds more and be unlawful, the vote was passed after a second vote in the same meeting.

There were 34 votes for, three against and 33 abstentions.

Last month the struggling authority was given special permission by the government to make the increase without holding a referendum - usually a requirement for a council seeking to impose an increase of 5% or more.

The 15% rise means that the average household in Croydon will pay an extra £235 a year, taking bills to over £2,000.

Labour said at Wednesday's meeting that the plan had been "kept a secret" until the last moment and that they had only been given two days to come up with an alternative.

Labour leader Stuart King said the mayor, Jason Perry, had been "conniving with the government to deny residents a referendum".

Mr Perry said that in terms of other viable options, "frankly there are none".

He said the authority was in the "worst financial position in local government history".

After the budget was defeated for a second time in Wednesday's first vote, corporate director of resources, Jane West, said that a failure to come to an agreement before 11 March meant not only that the authority would lose a further £20m a month in unpaid council taxes, but, as it is a statutory requirement, individual councillors could be legally liable for not setting a budget.

Mr Perry told the BBC earlier on Wednesday: "What we're saying to opposition is that they've had the opportunity to bring alternate budgets and no other proposals have been brought forward. There is only one budget on the table and that is the one that we will be voting on tonight."

Asked whether a smaller increase was a viable option, he responded that the "budget will not balance".

He added: "We'd have to cut services or borrow more money. There's no alternatives; this isn't a decision that 's been taken lightly. It's not a decision that I'd like to be making but it's the reality of where we are in Croydon.

"If we don't have this 15% increase we're looking at potentially another £20m worth of cuts for next year on top of £36m of savings already taken from the budget and it could add another £66m of borrowing over the next three-year period."

He added that the authority had a council tax support scheme and was introducing a hardship fund for those unable to pay.

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