Proposal to increase Liverpool council tax by maximum amount passes final hurdle

A proposed 5% hike in council tax for Liverpool residents has cleared its latest hurdle.

As the city council makes plans for the next financial year, a series of recommendations to set a balanced budget have been put forward by its executive team. Members of the cabinet met at Liverpool Town Hall on Tuesday where they formally backed a course of action which would include raising council tax by the maximum amount available for 2024/25.

The proposals, described as the “professional things to do” by council leader Liam Robinson, will now go before the full 85 member authority next month for final ratification.

The next 12 months marks the second of a three year process for Liverpool Council to close a financial black hole of £85m. Despite more than half of the shortfall being delivered in the current financial year, the city council is still seeking to make tens of millions of pounds in savings this year. 

Local authorities are required to seek approval via a referendum for council tax increases at or above a specified threshold, this was set at 5% for 2024/25. The majority of this can be used for any services, with an additional 2% solely to address the continuing adult social care pressures.

An increase of 4.99% in 2024/25 would equate to an additional £64.81 per year or £1.25 per week for a Band A property. For a band B property, it would equate to £75.60 per year – £1.45 per week.

However, the proposed total revenue generated through council tax in the next financial year – £235m – would potentially be outstripped by the bill the authority faces to fund adult social care during the same period – £247m.

In outlining why the council would seek to raise the rates for households at the highest amount for the second year running, Cllr Ruth Bennett, cabinet member for finance and resources, said the budget was “based on the priorities of Liverpool” and “various financial pressures had been considered including budget pressures and high interest rates.”

Cllr Bennett said the council was working towards “prudent financial stewardship” to provide “value for money for our residents.” 

Cllr Liam Robinson, leader of Liverpool Council, said the budget proposals were “not just the right things to do, but the professional things to do.” The Labour group chief said the plans were an example of “how hard the council is working.”

Pointing the blame at the UK government, Cllr Robinson added how aid the “economic turmoil unleashed on us”  had made it more difficult to pay for vital services. He said the council “should never lose sight of how difficult it is to achieve a balanced budget.”

The cabinet budget plans will now go forward to a special budget meeting of the full council on March 6.