ST HELENS Borough Council cabinet has approved plans to increase council tax by 4.99 per cent in 2021/22.

Cabinet members voted unanimously to approve the plans during a cabinet meeting on Wednesday, February 24, which will see residents face a 4.99 per cent increase this year, with a rise of 3.99 per cent for each subsequent year.

The proposed changes will mean an annual council tax bill of £1,578.78 will apply to Band D properties.

In 2020/21, a Band D property cost £1,503.75 – meaning the increase will cost the average property £75.03.

The cabinet also agreed there will be no change to the council tax reduction scheme until the next financial year, when the “full impact” of COVID-19 is known.

The council is allowed to increase council tax rates by 2 per cent each year according to the 2021/22 Local Government Finance Settlement.

Local authorities responsible for social care, like St Helens Borough Council, are additionally permitted to raise the Adult Social Care Precept up to 3 per cent each year, making it possible for council tax to rise by 5 per cent in total without holding a referendum.

In that vein, the council aims to increase council tax rates by 1.99 per cent, with the additional 3 per cent to cover the Social Care Precept.

In published plans, the council says it “recognises the impact that council tax has on local residents and will always take their ability to pay into consideration when setting council tax levels”.

It will also “provide support to ensure that entitlements to Local Tax Reduction are maximised”.

It adds that the financial impact of foregoing such an increase would equate to £3.9 million.

The increase comes as mounting pressures from COVID-19 put further strain on local services. The plans take into account the “exceptional” deficit created by the pandemic, along with assumed National Living Wage increases of 2.2 per cent in both 2022/23 and 2023/24.

St Helens Borough Council’s potential funding gap – the amount of money needed to fund ongoing services which is not currently covered with cash, equity or debt – accounts for ongoing pandemic pressures, such as more people being eligible for council tax reductions due to COVID-19’s financial impact.

The rise will also combat the “significant reductions” in central Government funding St Helens Borough Council receives.

Council Leader David Baines said that the council’s core funding has dropped from £127 million in 2010 to just £12 million in 2020.

Speaking to the LDRS in December, he said the authority was working on “drastic” proposals to cut £20 million from its budget.

Even with an expected council tax rise, Cllr Baines said the funding gap threatens closures and cuts to services.

Libraries, leisure services, children’s centres, waste and recycling, highways maintenance and more are all under threat, he said.

During today’s meeting, Cllr Martin Bond added: “We cannot shy away from the financial situation we as a council find ourselves in at this moment in time. Set amid a backdrop of the once in a generation impact that the Covid-19 pandemic has had on our borough and the demand for support means we need to make fundamental changes to services and how we as a council work with others.”

The cabinet also voted unanimously to approve plans for capital spending, including the plans to refurbish and reopen the Gamble building and Earlestown Town Hall.

The plans will now proceed to a full council meeting on Wednesday, March 3.