Warwickshire residents could be facing a council tax rise - here's why

Some capital projects planned over the next five year might also have to be scrapped due to the challenging economy

Soaring inflation is set to prompt a council tax rise across Warwickshire according to the person tasked with holding the county council’s purse strings.

And he explained that certain capital projects planned over the next five years might have to be scrapped as costs continue to rocket.

Cllr Peter Butlin (Con, Admirals and Cawston), the portfolio holder for finance and property, outlined the issues during cabinet meeting on Thursday (July 14) during a discussion on the refreshing of the council’s medium term financial strategy.

Soaring inflation is set to prompt a council tax rise across Warwickshire according to the person tasked with holding the county council’s purse strings. Photo by Alex Green

A report prepared for the meeting explained some of the financial pressures faced.

It said: “The context in which the 2023/24 refresh is happening has moved on from being dominated by Covid.

"Instead this has been replaced by a fundamental financial uncertainty around the current inflationary pressures and the consequent impact on both the cost of service we deliver and the demand for services as households and communities struggle with the rising cost of living.

“Added to this are significant uncertainties around government policy and the timing of any changes in terms of local government funding reforms.

"As a consequence, the economic situation remains hugely challenging, with the direct and indirect impacts of all these factors on the county council as well as our partners both unknown and highly volatile at this stage.”

Cllr Butlin asked the cabinet to agree to a series of principles to help with forward planning including a likely council tax increase and the need to prioritise which capital projects could proceed.

He said: “A few years ago we set a five-year medium term financial strategy and shortly after, Covid struck and we had to refresh it and rewrite it. Now the MTFS has been buffeted by further events, notably inflation.

“Inflation basically means we are getting less for our money. It has pushed towards 9.1 per cent and affects the way we have to allocate funds towards salaries, capital projects and the way we deliver services.

“Our projects involving bricks, mortar and Tarmac have seen inflation rates far in excess of 9.1 per cent which means we will have to rethink some of those projects.”

On the subject of council tax rises, Cllr Andy Crump (Con, Southam, Stockton and Napton) said: “It is a bit of a dilemma, recognising that household budgets are under severe pressure and any council tax increase won’t be particularly welcome.

"But you have to make sure you have enough resources to provide the essential services.”

Cllr Butlin added: “It was laid out in last year’s budget where council tax increases were heading – a 2 per cent increase and a 1 per cent precept on adult social care. We are not anticipating going above that which is a ceiling set by government,

“It is a balancing act. I like to be cautious and if things turn out better then we can reflect that when we set the council tax.”