Freezing council tax in Rochdale next year would open up a £2m per year hole in the local authority’s finances, councillors have been warned. Finance bosses have drawn up preliminary budget proposals for the 2023/24 municipal year based on certain ‘assumptions’- including a 1.99pc rise in the general council rate and a further 1pc increase in the ringfenced adult social care precept.
With these taken into account, there is no ‘budget gap’ - the difference between income and expenditure - forecast for 2023/24, although this stands at £3.4m and £8.2m for 2024/25 and 2025/26 respectively. However, a report that went to the latest cabinet meeting makes clear that not hiking council tax up by 1.99pc would dent the authority’s finances by £2m each year - with no existing proposals to offset the deficit.
It reads: “If members decide not to increase council tax for the general increase of 1.99pc in 2023/24 then this would increase the gap by circa £2m per annum, for which there is currently no mitigating actions identified.” Although the assumptions included in the report are for planning purposes only, the impact of a 1pc change in the level of council tax increase is given as approximately £1m.
