Council tax increases by 4.99 per cent amid squabble over ‘fantasy budgets’

Camden Town Hall.

The Town Hall has passed its budget for the year, with an increase of council tax by the maximum possible level of 4.99 per cent, amid heated debate that saw accusations of “fantasy” thrown around between opposition parties.

The rate rise comes with a further £8.3m of additional savings, with all directorates at the Town Hall expected to consider whether any new recruitment can be suspended, delayed or stopped to control costs.

The council’s Labour administration will also bring forward a number of investments, including £1.5m for employment support and £270k to address violent crime and drugs.

There is also further spending on sustainability to help carry out the recommendations of the citizens’ assembly on the climate crisis, and £570,000 to fund two teams of community presence officers and outreach workers to tackle homelessness.

Finance chief Cllr Richard Olszewski said: “The budget is fully in line with every other budget that this Labour council has set, namely that its priorities are about supporting our people and communities, and in particular because of the events of the past year, it’s about supporting everyone to help them get through the pandemic.

“We have worked tirelessly to keep vital services operating, to ensure that no council tenant loses their home due to Covid, and we did our best to apply pressure so that no private sector would either. We also worked full pelt to ensure that everyone had access to food and other essentials they needed.

“We are in the third year of a medium-term financial strategy (MTFS), which is having to achieve savings of £30m on top of a £9m gap that the government has left us in Covid funding. It is because we have a three-year MTFS that we had a strong base to deal with the pandemic.”

According to Olszewski, 89 per cent of government support is predicated on raising council tax by the maximum amount, meaning that they have “little choice” but to do so, with the Town Hall nevertheless expecting a reduction in income from the tax of £5.9m, or 4.9 per cent, on a like-for-like basis when compared to the 2019/20 budget.

The Conservative group’s budget amendments saw a range of suggestions for savings in the council, including the introduction of ‘robot bins’ using solar power to compact waste, a trial scheme to charge utility companies up to £2,500 a day to carry out roadworks, and the cutting of the Town Hall’s external communications department by 50 per cent.

Conservative Cllr Andrew Parkinson said: “In the last year, coronavirus has had a huge impact on our communities and the economy. Our bounce-back budget amendment would enable us to build back a cleaner, greener and safer Camden.

“Using the backroom savings this amendment would secure, we would be able to put additional money where it is needed for catch up learning revitalising our high streets and restoring residents’ wellbeing.

“Our local high streets also need all the help they can get. The streateries established last year meant the difference between life and death for so many of our cafes and restaurants, but were solely reliant on third-party funding.

“The council itself contributed zero pounds to their success. We will fund the creation of six more streateries, creating much-needed support during the crucial summer months.”

The Tories’ amendments, which were rejected by Labour councillors at the meeting, also called for the opening of police bases in Hampstead and Swiss Cottage – criticised by Labour, who pointed to their closure as the doing of the Conservative central government – and a reduction of the proposed council tax increase by one per cent and putting the extra into reserves.

Both Liberal Democrats and Conservatives criticised each others’ submissions as “fantasy budgets with no merit” and “never-never land budgets” respectively, with the second opposition group’s amendments calling for the use of reserves rather than their retention, with £2.8m in earmarked cash to be spent on Covid support and recovery.

Liberal Democrat group leader Cllr Luisa Porritt said: “The past year has been incredibly tough for communities across Camden. Though we are all pleased to see vaccinations rolled out, the consequent economic crisis threatens to linger for much longer.

“The action we take now will determine how strongly our community will recover. So it is disappointing that the budget by the Labour Party holds on to excessive reserves that could be spent on the things that matter to Camden residents, yet maintains investment in a number of talking shops.

“The time for action locally is now. This Liberal Democrat plan to take Camden forward is full of the urgent action Camden needs to kickstart its recovery.”

The amendment proposed by Porritt would have seen funding for youth safety services, with the group pointing to the “deep cuts” of £629,600 in savings coming out of the budget in this area, which they said should instead be an investment of £573k into direct recruitment and more youth officers.

Green Cllr Sian Berry abstained across the board on the amendments, while criticising government for not giving the council the ability to plan ahead for more than a year with a short-term funding settlement.

Berry said: : “Of the two opposition amendments, the Liberal Democrat budget amendment is quite well thought out and well worth looking at, particularly the extra wages for Kickstart, the investment in youth homelessness, and freezing council allowances for one year and the use of reserves.

“If you are going to take money out of reserves, putting it in for just one year is not as good value as if you spread it out over several years, particularly in youth work.

“Overall the savings by the Conservatives are entirely speculative – that really does tip it over into fantasy territory, and I do object to trying to make money by filling our estates with parked cars.”

Responding to the amendments, Olszewski said: “The Tories’ amendment is more of the same. I double-checked that they’d changed the year at the top of their paper, and they’ve got that bit right.

“It’s just more of the political antagonism towards the public sector – wanting to slash upwards of half the budget for our strategy and communications departments, when both are crucial not just to the running of the council but to how we have dealt with the pandemic.

“The Liberal Democrats amendment has elements in it which we are not necessarily hostile to, but financing it on the basis of one year’s use of reserves is not really an appropriate way to approach public services.”

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