Published 17th December 2018
The Government has announced its draft Local Government Financial Settlement for 2019/20 which includes the welcome news that council referendum principles will not be applied to English towns and parishes. This honours its announcement in February that referendum principles would be deferred for three years, but the Government says this is subject to it seeing clear evidence of constraint in setting council tax increases.
County Councils and Unitary Authorities will be permitted increases of 3% before the principles apply and district councils in two-tier areas will be allowed increases of up to 3%, or up to and including £5, whichever is higher.
The full text of the draft Settlement says:
“In 2018-19, the Government decided to defer the setting of referendum principles for town and parish councils for three years. However, this was conditional upon:
• the sector taking all available steps to mitigate the need for council tax increases, including the use of reserves where they are not already earmarked for other uses or for “invest to save” projects which will lower ongoing costs; and
• the Government seeing clear evidence of restraint in the increases set by the sector. 3.2.7 In 2018-19, the average band D parish precept increased by 4.9% (£3.02). This compares to a 6.3% increase (£3.63) in 2017-18 and is the lowest year-on-year increase in parish precepts since 2015-16.
The Government has decided to continue the deferral of setting referendum principles for town and parish councils subject to the conditions above, but encourages parish councils to continue this downward trend, and will keep this area under active review.”
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