Ministers face pressure to let struggling English local authorities raise council tax by up to 25% to prevent bankruptcy. With many councils unable to balance their finances, government approval to exceed the typical 4.99% increase limit seems inevitable. Current financial constraints affect councils across party lines, including Hampshire, Bradford, and Windsor and Maidenhead. Experts believe waiving the cap is the necessary option for the government to ensure councils remain operational, especially as a significant proportion of local authorities report deteriorating financial conditions since the last budget.
According to the County Councils Network, 85% of local authorities say they are in a worse position than before the autumn budget.
The government is bound to let some councils breach the 4.99% cap because it's the least worst option.
Ultimately, the government will have no choice but to agree the worst-hit councils raise council tax by more than the current limit.
When it becomes clear to local officials that they will be unable to balance the books, ministers can intervene and waive the rules.
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