Croydon Council 2023 Council Tax rise – Mayoral Statement

On Monday afternoon 6/2, the Department for Levelling Up, Housing and Communities (DLUHC) published the annual Local Government Settlement, setting out the funding that the Government will provide to all councils for the next financial year (2023/24).

As part of that settlement announcement, DLUHC sets the maximum level of council tax increase which is permitted, and for most councils in the country the cap is a 5% increase to council tax bills.

The Government has given permission to Croydon, Slough and Thurrock councils to increase council tax above the 5% cap; because of the seriousness of our financial situation, Croydon has been given permission to increase council tax by 15% rather than by the national 5% cap.

We know that this is very difficult news to bear, especially given the pressure that all households are under. Unfortunately, the scale of the financial problems in Croydon means that every possible option must be looked at to protect vital services, and the scale of Croydon’s problems means that there is no easy choice to make. Without this proposed increase the council would have make a further £20 million in savings, on top of the £36 million cuts that are already being extracted from the 2023/2024 budget.

The budget proposals will include plans to introduce a new hardship fund to support residents who are not eligible for Council Tax Support but who are finding it hard to make ends meet in these difficult times. A dedicated hub to help with the rising cost of living has also been set up on the council website.

A report will be published next Tuesday, 14 February 2023, and the proposed budget for 2023/24, which includes council tax levels, will be presented to Cabinet on 22 February 2023. The annual budget is due to be decided at the Full Council meeting on 1 March 2023.

A Statement From The Mayor Of Croydon

Jason Perry, Executive Mayor of Croydon, said: “The toxic £1.6bn debt and financial failures of the previous administration left Croydon with a hollowed-out council which has been reliant on government bailouts for multiple years.

“My focus since I was elected Mayor, has been on opening the books and taking the steps necessary to get the council back on a sustainable footing.“Given the scale of the financial collapse Croydon has experienced, getting back on track will require incredibly difficult decisions. That is why, as part of a wider package of support we are negotiating with the Government, they have given us permission to propose a one-off increase in council tax of 15% this year. This amounts to around an extra £4.50 a week, or 63p a day, for the average property.

“I know this is going to be difficult for people in Croydon, particularly when they face other pressures but without the proposed increase, the council would need to make a further £20m of additional cuts this year, putting vital services to vulnerable residents at risk. This would be on top of the £36m savings that have already been proposed for the coming year’s budget.

“As part of our Council Tax Support Scheme we also plan to increase the support we provide to low-income households, to protect those who cannot afford to pay their council tax.

“Alongside the Council Tax increase, we are in discussion with Government to agree a reduction in the council’s long-term debt and in the meantime we hope to agree a new Capitalisation Direction to address the historic financial failures which still sit on the council’s balance sheet. These steps, together with the continuing programme to transform how the council operates, are important and necessary steps to making Croydon a sustainable local authority.

“I remain committed to ensuring that those responsible for Croydon’s financial collapse are held to account for their failures.”