🙏 Council Tax Reform

• Council Tax Unfairness Highlighted: Mr Jonathan Brash (Labour, Hartlepool) argues that council tax is the most regressive and unfair tax in the UK, disproportionately affecting poorer areas like Hartlepool. He compares the annual council tax on a Band A property in Westminster (£648) to one in Hartlepool (£1,585), highlighting the inequality.

• Regional Funding Disparities: Richard Foord (Liberal Democrat, Honiton and Sidmouth) points out that London boroughs receive significantly more settlement funding than shire counties, adding to the burden of council tax on poorer areas.

• Outdated System: The current council tax system is based on property valuations from 1991, which Brash argues cannot deliver fairness and has worsened regional inequalities.

• Impact on Social Care: A large portion of local council budgets, like Hartlepool’s, is spent on social care. Brash notes that the system forces local authorities to choose between protecting vulnerable residents and increasing council tax.

• Transparency and Trust: Jim Shannon (DUP, Strangford) calls for greater transparency in how council tax is spent, arguing it’s crucial during the cost of living crisis to maintain public trust.

• Alternatives Proposed: Suggestions for reform include a proportional property tax, as advocated by Andrew Dixon and the Fairer Share campaign, potentially benefiting 70% of households in the north-east.

• Government Response: The Minister for Local Government and English Devolution, Jim McMahon, acknowledges the issues with council tax but confirms no revaluation or reform plans in this Parliament. Instead, the government aims to address funding discrepancies through a multi-year settlement in 2026-27.

• Funding Reforms: The government plans to update the funding formula to better account for differing abilities to raise council tax revenue across regions, aiming for a fairer distribution.

• Local Challenges: Sarah Dyke (Liberal Democrat, Glastonbury and Somerton) highlights the strain on councils like Somerset due to past decisions and emphasizes the need for a reform timetable to help councils plan.

• Council Tax Collection: Despite its flaws, council tax is noted for its high collection rate and local retention, which provides some financial predictability and control to local authorities.

The session on Council Tax Reform exhibited a low level of disagreement, primarily characterized by a unanimous call for reform from all speakers. The disagreements that arose were minor and focused on specific aspects of the issue, rather than fundamental opposition to the overarching goal of reforming council tax.

Examples of minor disagreements or areas of differing emphasis include:

1. Richard Foord’s intervention on the unequal settlement funding for councils, which Mr Brash acknowledged but did not directly dispute, indicating a shared concern rather than disagreement.

2. Sarah Dyke’s query on the timing of reform due to local budgetary pressures was met with a response from Jim McMahon acknowledging the urgency but also indicating the complexity and fragility of the system, which suggests more a difference in approach and timing than in the actual objective.

3. Richard Foord’s point on the impact of reduced settlement funding on road maintenance in shire counties was acknowledged by Jim McMahon, who expanded the issue to a national level but did not dispute the specific concern, showing a shared recognition of the problem but different scales of focus.

4. Grahame Morris’s challenge about the regressive nature of council tax was met with agreement from Jim McMahon, who further elaborated on the issues without contesting the fact itself, indicating a consensus on the problem but differing views on its broader implications.

Overall, the session was dominated by a shared acknowledgement of the need for reform, with speakers from different parties contributing to a unified narrative rather than engaging in substantive disagreements. The rating of 1 reflects this near-total absence of significant disagreement.