Town Hall pledges no council tax for poorest families by 2030 in ‘steady as she goes’ budget

The Town Hall has promised that 27,000 low or no-income families will pay no council tax at all by 2030, as part of what Hackney Mayor Philip Glanville is describing as a “steady as she goes” budget.

The move comes against a background of continued uncertainty at the council over what local government funding will look like in a year’s time, and alongside a “regrettable” increase in council tax by 3.99 per cent.

The Town Hall recently chose to reverse changes to its council tax reduction scheme which attracted widespread criticism in 2018, returning the amount the poorest residents paid from 17 per cent to its previous level of 15 per cent.

Mayor Glanville said: “We made a commitment to review this after two years. I think you could have made an argument to keep it at 17 per cent, but rather than revisiting some of the debates we had before, we felt it was right to set a political direction to a fully funded scheme.

“The challenges of getting there still remain, and we’re very clear about that. Where you’ve got boroughs who have fully funded their schemes, they have a far lower group of residents who are receiving the benefits, so the gap between what it would cost us and what it might cost a Camden or a Westminster is still greater.

“Without the impact of austerity and without the decisions of the coalition government, the over £25m we are spending on the scheme would have been properly funded by national government through a fair scheme for all residents in this country.”

The commitment has now been made for families to receive at least a 90 per cent discount by 2025/26, as work begins to review how to enact the proposals by exempting, for example, households with children or disabled people without single workless households slipping through the cracks.

The move is one of a number of budget moves aiming to safeguard Hackney’s poorest, with £500,000 earmarked for families in food poverty, as the council struggles with how to address a £19m funding gap from central government.

The gap is down from £30m last year, with the largest savings coming from a £6m voluntary redundancy scheme and workforce efficiencies within the Town Hall.

Other ideas now being looked at include a “fundamental shift” in the way the council’s fees and charges are set, with officers being encouraged to take into consideration “opportunities for income generation” when proposing or updating them.

The idea, recommended by the Budget Task & Finish Group, which also proposed last year’s new income band fee structure for children’s centres and an above-inflation hike in parking charges, will be baked into the budget for 2021.

A report on the shift reads: “Whilst keeping the ethos of public sector service provision is important, the Budget Task & Finish Group acknowledged the current climate means the council needs to consider the possibility of income generation.”

Apart from the City, Hackney has suffered from the highest per-head funding cut in London over the past decade, amounting to £1,500 per household.

Glanville added: “This is money, real money and resources out of the pockets of some of our poorest residents and those who rely on our services the most.

“Austerity has delivered a lost health decade, with life expectancy growth stalling for the first time in 100 years, with expectancy amongst poor women actually declining.”

The Mayor also repeated warnings of the financial hit the borough could sustain as a result of the government’s “so-called” fair funding review removing deprivation as a measure of how money is allocated.

He predicts it could push Hackney’s deficit back up to just under £40m.

In heated debates over the budget between Labour and Conservatives at last night’s full council meeting, the Mayor called on the opposition councillors to “stop playing games” and lobby central government to “speak up for Hackney” on the issue.

Cllr Simche Steinberger, speaking for the Conservative group, said: “The amount of things that are in this budget that are not right, that don’t add up at all, I could go on all day and night, I’m flabberghasted.

“We do not use the full potential to value the money that’s there. Before you started your consultation about collecting the rubbish, I chucked mine in the bin because I’m fed up of answering questions where I knew what the answer is.”

The rubbish consultation referred to is council proposals to reduce collections of black bag waste to fortnightly, which will up the borough’s recycling rate as well as mitigating the additional cost of the levy paid to the North London Waste Authority, which is increasing to over £12m as a result of the construction of a new incinerator at Edmonton.

In their alternative budget, Conservative councillors propose a reduction in planned highways maintenance investment by £2m, a review of the fortnightly bin collection plans, and the end of the publication of council freesheets Hackney Today and Hackney Life.

Other investments announced by Mayor Glanville’s administration include:

• £322m on capital projects, including London Fields Lido’s new learner pool, refurbishments of Stoke Newington and Stamford Hill libraries and Hackney Museum
• £17m investment in parks and green spaces over the next three to four years, including Abeny Park Cemtery, Daubeney Fields, Springfield Park, Fairchilds Garden, and Shoreditch Park
• £7.3m into progammes on community safety, with £1m for expanded CCTV in Shoreditch
• £1.6m into children and family services following an Ofsted report finding the council service required improvement
• £500,000 for poorest residents in a scheme providing access to healthy food

Challenges remain for the Town Hall over its lack of certainty for sustainable funding for its adult social care services and for children with special education needs (SEND), with central government allocating only one-off funding for the former and £4m for the latter – half what is required to bridge the gap.

Glanville added: “The challenge that still awaits is we have a one-year funding settlement. When it comes to what happens next, the reason this is a ‘steady as she goes’ budget is because we don’t know. You can’t decide to maintain or invest in services, or if you need to really reconfigure services if austerity is going to bite.

“There were parts of last year where we did not know what the final settlement would be. Take a ring-fenced grant like public health – we were expecting a decline in funding, but in the end the government maintained it while it is projected out as if the cut will happen again next year.

“It’s a real challenge if you’re commissioning really important services and where to go next. Two or three year commissions are common to give people certainty.”