Council tax Sheffield: How much your bills could rise by and when it could happen

It has been warned that council tax in Sheffield could rise by up to five per cent a year for the next three years.

Monday, 11th October 2021, 10:16 am

The concerns come as the UK faces problems with keeping vital services running and paying for social care reforms.

Local councils are also struggling to find sources of income in light of the pressures of the Covid-19 pandemic.

Institute for Fiscal Studies (IFS) think tank has said council tax in England could now rise by as much as £220 per year, in a bid to raise the cash needed.

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Since the start of the Covid crisis the Government says it has pledged £12bn to councils like Sheffield, but according to IFS the current spending plans mean council tax bills would have to increase by at least 3.6 per cent a year to get back to levels similar to those before the pandemic.

However this is just a minimum amount – with the actual figure more likely to be around five per cent.

But what does that mean for people in Sheffield? This is everything you need to know.

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Will my council tax bills rise in Sheffield?

It has not yet been confirmed if council tax will rise in Sheffield, or how much it will rise by, but it is reassessed every financial year so the current figure is always subject to change.

The cost of local services and the amount of money the council has had to spend on supporting people in the area are factors in the decision on whether or not to increase the charge – as well as the impact coronavirus has had.

The council’s financial year renews on April 30, which is when any changes would come into force.

This year, Sheffield City Council increased its council tax and social care precept by 4.99 per cent – the maximum rise permitted by the Government.

The increase came in a bid to provide £6.6 million towards social care services in the certain, which the authority said were under immense pressure after a difficult year.

A number of other local authorities refused to increase council tax bills to the maximum amount and instead used their general reserves to try and balance their budgets, but this was not the case in Sheffield.

According to IFS, Sheffield City Council will have to raise the price of council tax once again next year – by up to five per cent – to cover the current funding issues.

This means council tax bills in Sheffield could rise by between £160 to £220 by 2024/25.

When could my council tax bill rise in Sheffield?

Sheffield City Council begins its financial year on April 30, which is when any changes could begin to come into force.

When the authority was debating the changes this year, it announced a consultation period in January for residents to have their say on the increase before it went ahead.

The current price is fixed until the end of the financial year.

What impact could a council tax rise have in Sheffield?

The warning comes in a pre-released chapter of the IFS green budget. The rest of the budget will be launched closer to the planned Budget and spending review later this year.

Kate Ogden, a research economist at IFS and an author of the chapter, said: “The Government has stepped up with billions in additional funding for councils to support them through the last 18 months, it is likely to have to find billions more for councils over the next couple of years if they are to avoid cutting back on services, even if they increase council tax by 4% a year or more.

“The coming financial year is likely to be especially tough, with the likelihood of at least some ongoing Covid-19-related pressures, and a particularly tight overall spending envelope pencilled in.

“At the same time, government needs urgently to deal with a local government funding system which is becoming hopelessly out of date, being based on population levels and characteristics in 2013.

“This results in manifest unfairnesses in the distribution of resources between councils.”

A Government spokesperson added: “The Government has allocated more than £12 billion directly to councils since the start of the pandemic – with more than £6 billion available to spend as they see fit – recognising that councils are best placed to deal with local issues.

“We have also taken historic action to fix the social care crisis – the Health and Social Care Levy will raise £12 billion a year to fund the NHS and social care.

“The Spending Review will continue to focus on supporting jobs and delivering the public’s key priorities.”