Cost of living in Sheffield: Reason for optimism in 2018

After Sheffield Council approved the most expensive council tax it has ever set, Sam Cooper takes a look at what 2018 has in store for people in the Steel City.

By The Newsroom
Thursday, 15th March 2018, 1:23 pm
Updated Thursday, 15th March 2018, 1:30 pm
What will 2018 mean for the cost of living in Sheffield?
What will 2018 mean for the cost of living in Sheffield?

Rising council tax bills, cost of fuel at its highest for almost four years and water rates due to increase by more than 3 per cent - the purse strings of people in Sheffield couldn't be much tighter.

But there is light at the end of the tunnel - that's the message from economic leaders as the city looks to crawl its way out of austerity and towards prosperity.

Sheffield Council approved the maximum permitted 5.99 per cent rise in council tax at its budget meeting earlier this month, which leader Julie Dore said was a 'difficult decision because the authority knew many residents were struggling'.

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The rise will add just over £57 a year - or around £1.10 a week - to the bill from April for households in band A properties, which account for around 60 per cent of homes within the city.

Prof John Singleton, Professor of economic and business history at Sheffield Hallam University, said: "5.99 per cent is almost twice the current rate of inflation so that's certainly going to make things worse for people.

"The Bank of England is expecting inflation to fall this year back towards two per cent so that council tax increase is going to be even bigger relative to other costs."

But Prof Singleton added there was reason for optimism, with wages expected to rise by up to two per cent this year.

"I think Sheffield is a relatively poor place but the cost of living is also lower than other areas and that would be particularly the case when looking at housing costs," he said.

"Housing costs in Manchester will be much more and that's a huge advantage Sheffield has over other parts of the country. I suspect 2018 will be much better for people in Sheffield."

Speaking during a Cabinet meeting to discuss the 2018/2019 budget and council tax increase, Coun Dore said: "This is the highest council tax that we have set and it's always difficult for us to increase council tax because we know that there are many residents struggling.

"The cost of living crisis is not in real terms being seen in households in Sheffield. We know that wages are not rising as high as inflation.

"Putting up council tax is not easy but we find it necessary because we know that those who are struggling would struggle more if we didn't do it. We are reluctant to put it up but we feel we are forced into it."

The increase consists of three per cent for the social care precept and a 2.99 per cent general rise, which is the maximum amount allowed by the Government without a referendum being required.

An extra £8 per year year is also being asked for to pay for policing, and the Fire Authority will increase its precept by 2.97 per cent.

The council's share of the tax for a band A property for 2018/19 would stand at £1009.28 under the proposals - up from £952.24 this year.

For a band D property, which is widely used as the barometer for council tax nationally, the council's share would rise from £1,428.36 this year to £1,513.92 for 2018/19.