Croydon Council has approved a 4.99% council tax increase as part of its budget for this year. This increase, approved at a meeting on Wednesday, means council tax is at its highest-ever level for the borough.
Despite council-wide concerns around the viability of council tax, the Conservative Council thought it essential to include it to provide a balanced budget. It also forms part of the council’s plan to address the £1.4 billion of debt currently hanging over it.
In his speech to the chamber, Mayor Jason Perry said: “Shockingly, we spend £62 million, equivalent to 11 pence in every pound servicing the £1.4 billion debt which was run up by the previous administration. It was their mismanagement, poor investments and overspends, which make it our third largest expenditure.”
The budget also proposed £141 million to support vulnerable adults, while £98 million will go to supporting children, young people & their education. These two represent the council’s largest and second-largest expenditures respectively.
The budget, which must be balanced every year by law, was due to be approved last Wednesday (February 28). However, the rejection of amendments made by the Labour and Green groups meant councillors had to return a week later to set a budget.
The Labour group, who abstained from Wednesday’s vote, criticised the Mayor’s budget as being ‘unfair’ to Croydon residents. Speaking to the local democracy reporting service (LDRS), Labour’s leader of the opposition, Stuart King said: “Croydon’s Conservative Mayor is raising council tax by the maximum amount.
“On his watch council tax in Croydon is now at its highest level ever as he looks to force through what will amount to a 20 per cent increase in council tax in his two years as Mayor.
“All of this on top of £30 million of cuts to services – from library closures to millions less in hardship payments to families hit by his own Government’s cost of living crisis. Thanks to Croydon Conservatives residents are paying more but getting less.”
Outside, on the steps of the town hall, protestors returned to express their dissatisfaction with the council tax increase and general governance of the borough. David White, a TUC member who led the pre-budget protest last week, told the LDRS of his concerns regarding the council’s budget.
He said: “The budget means that once again Croydon residents are paying more and getting less. Council tax will rise by a further 4.99 per cent, following a 15 per cent rise last year. Council services and jobs will be further cut. Any of the council’s landholdings and other assets which can be sold will be sold, probably at bargain prices.
“Despite all this Croydon will not in the longer term be able to balance its books. This is because of the large amount of interest it has to pay on its borrowings. 20p of every £1 that residents pay in council tax already goes into interest payments.
“The only answer is for the Government to fund Croydon more fairly and pay off a large proportion of Croydon’s accumulated debt. Mayor Perry says he has been trying to get a government agreement for a debt write-off.
“But for two years he has failed to do this. I don’t believe his heart is in it. Fundamentally he supports the Tory Government’s mission to drive down the public sector.
“Croydon TUC is disgusted by Croydon’s Tories who have brought in this budget and by Labour’s acquiescence in it. There is a huge disconnect between the views of most of Croydon’s councillors and what the public want.”
In his official statement, Perry said: “As Mayor I promised to fix the Council’s finances and restore pride in our borough. In their recent letter, the Government has said that Croydon is making good progress, and that we have ‘stepped up a gear’. We have set a budget for 2024/25 that builds on this.
“Local authorities are facing huge challenges – from rising demand for services, to cost of living pressures. In Croydon, these are compounded by the dire financial situation I inherited and the Council’s £1.4bn debt burden. This debt will cost the Council £62m this year and is our third highest spend after adults and children’s social care.
“Despite these challenges, we are listening to our residents, and we are tightly managing the parts of our budget that are within our control. Croydon is the only council in government intervention that has not been taken over by government commissioners, and unlike most is not raising council tax above the limit this year.
“The Council still needs to make changes, but we have achieved much. I am determined that we will become a Council that provides value for every penny of taxpayers’ money that we spend, and a Croydon of which we can all be proud.”
Before voting on the budget, Perry also announced the council had secured a £53.8 million grant for the Regina Road redevelopment. This grant from the Mayor of London will allow for the demolition and eventual rebuild of controversial high-rise flats.
