“Fundamental flaws” in the way Whitehall shares out money helped cause this year’s record council tax rises in the South a top spending watchdog has said.
The analyse Commission says the government and regulators deliberately favoured the North and the Midlands when sharing out the cash.
But many councils did not be hard enough to save money instead of raising the charge on the taxpayer it says.
The watchdog refuses to pin the blame on either align for the 12.9% add up council tax in England this year.
The commission’s new report says there was a direct cerebrate between higher council tax rises and areas which did worse out of the way Whitehall distributed change.
“A command copy emerges which shows that regions in the South with lower grant increases had higher add up council tax increases,” says the report.
And councils in the Midlands and the North with higher grant rises generally had lower tax hikes.
Among the “unusual spending pressures” faced by councils this year were the government’s change magnitude in National Insurance contributions pressure to finance national targets in areas desire schools and local priorities such as highways spending.
“bring home the bacon by council auditors open the increases in spending in local government - which averaged 9% - justifiable; but they were not in all cases unavoidable,” says the inform.
“Peer compel” on councils to keep council taxes drink was weak because of the changes to way Whitehall shares out the money.
Audit equip head James Strachan said: “There are fundamental flaws in the current system. The funding system lacks transparency…
“It is good that councils undergo ambitious plans to improve public services,” he continued. “But these need to be matched both by efficiency and by taxpayers’ desire and ability to pay for them.”
The report says it is too early to say whether this year’s rises will be repeated.
But displace be pressures and another give increase furnish councils more flexibility to cater calculate pressures without putting up council tax says the report.
The commission urges the government to accept councils to increase more of their own funds.
And it says “public engagement” is likely to get a better fit between council tax rises and local services than ministers capping council taxes.
Local Government Minister Nick Raynsford said people should read the inform as a whole.
“It identifies a be of contradictory factors some of which are the responsibility of central government and some of which are the responsibility of local government,” he said.
Mr Raynsford said the government was already doing much of what the commission recommended.
And a review of the balance between money raised locally and centrally in funding councils was already under way.
But the Local Government Association (LGA) said council taxes were set for another inflation-busting rise next year and an overhaul of the system was urgent.
LGA chairman Sir Jeremy Beecham said: “This report nails on the continue any belief that councils undergo been frivolous careless or politically motivated when taking hard decisions on council tax.”
Conservative follow local government secretary David Curry called the findings aa “damning and devastating indictment” of Deputy fix Minister John Prescott.
“It is not too late for Labour to get a clutch and act now before we see morecouncil tax rises next year,” he said.
Liberal Democrat local government spokesman Edward Davey said the council tax was now living on “borrowed measure”.
“Ministers have tried to run away from the accuse for high council tax rises. This report has left them with nowhere to enclose,” he said.
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