City Council Tax increase reduced to 2%

11.35.31am GMT Wed 24th Feb 2010

Liberal Democrats would replace the unfair Council Tax with a Local Income Tax related to people's ability to pay

Oxford City Council has one of the highest council tax levels in England, and it has been the ambition of Liberal Democrat councillors for several years to reduce the level of increase, and bring the Council Tax level more into line with other authorities. Until this year, the Labour group, which holds the largest number of seats on the council, has rejected Lib Dem proposals for reductions. Usually they have had the support of Green group councillors in imposing 4% or higher increases on the citizens of Oxford.

On Monday evening, the Labour group's own budget was initially rejected in council by the combined votes of the opposition parties. Feeling that there were many good ideas in the Lib Dem group's proposals, Labour offered to add the Lib Dems' proposed amendments, while shelving some Labour proposals, and maintaining the council tax increase at 2%.

The main items achieved by the Lib Dems as a result of this agreement included special payments for those in fuel poverty, larger grants for community centres (following recent changes which require them to pay business rates), and maintaining the level of support for PCSOs (Police Community Support Officers) in the city.

Under the Lib Dem minority administration between 2006 and 2008, a number of programmes were put in place to reduce the council's costs and to improve value for money in the council's operations. These have resulted in several million pounds worth of savings in the last three years, including in particular reductions in costs of the leisure centres through bringing in a not-for-profit social partner.

Liberal Democrats in government would replace the council tax with a Local Income Tax, related to people's ability to pay. We believe that the council tax falls more heavily on those with low or fixed incomes. But while the two main parties remain wedded to it, the priority must be to keep it as low as possible.

The amount paid in council tax by ordinary citizens comprises an element set by the county council (which is about 80% of the total), an element set by the local police authority (over which there is virtually no democratic accountability) and in some cases, an element set by local parish councils.

At the county council budget-setting meeting earlier in February, the Lib Dem group proposed a 2.5% increase in council tax, below the level of 2.75% proposed by the Conservative administration (which was eventually adopted). The Labour group on the county council submitted no budget proposals, therefore it is impossible to know what level of council tax they thought was appropriate.