Lambeth’s cabinet has approved a 4.99 per cent council tax rise for residents.  

The rise, equating to just under £80 extra per year for residents in Band D properties, is the biggest increase that can be made without the council holding a referendum.  

Lambeth’s finance lead said the Government has left councils no other choice.  

The move, along with the rest of the council’s budget for the coming year and its medium term financial strategy for 2021/22 to 2024/25, was approved at a cabinet meeting on Monday (February 8).  

Cabinet already approved proposals for more than £15 million in extra cuts over the next four years in December.

This was added to the previously agreed cuts of £28 million from 2020 to 2024.

Cllr Andy Wilson, cabinet member for finance and performance, said despite the Covid-19 pandemic and uncertainty around the future of local government funding, the council has been able to balance the budget.  

He said: “The council’s prudent financial management means we’ve been able to weather this storm for now and set a balanced medium term financial strategy through a mixture of income generation, savings, and use of reserves.  

“But the future will not be plain sailing, and fundamentally the Chancellor’s spending review did little to change the fact that councils will be forced to make cuts in 2021 onwards to balance their books. 

“Almost half of the chancellor’s £2.2 billion increase in the core settlement for local government assumes that councils will raise taxes locally – they have written that into their assumption – to the maximum allowable limit.” 

The Government has told local authorities they can raise council by 1.99 per cent, as well as a three per cent rise for the adult social care precept.  

The new proposed bands in Lambeth are: 

Band A  £818.62 

Band B £955.06   

Band C £1,091.49 

Band D £1,227.93 

Band E £1,500.80 

Band F £1,773.68 

Band G £2,046.55 

Band H £2,455.86 

Cllr Wilson said: “As central Government fails to keep up with long-term rises in demand for essential services and social care, we’re increasingly being forced to finance services from tax revenues, exacerbating the squeeze on local budgets and tax payers that started in 2010.” 

An extra £1.5 million is set to be added to the council tax support scheme for 2022/23, which is expected to reduce bills for 7,000 eligible households “with most of those seeing their bill reduced to nil”. 

The leader of the opposition, Green Cllr Jonathan Bartley, raised concerns that the added council tax support would not come into effect until 2022/23 and that the council plans to raise funds through enforcement.  

Cllr Ed Davie and Cllr Wilson said there is precedent for having to go through a long consultation before the extra support is introduced.  

“Because, believe it or not, there are some people who do not want us to increase our council tax support for local residents and would rather see people paying more,” Cllr Wilson said.  

He added: “However, awaiting the outcome of that we are putting forward funding to essentially create the same amount of relief for residents as they would receive under the new council tax support scheme that we’re consulting on for the following year.” 

He said no one receiving support for council tax would likely be affected because of the help they will get.  

On enforcement action in general Cllr Wilson said it will start again, but “not in any meaningful way” yet for those who don’t receive support because of backlogs in courts.   

He said: “We will begin enforcement in the way we always have done in the past, which is a very soft method of text messages and letters – no one gets knocked on the door.” 

The council has also put aside an extra £500,000 to support residents at risk of financial hardship, an extra £1 million for discretionary housing payments, more funding for local advice surgeries, and is considering further support for people who need to self-isolate.