MERTHYR Tydfil Council is proposing to increase council tax by 3.55% next year.
Budget proposals set to go before cabinet and then go to the full council for approval on Wednesday, March 3 would see a Band D council tax of £1,728.98 for 2021/22 which is an increase of £59.27 for the year or £1.14 per week.
The cabinet report said that as 84% of the properties within the county borough are valued at Bands A to C, a significant proportion of council taxpayers will be liable to payments less than £1,728.98.
It adds that the Council Tax Reduction Scheme for 2021/22 adopted by
Council in January provides support with council tax payments for those
residents eligible to apply.
The council reduced its opening budget gap for next of £3.58m to a £288,000 budget surplus through:
£2.78m from the Welsh Government settlement; £216,000 through the social services grant; £1.27m in Covid demands being funded by Welsh Government; £764,000 in money for further commitments; £150,000 through the corporate vacancy factor which reflects the salary savings resulting from the natural delay between a post becoming vacant and being filled; £350,000 in employee severance costs and £1.04m in service cuts.
With £106,000 from measures withdrawn at full council, £1.9m in additional demands and £705,000 going towards a council service capacity exercise, this resulted in the £288,000 surplus.
But with the council tax increase proposal of 3.55%, this results in a net loss of income of £343,000 compared to what it would have been with a 4.99% increase as originally modelled.
This means the council has a £55,000 budget deficit which it plans to address through a reduction in the pay award provision.
This leaves the council with a revenue budget for the next financial year of £133.34m.
The council is expecting the Welsh Government’s Covid-19 Hardship Fund to continue into 2021/22 with estimated additional costs of £1.27m requiring extra financial support.
These costs include £871,000 around homelessness provision, £31,000 related to school transport, £275,000 in lost car parking income and £100,000 in lost conference income.
The council received a 4.64% increase in its funding from the provisional Welsh Government settlement back in December.
Cabinet meets at 4 pm on Wednesday, March 3 before the full council meets to vote on the budget at 5 pm.