Extra council tax will fail to plug social care funding gap, LGA warns

Extra council tax income in 2018/19 will fail to protect under pressure social care services, the Local Government Association (LGA) has warned.

The LGA said an extra £548m raised through the social care precept would be wiped out by the Government’s National Living Wage.

LGA Chairman Lord Porter said: “Extra social care funding will be wiped out by the significant cost pressures of paying for the Government’s National Living Wage and extra general council tax income will only replace a third of the central government funding they will lose this year.

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“This means councils will have to continue to cutback services or stop some altogether to plug funding gaps.”

The LGA said 64 councils (42%) were considering or had approved raising council tax by 5.99% (2.99% for general increase plus 3% for the social care precept).

The body warned, however, that 75 social care councils (49%) would be unable to levy any social care precept in 2019/20 when services caring for the elderly and disabled face an annual funding gap of £2.3bn.

A funding gap of more than £5bn is facing local councils by 2020, the LGA added.

Lord Porter said: “The need for adequate funding for local government is urgent. To maximise the potential of local government and protect local services from further cuts, funding gaps must be properly addressed and local government as a whole must be allowed to keep all of the business rates it collects locally each year to put it on a sustainable footing.”

 

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