Levelling up secretary Michael Gove has confirmed that the government is considering reform of council tax and that junior minister Lee Rowley has been tasked with reviewing the options.
Giving evidence to the Levelling Up, Housing and Communities Committee, Gove described council tax reform as a “challenge”, and “one that we want to look at”.
He added: “I know that both the chancellor and Lee Rowley want to look at this as well. And both of them are much more ‘on it’ than me. Lee … has been looking at this at the chancellor’s and my own requests.”
Gove, who earlier in the session had described council tax as the “second most unpopular tax in the country” said he would be able to give the committee more information in the New Year.
Council tax is regressive in nature and is currently based on property values from more than 30 years ago. Reform has been needed for many years, but governments have been reluctant to face the inevitable political opposition to any change coupled with the cost of a revaluation.
There is much more that we can do in order to reform local government finance to make it simpler and clearer, to have fewer streams, a greater degree of local discretion and fewer pots for which people bid.
Council tax and care costs
At the evidence session, the secretary of state was asked about plans in the Autumn Statement to delay the Dilnot reforms to social care and to partly cover care costs by allowing local authorities greater “flexibilities” in raising council tax. Labour MP Mohammad Yasin questioned Gove on whether, given the cost-of-living crisis, the plan was fair.
“I think yes,” replied Gove. “Giving local authorities a greater degree of flexibility is part of a package along with delaying reforms, providing the cash that is then released and adding grant funding to that. So it’s a mix, it’s a balance.”
Committee chair Clive Betts pressed Gove on the need to reform social care funding as part of a wider reform of local government funding. “Keeping going back to council tax or other short-term fixes isn’t really a solution from a local government point of view,” he suggested.
“I think that is fair,” said Gove. “There is much more that we can do in order to reform local government finance to make it simpler and clearer, to have fewer streams, a greater degree of local discretion and fewer pots for which people bid.
“That is one thing, and that will improve the situation. But I do agree that until you’ve got a sustainable approach toward social care, then you don’t resolve the problems overall.”
—————
FREE weekly newsletters
Subscribe to Room151 Newsletters
Room151 LinkedIn Community
Join here
Monthly Online Treasury Briefing
Sign up here with a .gov.uk email address
Room151 Webinars
Visit the Room151 channel
