Shock 10 per cent Perth and Kinross council tax rise could be in the pipeline

A surprising 10 per cent council tax hike is being considered for Perth and Kinross residents to fund essential health, social care, and education services, according to SNP council leader Grant Laing. This proposal sheds light on the significant funding challenges faced by the local authority as it grapples with escalating demands and expenses. However, PKC Labour councillor Alasdair Bailey argues that double-digit tax increases may not be necessary if the Scottish Government utilises the UK Government funding recently announced in the Westminster budget.

The Holyrood government is scheduled to present its spending plans for 2025/26 next week. In February of the current year, PKC councillors approved a freeze on Council Tax for 2024/25, alongside planned 4.9 per cent increases for 2025/26 and 2026/27. Following this, councillors are now being asked to consider a 10 per cent assumed rise for 2025/26, with indicative increases of 10 per cent for 2026/27 and six per cent for 2027/28. This multi-year approach aims to address the escalating demands on public services, particularly in adult care and additional support needs for primary school pupils.

Council leader Laing stressed the importance of this direction as it prepares for the upcoming budget. The focus is on recognising and tackling the challenges confronting the council, including the increasing costs of essential services for vulnerable individuals. Councillor Bailey expressed hope that the substantial Barnett consequentials from the UK Government will be passed down to councils by the Scottish Government, potentially alleviating the need for high council tax rises.

Moreover, PKC Liberal Democrat leader councillor Peter Barrett lamented the financial strain on the council due to underfunding and cuts, emphasising the need for a realistic council tax strategy to safeguard crucial services. The council’s chief executive, Thomas Glen, endorsed the proposed council tax strategy as a means to sustain vital services for residents and facilitate long-term planning.

The plan includes increasing the percentage of income from council tax allocated to the capital budget, aiming to ensure the sustainability of capital investment strategies. Laing highlighted the positive outcomes of this approach, indicating interest from other councils grappling with balancing capital project costs and community investment needs. By diverting an additional 0.25 per cent from future council tax revenue, PKC aims to bolster confidence in its investment in infrastructure and buildings.

In conclusion, the proposed council tax rise in Perth and Kinross reflects a proactive effort to address financial challenges and safeguard essential services. As local authorities navigate funding complexities, strategic planning and collaboration with higher government bodies become imperative to ensure sustainable service provision and community well-being.

Insights:
The proposed 10 per cent council tax rise in Perth and Kinross underscores the ongoing financial pressures faced by local authorities in Scotland. With increasing demands for vital services and rising costs, councils are compelled to explore bold solutions to maintain service quality. The multi-year approach to budget planning provides stability and predictability, essential for effective resource allocation. Collaboration between local and national governments is crucial to ensure adequate funding for essential services and alleviate the burden on local taxpayers. By prioritising sustainability and community investment, councils can navigate financial challenges and continue to support their residents effectively.