Shropshire Council to take nearly £1 million from town & parish councils forcing their precepts up to keep council tax down

Shropshire Council’s cabinet is set, on Wednesday 10 December, to cancel distribution of the government grant that ministers say it should be giving to local councils across Shropshire.This means that from next April, nearly half a million pounds destined for town and parish councils will be hoarded by Shropshire Council to keep its council tax down. This will force many local councils to put their precepts up, while Shropshire Council keeps its council tax flat.

This move, if approved, will mean that Ludlow Town Council will lose £65,000 in grant aid over the next two financial years. Across the county, town and parish councils will lose £947,000 over the next two years. Shrewsbury will lose £146,000 and Bridgnorth £73,000.

Shropshire Council only published its plans on Monday afternoon, just a day and a half before the cabinet meets to agree the scheme (or perhaps reject it). There has been no consultation with town and parish councils and no public announcement. The plan is buried in a technical paper slipped out later than the other cabinet papers.

The money that Shropshire Council has been allocating to local councils is not its own. It’s from central government and compensates parishes for the loss of tax receipts from residents entitled to council tax support. Government ministers have made it clear this “Council Tax Support Grant“ should be passed on to town and parish councils.

Back in March, local government Conservative minister Brandon Lewis told council leaders, including Shropshire Council Leader Keith Barrow:

“I made it clear that the Government’s intention was that part of the funding provided to local authorities in respect of the localised council tax support should be passed down to parish and town councils… If an authority does insist on not passing down funding I would expect the authority to justify to their council taxpayer as to the reasons why.”

A few councils weren’t passing down the money, that’s why Mr Lewis wrote his letter. Shropshire Council had planned to share some of the money with town and parish councils until 2016/17, though it aimed to keep more of it for itself as each year passed. This financial year it distributed £581,000, down from £680,000 last year, but still a very useful sum. From next April, Shropshire Council will keep all the money if the officers’ recommendation is accepted by Cabinet.

Council officers are recommending that cabinet members:

Agree to remove any allocation of council tax support grant to Town and Parish Councils for 2015/16 and future year’s council tax reduction scheme… The Council’s developing financial position no longer makes the payment of grant to Town and Parish Councils affordable and it is recommended that this payment is removed. (Financial Strategy 2015/16 – 2017/18, page 2; 5.12).

In an example of how the left hand of Shropshire Council does not know what it’s right is doing, the accompanying Draft Refresh Business Plan says:

Our customers are at the centre of everything we do… [We] will continue with the mixed economy approach to commissioning, working with partners, other local authorities (including town and parish councils), and with the community.

Just how is stripping £947,000 of funding from towns and parish councils over the next two years treating town and parish councils as “partners” or “customers”?

The purpose of this move is clear. The Financial Strategy shows that council tax in Shropshire will not be raised before the 2017 unitary elections. Shropshire Council is hoarding money it should be giving to town and parish councils to keep its own council tax down. In doing so, it is leaving local councils in a position where they may be forced to put their precepts up if they want to maintain basic local services like toilets and play areas, let alone pay for youth services.

Shropshire Council is taking money away from town and parish councils by stealth. Its not even its money. It is a grant given by government to be passed on to town and parish councils.

Keith Barrow should now follow Brendan’s Lewis’s bidding. He should publicly justify the reason why nearly one million pounds has been stripped away from town and parish councils over the next two years.

Of course, Keith could ask Shropshire Council’s cabinet to reject this measure. In my view, that would be the decent thing to do. Anything else would be a breach of trust between Shropshire Council and the hard working towns and parishes of our county.

What you can do

If the Cabinet decides to approve this recommendation on 10 December, parish and town councillors or the public don’t have to take the decision lying down. People can submit a question to Shropshire Council’s next full meeting. This is on 18 December and questions must be submitted by 5pm next Monday, 15 December. The procedure is to put in a question in writing, usually through the online form. The council will answer in writing. And here’s the most interesting bit, you also get to ask a supplementary question in the council chamber on 18 December. You don’t have to submit this question in advance.

Here’s how to submit a question.

Notes

The details of the withdrawal of the Council Tax Support Grant from town and parish councils are buried in a technical paper issued much later than the rest of the Cabinet papers (Item 8). On 9 December, we received information on current funding allocations from officers. Details of how the grant was intended to have been allocated were agreed at a cabinet meeting on 13 November 2013 (paragraph 4.8). I have used this to forecast the payments to town and parish councils for 2015/16 and 2016/17.

Full list of grants made and estimates of those cancelled for all Shropshire parishes under the Council Tax Support Grant: Allocation of council tax support grant to parish and town councils.

Here are the top dozen losers:

Allocation of government Council Tax Support Grant to town and parish councils Received 2013/14 2014/15 Cancelled 2015-16 & 2016/17
1. Shrewsbury Town £193,057 £ 145,705
2. Market Drayton £99,070 £76,104
3. Oswestry Town £97,319 £74,475
4. Bridgnorth Town £96,767 £73,161
5. Whitchurch Town £93,061 £70,360
6. Ludlow Town £83,687 £65,002
7. Shifnal Town £78,986 £61,519
8. Wem Town £59,666 £46,607
9. Broseley Town £45,939 £35,454
10. Ellesmere Town £41,560 £31,631
11. Church Stretton Town £31,928 £25,275
12. Much Wenlock Town Council £26,103 £22,855

2 thoughts on “Shropshire Council to take nearly £1 million from town & parish councils forcing their precepts up to keep council tax down

  1. As the council might say, this individual’s developing financial position no longer makes the payment of council tax to Shropshire Council affordable. But even if I withhold the money, the law is streamlined to extract a pittance from the pauper. How unjust that £947,000 can be so easily ‘diverted’.

  2. Andy, I suspect that Shropshire Council is running into difficulties with its new private company and that money will be being used for bale out. I have assurance that this is not the case with the Hardship Fund money but I will want to see the financial statement in details at the end of the financial year. I am already asking a question at the meeting – on the health service. JoyceB

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