Ludlow Town Council to decide on raising its precept by 24% to take on Shropshire Council services

Update 30 January 2017

Ludlow Town Council tonight agreed to raise its precept by 24%. From 1 April, its share of council tax for a Band D property will rise from £107.60 to £133.30.

Main article 26 January 2017

I updated this article on 28 January to clarify some points and add the council paperwork.

There are a number of interesting matters on Ludlow Town Council’s agenda next Monday night. A little way down the agenda, a couple of items after public toilets, is a paper on increasing the parish precept for 2017/18 by nearly a quarter (24%). That’s likely to be one of the biggest percentage rises across Shropshire.

The council has yet to make a clear case on why such a big rise is needed when it is so reluctant to take on services from Shirehall.

Currently, Ludlow Town Council sets a precept of £107.60 for a Band D property.[1] This will rise to £133.30 if the proposals are approved on Monday night. To put this in perspective, the increased precept amounts to less than the cost of pint of beer a month – but all increases in taxes need to be justified in detail.

The rise is being partly driven by Shropshire Council’s plans to transfer services to Ludlow Town Council or stop funding them. Shirehall is asking the town council to take on nearly £170,000 of services by April 2018.

Ludlow Town Council has not yet accepted it will accept responsibility for all the items on this transfer list.

The council has made an expression of interest in taking over the play areas in the town at an annual cost of £17,000. It is right that the council adopts these. Play areas are local services that serve people that live within the town. They should be managed and funded locally.

To extend this argument, before looking at the rest of the transfer list, our library, museum resource centre and leisure centre should not become the responsibility of Ludlow Town Council. Neither should Shropshire Council customer service points. These facilities serve a very wide area and the costs should not be borne by Ludlow alone. The services must remain with Shropshire Council.

The transfer list includes a subsidy of £74,000 for Ludlow Assembly Rooms. There is no agreement on any transfer of ownership or subsidy for LAR. Negotiations have been delayed by the need to find funds for extensive repairs to the building. I think there is a clear case for subsidy for the Assembly Rooms but I would be surprised if Ludlow Town Council agreed to continue it at £74,000 a year.

The Visitor Information Service is vital for our town. If Shropshire Council won’t run it, and it won’t, we’ll need to run it ourselves. The Buttercross is in the same position and the town council has already agreed to take our great little museum on.

Ludlow town councillors have not so far shown a commitment to running youth services or the Youth Centre.[2] I think the council should take responsibility for both as they primarily serve Ludlow town. I am sure the costs of running the Youth Centre can be reduced but the grant for youth activities needs to be more than £10,000 a year. We need double that figure to be effective.

As you can see, we have a mixed picture on services transfer from Shirehall to Ludlow. Some councillors would prefer nothing to be transferred but that is not a tenable position. Other services such as libraries, museums and leisure services must continue to be provided at a wider than local level by Shropshire Council. But when we are talking about local to Ludlow services, we should accept that we need to run them locally.

If we agree that principle, we need to raise more funds and the staffing structure of Ludlow Town Council will need to be strengthened. There is only passing mention of staffing needs in the council paperwork. Appendix 1 refers to a deputy clerk at a cost of £30,000 a year.

Given that services won’t be transferred to April 2018 at the earliest, why is Ludlow Town Council going for such a big hike in its precept? After all, Bridgnorth is planning to raise its precept by only 4% and Shrewsbury town council by 3.99%. Oswestry is going for 2.17%.

There a number of short-term costs, including repairs to the Henley Road cemetery and the Guildhall roof. But there is an underspend on the budget of £86,000 this year – that’s 37% on my calcuation. This is carried over to next year, when £41,000 will be taken out of reserves.

A threat by the secretary of state for communities and local government hovers over all parish and town councils. Sajid Javid wants larger rises in local council precepts to be subject to a referendum. He has backed off for now but is threatening to impose expensive referendums for any increase of more than 1.99%, the same limit that applies to council tax rises.[3] This would mean that Ludlow could only raise an extra £9,000 year on year. That’s barely enough to cover wage rises and inflation, let alone an expanding role in delivering local services.

I am generally in sympathy with Ludlow council’s wish for a steep rise in its precept to set it on a firm footing for the future. But I don’t think a clear enough case has been made. I would like to see a costed five-year strategy for delivery of local services in Ludlow, including services that might be transferred from Shropshire Council.

The precept rise will be debated at Ludlow Town Council, 7.00pm next Monday, 30 January. Members of the public have an opportunity to speak at the beginning of the meeting. Contact the town clerk for details: townclerk@ludlow.gov.uk

The overall picture

No decision has been made on what level Shropshire Council will set council tax for the next financial year. The maximum it can raise bills without a referendum is 4.99% – 1.99% for general purposes and 3% for adult social care. Council leader Malcolm Pate has already all but ruled out a referendum. That limits Band D council taxes to £1271.63, a maximum rise of £60.43.[4]

The Police and Crime Commissioner and the Shropshire and Wrekin Fire Authority may also increase their precepts. Again, these hikes cannot be above 1.99% without a costly referendum.

I am far from sure that Ludlow Town Council will approve a 24% rise on Monday. But if the council does so, and Shropshire Council, the police and fire services raise their taxes to the maximum, what does this mean for local taxes in 2017/18? On my calculations, we are looking at a total local taxation for Ludlow householders of £1,694 for a Band D property. That’s £92 pounds extra for the average household, an above inflation rise of 5.4%.

Council paperwork

Budget and precept 2017/18

Action Plan

Service Plan

Budget by cost centre  – 2016/17 & 2017/18

Notes

[1]. All tax figures in this article refer to Band D properties.

[2]. Ludlow Town Council has expressed an interest in transferring the Youth Centre to its responsibility but has not gone further.

[3]. House of Commons Library: Council tax: local referendums.

[4]. Shropshire Council’s cabinet will decide on its recommendation on the level of council tax on 8 February. Council will then be asked to approve the rise on 23 February.