It’s the season for deciding the council tax we will pay from April. Last year, Ludlow Town Council raised the precept, it’s share of your council tax, by 24%. This year the rise will be 21%. That means that the precept will have gone up by half in just two years. As with last year, this looks to be largely an anticipatory rise to cover the cost of taking on services from Shropshire Council and extra staff. But so far, the town council has yet to take on these extra services or appoint a deputy town clerk. That, along with delays to vital repairs to the Guildhall, seems to be the main reason why the council has failed to spend 25% of its budget this year.
Currently, Band D residents in Ludlow pay £133.30 a year to Ludlow Town Council. Next year that will rise by £27.77 – a 53p a week (21%) increase. The rise comes after 70% of residents that responded to a council survey backed increasing the precept if necessary to fund services being cut by Shropshire Council.
The town council budget for 2018/19 year will be £863,000. It’s finances look healthy. The council added nearly £11,000 to its reserves this financial year, increasing them to £181,000.
I am though concerned about the inability of Ludlow Town Council to spend the money it raises. It is planning to carry forward £200,000 of unspent money from this financial year to the next. That’s one quarter of its budget. The previous year it underspent by £80,000. I cannot see any extenuating factors that justify an increasing underspend. Councillors need to get on with spending the money they raise.
If the new precept is adopted, and I am sure it will be, Ludlow will not be the most expensive town in Shropshire. For this financial year, six market towns set a higher precept than Ludlow, with Bishop’s Castle and Church Stretton topping the league with precepts of above £170. It costs much more to run services in small towns, largely because of the difficulties of achieving economies of scale. In Shrewsbury, for example, the precept in 2018/19 will be just £45.68 a year. That’s an increase of around 10% on the previous year and barely more than a quarter of Ludlow’s precept.
Ludford parish council has not published its precept for next year but it is likely to be under £20 despite Ludford residents relying on Ludlow for its services – the so-called “Ludford Question”.
From 1 April, many low income people and families in Shropshire will have to pay 20% of their council tax bill for the first time as Shropshire Council “shares the burden” of financing public services with the county’s poorest.
Shropshire Council will make a final decision on the overall council tax bill on 22 February.
. In recent days, Ludlow Town Council has advertised for a deputy clerk, a new position agreed 12 months ago. The council has agreed in principle to take on eleven play areas from Shropshire Council, subject to further negotiations. Figures the town council published last year suggest this will cost £17,000 annually.
. The town council should ideally have reserves of between £136,000 and £545,000. I cannot see that reserves need to be at the higher end of the range, as it does not engage in high risk activities. It had planned to draw down £41,000 from its reserves in 2017/18.
. Section 30(6) of the Local Government Finance Act 1992 states that councils must set their budget before 11 March for the following financial year.