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Where does my council tax actually go?

Council tax. Pretty much all of us have to pay it, but where does it actually go? Well, actually quite a lot of places, and it doesn’t only go to the council. Have a read through this guide to see how your hard-earned money is spent.

Before we get into the full list though, it’s worth outlining how much council tax we all pay. It is not a flat rate for everyone. The tax is split into eight bands - H is the highest, and A is the cheapest. The cost for each band also varies depending on which parish you live in - but that will be explained in more detail later on in this guide.

The lowest cost in the Royal Borough for 2020/21 is £907.53 per year, while the highest is £2,992.05. A band D property in unparished Maidenhead pays £1,395.60.

Council services:

The vast majority of council tax is used to pay for council services.

Before the financial year begins, the council calculates how much money it will need to run the many services it provides. Things like adult social care (ie care homes), children’s services (ie support for vulnerable families), education (ie schools), highways (ie fixing pot holes) are all paid for out of the council’s revenue budget.

In 2020/21, the revenue budget is set as £86.9million. More than three quarters of this (£67.4million) will be paid for by council tax. Quite simply, without council tax, the Royal Borough, and councils up and down the country, would be crippled.

While the council does receive income from other places, like car parking fees and grants from central government, these alone are nowhere near enough to keep the local authority running.

Every year the council gets to set how much council tax will be that year. However, there are some caveats. A council can only increase council tax by 2.99 per cent each year. If it wants to increase it any more, the authority must hold a referendum.

Adult Social Care precept:

Since 2016/17, councils were allowed to increase the council tax bill beyond the 2.99 per cent limit if this extra money was used for adult social care. With an ageing population, this additional funding goes some way to helping support vulnerable adults as the demand increases.

This money is used by the Royal Borough to improve the accommodation available to adults with learning disabilities, make more nursing beds available for people with dementia and other complex needs, and help meet the rising costs of care in care homes or in people’s own homes.

Each year, the council is allowed to increase the adult social care precept by 2 per cent, on top of a council tax increase of up to 2.99 per cent. In 2020/21 the council will make £981,000 through the precept. A band D household will pay £96.46.

Parish councils:

Many households within the Royal Borough also fall into a parish - a small district within the local authority that has its own parish council.

Parish councils are responsible for providing services for their own residents, and this cost is added to the council tax bills of these residents accordingly. These parish councils use the money to maintain allotments, footpaths, parish halls, and also on expenses relating to planning matters.

The cost to residents varies greatly depending on which parish they live in. Those who live in Shottesbrooke, which doesn’t have a parish council, pay nothing at all, while those in White Waltham have to pay £99.74.

Some areas of Maidenhead, Ascot and Windsor do not fall into a parish, and are considered ‘unparished’. Residents in these areas still pay a fee to contribute to the above services in their areas, the same way a parish charge is made.

Police:

Similar to how the council has its revenue budget for the financial year, so do Thames Valley Police. This is dictated by the Police and Crime Commissioner for the Thames Valley, following a public consultation.

Like with the council, a significant amount of the money police receive is paid for by council tax. For the Thames Valley, households in Berkshire, Buckinghamshire and Oxfordshire all contribute towards its police force.

The amount paid by each household is again determined by which band they are in. Band A pays £144.19, band D pays £216.28 and band H pays £432.56.

Approximately £37million will be spent on operational policing services. £13.5million will be used for pay and price rises for officers and staff. £13.4million will be used to recruit more officers, £5.7million on strategic investment funding that are intended to improve policing - things like a mobile app for officers, more Tasers and the introduction of drones into local policing.

Royal Berkshire Fire and Rescue:

Much like council tax contributes towards the police budget, it does the same for firefighters too. A band A home pays £45.07, band D pays £67.60 and band H £135.20. These figures were determined by the Royal Berkshire Fire Authority following a public consultation in February 2020.

About two thirds of Royal Berkshire Fire and Rescue’s £38million revenue budget comes from council tax contributions. A £28million chunk of the fire service’s budget is spent on employees - hiring new staff and providing pay rises. £5million on supplies and services, £2million is spent on premises, and £426,000 on ill-health retirement costs and injury awards.

Some of the money is also used in the service’s capital programme, which funds long-term improvements to service delivery. This money is used on enhancing fire stations, investing in IT systems and improving the service’s fleet of vehicles.

Financial troubles:

In 2020, the Royal Borough is experiencing difficulties with its finances. Its budget, approved in February, aimed to deliver £6m-worth of savings to grapple with a projected overspend of £3.7m for this financial year.

These financial problems have been further compounded by the COVID-19 outbreak.

The virus is expected to cost the council £14million, and despite receiving several million in grants from the government, it still looks likely that the council will use up all its reserves and go into a deficit position before the end of the financial year.

If this happens, the council will be forced to issue a Section 114 notice, an emergency measure which bans all new council expenditure except for statutory services for protecting vulnerable people.

Cllr Andrew Johnson, leader of the council, is lobbying the government to allow the council to increase council tax above the 2.99 per cent cap without needing a referendum, as a means to restore financial stability to the borough.

If this is permitted, he aims to increase council tax to a similar level to other nearby councils.

This year, a Band D property in unparished Maidenhead will pay £1,395.60 council tax. The equivalent cost in Slough is £1,703.35 and in Reading is £1,976.04.

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