Council tax bills for Fife residents have been frozen for the coming year in a move to ease financial pressures brought on by the pandemic.
There will be no increase to the eight-tier council tax rate, which starts at the lowest at £853.87 and rises to the highest at £3,137.95, when bills are issued to residents next month.
However, Fife Council has agreed to raise council rents by 1.5% for 2021/22, a smaller increase that the projected 2.2% for tenants, which also takes into account the impact of Covid-19 on households.
The decisions were taken at a meeting of the council to set its rates ahead of the budget meeting on March 11.
In the Scottish Government’s draft budget in January, Finance Secretary Kate Forbes announced £90 million earmarked for councils giving them the equivalent of a 3% rise in support funding if they agreed to freeze council tax rates for the coming year.
By agreeing to do so, Fife will receive around £5.8 million of extra funding.
Co-leader of the Fife administration, Labour Councillor David Ross, said the last 12 months had been “unprecedented and difficult” for everyone and that freezing the council tax was “the right thing to do”.
He added: “Failure to freeze the council tax would result in Fife not getting that extra funding from the Scottish Government and that would me a significant loss to the level of funding for the council.”
Co-leader and SNP councillor, David Alexander, added: “If ever there was a year to freeze the council tax then this was the year to do it given the impact of Covid-19.”
Concerns that the Scottish Government may not “baseline” the money as part of future financial settlements were also raised, with Mr Ross adding that Fife would have the difficult choice of either doubling potential future council tax rises next year or be forced to make cuts to services.
Councillor Tim Brett, leader of the Liberal Democrat council group in Fife, agreed with the freeze, however voiced his disappointment at what he claimed was interference from the Scottish Government.
“It should be the local authority that should be setting and raising its income without being dictated to by the government,” said Mr Brett.
An amendment for the council to write to the Scottish Government to seek assurances over the stability of future funding was agreed.
Rent increase
Council tenants will be expected to pay around £60 per year more in rents after the council confirmed that it will increase rents by 1.5% for the coming year.
While an increase for tenants the increase is lower that what it would have been in ‘normal’ times, it had been set lower to ease the financial pressures faced by tenants due to the impact of Covid-19 on livelihoods.
Normally the increase would have been calculated by adding 1% to the rate of inflation, giving a 2.2% increase, but reduced to reflect the difficulties faced over the last 12 months.
Announcing the plan, Labour Councillor Judy Hamilton – convener of the communities and housing services committee – said there will be £2m made available to support tenants on Universal Credit and working households who have had their employment disrupted by furlough.
She also highlighted that the rent increase would provide £80.6m of investment into council housing.
“That investment will include £31m for property refurbishments, £6.3m regeneration of estates and £2m for energy efficiency measures,” said Mrs Hamilton.
She added that £1.6m from the monies raised would go to improving traveller accommodation in Fife while a further £2.6m would be used to improve homeless hostel facilities across the region.
Furthermore, £30m will be committed to phase three of the council’s affordable housing plans to build 1,500 new homes in the next five years as well as £5m used to purchase properties on the open market to increase the local authority’s housing stock.
However, an amendment by the Liberal Democrat group calling for the council to freeze the rent increase drew a heated response from councillors. His amendment was voted down by councillors.
Mrs Hamilton branded the move nothing more than an attempt at “headline grabbing” adding that the rise had the backing of 62% of tenants groups who were consulted prior to setting the increase.
“Clearly the Liberal Democrats have not done their homework and have come with no suggestion of how we will maintain services and continue to meet the high levels of housing achieved,” she said.
“We offer the highest level of rent support anywhere on Scotland and accepting the Lib Dems plan would put all of that at risk.
“This is a modest increase that will mean services won’t be cut and comes as part of a £250m overall financial commitment to housing.”
Key points
- Council Tax Freeze for 2021/22
- Fife to get £5.8m share of Scottish Government’s £90m support
- Council rent to increase by 1.5% for 2021/22
- £60 increase on tenants’ yearly rent bill
- £2m council rent support commitment for those receiving universal credit or on furlough
- £80.6m investment into housing in Fife
- Including £31m existing housing stock refurbishments