Aberdeen officials are campaigning for a 10% increase in council tax – as the city toils to balance the books.
Leaked briefings prepared ahead of next month’s budget meeting show finance chiefs think it could raise an extra £12.9 million annually.
The Scottish Government has not capped council tax increases this year.
The proposed hike would take the annual bill for a Band D property in Aberdeen from £1,418.62 to £1,560.
The final bill for residents would end up even higher. Other charges, including those for water supply and sewage, would still be added to the total cost.
Options being put to councillors range from maintaining the current tariff – which would bring in around £129.2m next year – and increasing the levy by as much as 12%.
That uppermost suggestion would raise an extra £15.5m for the local authority next year, the city’s accountants forecast.
But another part of the document – seen exclusively by The Press and Journal – details officials’ endorsed way forward, which indicates 10% is the option being pursued.
Is council tax going up elsewhere?
Neighbouring Aberdeenshire councillors set their council tax last week. The debate there was whether the annual charge should leap four or six per cent.
The eventual four per cent increase, it was admitted, would not be “universally welcomed”.
In Aberdeen, a 10% council tax rise could be accompanied by an across-the-board hike, as it would be “in line with proposed increases to other council fees and charges”.
Council tax for the financial year 2023-24 will be set at a meeting on March 1. The full briefing will be published for public scrutiny around a week before.
But this exclusive excerpt paints a picture of the financial lay of the land at the Town House – and the types of decisions councillors could be thinking of making.
City finance chief: One-off savings leaving council in ‘unsustainable position’
In August, they were told the city would need to slash £53m when setting next year’s budget.
The daunting savings target is so high for 2023-24 because councillors voted to save £19m through one-off wins last year.
These short-term measures can not be replicated in the years to come, meaning officials have to find new ways of balancing the city chequebook.
At the start of the month, chief finance officer Jonathan Belford said: “One-off funding streams present the council with an unsustainable position.
“Each year that you balance a budget based on a one-off funding stream, for example, reserves or taking advantage of fiscal flexibility as we have this year, that has to be replaced the next year.
“As a result, it becomes evermore unaffordable to actually find new solutions and therefore strikingly difficult for the overall budget to be sustainable over the medium to long term.”
That forecast now looks the reality, with the 10% council tax rise understood to be one of the ways the bookkeepers suggest saving – or cutting – more than £50m.
By 2027-28, the council will have to trim £134m, by officials’ own moderate estimates.
All options laid out by the accountants would leave the local authority with a £9.5m surplus, leaving leeway for a lesser council tax increase potentially.
A 4% increase, as passed in Aberdeenshire, would still leave it with a £1.7m cushion.
Potential Aberdeen council tax rise not a done deal yet
But it will be the elected members who take the eventual decision on how to keep the council in the black next year.
A council tax increase would add to the mounting costs people living in Aberdeen will have to contend with.
Residents living within controlled parking zones face eye-watering hikes of up to £140 a year if they wish to park their car outside their homes.
This would be on top of the mounting cost of living nationwide, as household bills skyrocket.
A city spokeswoman told The P&J: “Finalised budget options drawn up by officers will be published on the council’s website later this month.
“Councillors will meet on March 1 to agree a budget for 2023-24.
“It would not be appropriate to comment in advance of this.”
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