The increase will generate an extra £50 million of vital revenue income towards the delivery of crucial services to the people of Hampshire in 2025/26, and still means that Hampshire has one of the lowest council tax precepts of any county in England.
County Council Leader, Cllr Nick Adams-King said: “Having frozen our council tax for many years in line with the policy of the previous Government, this is a necessary increase to help tackle the continued pressure on our budget which is now at a record high. We had hoped that Government would allow us to increase council tax up to a maximum of 15% from this April, which would have helped us to take action towards balancing the books beyond this coming financial year, but this was not the case.
“Each 1% of Council Tax increase in Hampshire nets more than £8 million additional revenue for the Authority. Offset that against the ever-rising cost of social care. Every month in Hampshire we see a net increase of 30 people living in care homes who become reliant upon the County Council to pay their costs - even at the most basic level of care these 360 people add a further £18.7 million of cost to our budget each year.
“Every month we are seeing an extra 200 applications for Education Health and Care Plans - the first step for children to register for Special Educational Needs (SEN) support. That exponential rise is the reason our budget for Home to School Transport (for which SEN children qualify for free) has increased from £24 million per year at the end of the pandemic to £105 million next year. Add to this to the effect of employers’ National Insurance, which will cost us £10.5 million this year - we will get a one-off reimbursement of £8 million from Government with nothing for future years. I haven't mentioned things like inflation which of course adds further to the bill.
“Therefore, we are left with no other choice than to increase council tax by the maximum allowed without a referendum and use up even more of our reserves to help plug this year’s budget gap. Repeatedly having to use our reserves to balance the budget is not a sustainable position. They can only be spent once, then they’re gone. We have cut over £700 million from our budgets in the last ten years, and will continue to look for further savings, but there is little left to find, and by 2026/27 our reserves will be exhausted. This is the context within which we find ourselves. We will be asking for residents’ views on further savings proposals in the coming months.
“The council tax increase agreed today has been an incredibly difficult decision to make, particularly as we fully understand the ongoing pressure on household budgets. However, this increase – an extra £1.47 per week for a Band D property, is essential to help us ensure that we can continue to deliver core services to those people who rely on the support of the County Council each and every day – the children at risk of harm, abuse and neglect, our growing older population, and children and adults with disabilities and additional needs. By keeping the increase below the referendum threshold, we are balancing the need for vital additional funding with our commitment to minimising the financial burden on our residents."
Alongside revenue spending plans for the next financial year, the County Council also approved the capital budget for the next three years, with building and infrastructure projects totalling £1.167 billion - providing a major boost to the local economy through jobs, skills and construction, as well as ensuring necessary assets are in place to provide services to the people of Hampshire now and in the future. Under local government finance rules, the Council’s capital resources cannot be used to shore up the running costs of the revenue budget.
The capital programme includes:
• £188m investment in new and extended school buildings to provide more school places for children in Hampshire
• £166m for structural maintenance and improvement of roads and bridges
• £245m for Integrated Transport Plan schemes
• £107m to address condition-based enhancements to schools
• £50m for waste recycling infrastructure to meet legislative requirements