Tax relief for struggling residents extended by East Suffolk Council, but budget gap still predicted to grow

A Council Tax relief scheme for struggling residents has been extended by leaders but the authority’s budget gap is still predicted to grow.

On Tuesday last week, members of East Suffolk’s cabinet approved the extention of the authority’s Local Council Tax Reduction Scheme (LCTRS) for another year.

The scheme was put in place by several of the county’s authorities to help struggling residents and encourage people back into work.

In East Suffolk, thousands of residents have been able to get up to 91.5 per cent of their council tax taken off their bill since the 2022/23 financial year — next year, the number of those eligible could be around 7,765 working-age residents.

Cllr Vince Langdon-Morris, the council’s lead for finance, said: “This recommendation ensures the principle of everyone making at least a small contribution towards their council tax is continued while providing support to vulnerable and low income households.

“This also maintains a level of council tax income to provide funding for services at district and county level.”

Council papers stated an option to provide relief for 100 per cent of a claimant’s council tax, or around £117 extra support, was considered but not recommended due to the oressure it would place on its finances.

The overall state of the council’s books was also discussed on Tuesday, as councillors were presented with the latest available predictions for the upcoming financial years based on its performance during the current year’s second quarter.

Although the forecasts still showed a financial gap of just over £3.4 million, this was still a better financial position than anticipated in February, when it was predicted to be around £5.2 million.

For the upcoming years the hole is still predicted to widen, albeit at a slower rate with the latest predictions forecasting a £7 million gap by the 2027/28 financial year — instead of £8.37 million anticipated in February — and £7.5 million the following year.

As of the end of March, the council’s earmarked reserves, one-off pots used for specific purposes, was at £42.18 million and was expected to fall to between £25 million and £30 million by 2028/29.

On the amount of fees and charges for next year, set to be decided in January, council papers stated the authority would aim to ‘use all resources available’, including hiking fees by more than the current baseline of three per cent.