Meeting of the Parliament 28 March 2018
I have to make progress as I have only five minutes, I have taken one intervention and I have a lot to say on the Government’s position.
It is a fair judgment to say that political parties will attach different weights to the considerations that were set out in the commission on local tax reform. It highlighted the need for relief to be available for low-income households. The council tax reduction scheme provides exactly that, and our reforms enhanced it, especially for households with children. We have increased the child allowance by 25 per cent, and we continue to refuse to follow the United Kingdom Government’s damaging example of applying a two-child cap.
When local taxation was last debated, I was clear that we were on a journey of reform and that those were just the first steps. I was also clear that I was willing to engage. Members are well aware that we have made reforms through the Barclay review of the non-domestic rates system, and we are interested in engaging further on the council tax, but we have been determined to strike the right balance between protecting household incomes and ensuring that our public services have the resources that they need in order to deliver. I believe that our decisions on tax and the allocation of resources achieve that balance.
In our 2016 manifesto, we set out that the time was right, after nine years, to lift the council tax freeze, but that increases would be capped at 3 per cent and not at 5.99 per cent, as applies in England. That strikes the right balance. All councils have now set their council tax rates for the forthcoming financial year, and all have increased the council tax by 3 per cent, which will mean a further £77 million for local services. Without some sort of constraint, taxpayers would risk facing increases such as the 12.5 per cent increase that the Labour minority administration in North Ayrshire proposed for 2018-19. Where we have asked households to pay more tax, we have done so in a reasonable and balanced way. We continue to be committed to making local taxation fairer and ensuring that tax overall is progressive, and we continue to be open to discussing how that might be achieved.
The Opposition parties may be able to provide a critique of the Government’s position or the existing council tax regime, but there is no majority view on a replacement. In keeping with our collaborative approach on taxation and proposals for further reform, there needs to be serious engagement, and not cheap political points.