Croydon gets special permission to raise council tax by 15%

Bankrupt Croydon Council has been given special permission by the government to raise council tax by a “staggering” record amount.

Residents in the south London borough will see bills rise by 15% from April – 10% more than most other local authorities.

Around £235 will be added to the average annual household payment, which is on top of Sadiq Khan’s almost £40 increase for the Council’s part of the bill.

It means Band D homes will pay more than £2,230 a year for their total bill.

Under current rules, councils can only increase council tax by 4.99% this year without a referendum, including a 2% levy to pay for adults’ social care.

Croydon’s Tory mayor Jason Perry said the government had given his borough special permission to raise extra funds “to put the council back on a sustainable footing” after it issued its third bankruptcy notice in just two years in November.

Thurrock and Slough councils have also had applications approved to increase council tax by 10% as part of the final local government funding deal. Mr Perry blamed the previous Labor administration for the increase.

The authority was left with debts of £1.6bn when Labor lost power last May.

“I know this will be difficult for the people of Croydon,” Mr Perry said. “But without the proposed increase, the council would have to make another £20m of cuts this year, putting vital services for vulnerable residents at risk.”

He added that additional funds would be made available for a tax support scheme for the poorest residents.

Croydon filed for its third bankruptcy notice in just two years in November after admitting it would not be able to balance its books without a state bailout.

Croydon North Labor MP Steve Reed said: “The Tories in Croydon plan to hit residents with a staggering 15% council tax rise amid a Tory cost of living crisis – instead of getting fair funding from to their own government.

“What planet do they live on? Residents simply cannot afford it.”

A Government spokesman said: “Given the exceptional circumstances in these councils and the unprecedented scale of the financial shortfalls in each council, the Government has agreed to the requests.

“Under their requests, Thurrock and Slough will be able to raise their council tax by a further 5% above the referendum principles applied to other councils, and Croydon will be able to raise a further 10%.”