Councils granted permission for significant tax hikes are, Bradford, Newham, Windsor, Maidenhead, Somerset, Trafford, and Birmingham
Six English councils have been given special permission by ministers to raise council tax bills by up to 10% from April—double the limit imposed on most local authorities—as they struggle to avoid financial ruin.
A record number of councils requested approval this year to exceed the standard 4.99% cap, highlighting the growing financial crisis in local government after more than a decade of central funding cuts. Additionally, an unprecedented number of councils have sought emergency financial support from the government in recent months, allowing them to take out special loans to prevent insolvency.
Among the councils granted permission for significant tax hikes, Labour-run Bradford and Newham will be able to increase bills by up to 9.99% and 8.99%, respectively. The Liberal Democrat-controlled Windsor and Maidenhead, which had initially requested a 25% rise, has been allowed an 8.99% increase.
Lib Dem-run Somerset, Labour-controlled Trafford, and Birmingham—currently in special measures after declaring effective bankruptcy in 2023—will be permitted to raise council tax by 7.4%.
Meanwhile, other councils, including Conservative-led Hampshire, Slough, and Cheshire East, had their bids for higher tax increases rejected. Hampshire, however, has vowed to move forward with a local referendum to approve a 15% increase.
The tax hikes come as councils face mounting financial pressures, largely driven by rising costs in social care, homelessness services, and special educational needs provision. In recent years, multiple councils—including Birmingham, Croydon, and Thurrock—have declared effective bankruptcy, unable to meet their financial obligations.
Angela Rayner, the Secretary of State for Housing, Communities, and Local Government, acknowledged the financial distress faced by councils but stressed the government’s commitment to keeping taxes low for working people.
“Tough decisions are needed across local government to fix the broken system we inherited,” Rayner stated in a parliamentary address. “These are difficult choices that the government has not taken lightly. We recognize that limited increases are necessary to prevent councils from falling further into financial distress, but these must be balanced with the interests of taxpayers.”
Rayner emphasized that the government had approved only a small number of requests and had not granted councils their full requested increases. The councils that received approval, she explained, were those with some of the lowest council tax rates in the country. Even after the increases, residents in these areas would still be paying less than the national average for similar councils.
At a national level, Rayner assured that the overall rise in council tax this year would not exceed last year’s increase. She also noted that councils approved for higher tax rates would be expected to provide financial relief programs for vulnerable residents impacted by the hikes.
Despite the government’s assurances, the sharp council tax increases are likely to be unpopular with local residents. In Bradford, for example, a 9.9% increase means that a Band D property owner will see their annual bill rise by £170 to £1,872. However, Bradford Council argued that even after the hike, its council tax levels would remain lower than those of neighboring authorities.
Meanwhile, Hampshire County Council, which had sought a 14.99% increase—equivalent to an extra £230 for a Band D household—has committed to holding a local referendum to push for the rise despite its estimated £2 million cost. Council leader Nick Adams-King said on Monday, “We’ll now consider our next steps in our cabinet meeting tomorrow.”
The financial struggles of local councils have been steadily worsening, with many blaming years of central government funding cuts and rising demand for services. Social care costs, in particular, have placed enormous pressure on local authority budgets.
Upper-tier councils, which provide essential services such as adult social care, children’s services, and housing support, are facing some of the most severe financial challenges. The rising costs of supporting vulnerable residents—combined with inflation and increased wage costs—have left many councils unable to balance their budgets.
Several councils, including Birmingham, Croydon, and Thurrock, have already declared effective bankruptcy, meaning they have been forced to freeze all non-essential spending and seek government intervention. More councils are at risk of following suit if additional financial support is not provided.
Hampshire County Council’s decision to hold a referendum on a 15% tax increase underscores the scale of the problem. If rejected by voters, the council will face even deeper budget cuts, potentially affecting key services such as social care and waste management.
With financial pressures mounting, experts warn that more councils may have to apply for exceptional financial support or seek permission to break the council tax cap in the coming years. The Local Government Association has urged the government to provide long-term funding solutions, warning that short-term measures such as emergency loans and one-off bailouts are not sustainable.
Opposition parties have also criticized the government’s handling of local authority funding. Labour and the Liberal Democrats argue that years of austerity policies have left councils unable to meet the growing demands of their communities.
