CABINET proposals recommending a significant increase in Council Tax rates by 16.31% for the fiscal year 2024/25 AND the following three years have been met with stern opposition by Independent Group of councillors, The Herald has learned.

The proposed year-or-year hikes, aimed at addressing the financial challenges faced by the cash-strapped County Council has sparked a wave of concern amongst many families who are already facing the cost-of-living crisis.

Councillor Andrew Edwards said: “The proposed increase in council tax stands as an unjust burden on the citizens of Pembrokeshire, particularly during a period marked by an escalating cost of living crisis and the onset of a confirmed recession.

“Despite a fall in inflation, the decision by the current administration to implement a significant tax hike seems not only disproportionate but also detrimental to the financial stability of our community.

“Such an increase is far from being just or sustainable, placing an undue strain on households already navigating the challenges of tightened budgets and economic uncertainty. Our communities deserve a lot better.”

Councillor Huw Murphy, representing the Independent Group, is completely against the proposed large hikes, highlighting the disproportionate burden it would place on Pembrokeshire’s residents compared to other Welsh counties.

According to the proposal detailed in the “Notice of the Meeting of Cabinet” published last week (Feb 13), a Band D property’s Council Tax would increase by £4.20 per week or £219.02 per annum, amounting to a 16.31% hike annually until 2027. This stark increase is a departure from last year’s indication of a manageable 7.5% rise over the Medium Term Financial Plan (MTFP).

The implications of adopting such a recommendation are profound, with a Band D property owner in Pembrokeshire facing an increase of £930.68 by 2027/28 compared to a scenario where Council Tax rises by just 7.5% annually. Cllr. Murphy has criticised the Cabinet’s rationale, citing a lack of evidence to justify such an “extraordinary amount” and points out the potential for Pembrokeshire to become the highest Council Tax authority in Wales, surpassing even Blaenau Gwent, currently holding that title.

The financial strain is attributed mainly to the Social Services Department’s increasing costs for ‘Out of County’ placements. However, Cllr Murphy told The Herald that most other departments are operating within budget, many even presenting a surplus. The stark contrast in proposed tax increases across Wales further fuels the debate, with Cardiff, Carmarthenshire, and Swansea proposing much lower increases, casting Pembrokeshire’s approach as exceptionally burdensome and potentially unfair to its residents.

Cllr Murphy says there is a broader concern regarding the impact of such increases on local households, potentially driving working families and pensioners into poverty.

The proposed tax rise starkly contrasts with the current inflation rate and projected pay increases, raising questions about the council’s consideration for the economic realities faced by its residents and the potential adverse effects on the county’s ability to attract and retain essential workers, including teachers.

The Independent Group has proposed amendments to the budget in hopes of mitigating the impact on residents but finds the reduction offered insufficient to address community concerns.

In a letter to Cllr Alec Cormack, the Cabinet Member for Corporate Finance for Pembrokeshire County Council, Cllr Huw Murphy said that there is no justification to support an annual Council Tax rise of 16.31% up to and including 2027.

He explained the matter had already resulted in fear and desperation entering many households and will drive many working families and pensioners on fixed incomes into poverty.

He wrote: “I am informed there appears to be no likely easing of pressure on PCC in respect of funding ‘Out of County’ placements by Social Services, with the presumption this will continue rising exponentially until 2027/28? Homelessness was a topic of conversation twelve months ago. However, homelessness numbers have decreased by 24% between March and December 2023. Therefore, there will come a point when (no one knows when), ‘Out of County’ placements will plateau if not decrease.

He continued: “I would be grateful for a written response providing an explanation with supporting evidence as to the need for applying a 16.31% Council Tax increase for not only 2024/25 but also for the following 3 years (MTFP), moving away from the presumption of a 7.5% Council Tax for the MTFP as recommended on Feb 13, 2023.

“The Independent Group met the Director of Resources and proposed amendments to your budget on Feb 13, and aspects of our proposals were deemed appropriate to offer a lower Council Tax rate than 16.31%. We are grateful for the assistance provided to us at this time.

“However, the reduction offered was insufficient to allay community concerns and we withdrew our proposals, leaving your Cabinet recommendation as the only current option.”

Cllr Murphy continued: “The need to consider imposing a higher than 7.5% Council Tax for 2024/25 will be debated and voted upon on March 7. However, I currently see no justification to ALSO recommend a 16.31% Council Tax rise for the following 3 years.  If we go down this path I foresee significant community tension and disengagement between residents and PCC and a brief glance at social media over the last week will confirm this. 

“There is huge concern by a majority of Councillors across the whole chamber with regards to the proposed 16.31% rise in Council Tax for 2024/25 and I am gravely concerned at your desire to now factor in an annual 16.31% Council Tax rise into the MTFP (until 2027).”There is huge concern by a majority of Councillors across the whole chamber with regards to the proposed 16.31% rise in Council Tax for 2024/25 and I am gravely concerned at your desire to now factor in an annual 16.31% Council Tax rise into the MTFP (until 2027).

“I do not want to see this authority reject a budget and the consequences this will bring upon Officers and ourselves.

“However, in life we sometimes have to make decisions that appear controversial, possibly unthinkable but if done in the best interests of our residents then that is what has to be done, and your recommended Council Tax rise of 16.31% is taking us to this point. Through many recent conversations it’s clear your Council Tax  proposals needs to be reduced by a significant percentage to have the support of Council on March 7th, 2024.

“Therefore, should Council fail to agree a budget on March 7th, 2024 through the the loyalty of the majority of Councillors to the people of Pembrokeshire in defending them from an unaffordable Council Tax rise; then you as Cabinet lead for Finance, along with the Leader and other Cabinet members must bear full responsibility and with it the consequences as all Cabinet members voted for a 16.31% Council Tax rise in 2024/25 and the recommendation of an annual 16.31% Council Tax rise into the MTFP. 

“Independent Group Councillors we are willing to work with Councillors across the Chamber to achieve the goal of protecting residents of all ages, be they rural or urban from the impact of your current proposals which will have far reaching and negative consequences if passed on March 7th”, Cllr Murphy added.

The Herald understands that the recommended 16.3% increase is for the tax year 2024-25 and not for future years.

This is at odds with the IPG’s letter.

Any Council Tax increases for future years were not, as The Herald understands, discussed at Cabinet.

Currently, the finance team and Pembrokeshire County Council is predicting increases of 7.5% from 2025-26 onwards continuing up to 2027-28.

However, this could be subject to change – of course.