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'Double whammy' tax hike to pay for social care

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Earlier this week the Government announced an increase to National Insurance.

The new 1.25 percent National Insurance levy is part of the Government's plan to generate money for social care and the NHS.

However, according to the Express, much of this money will initially go to the NHS, to help clear up a coronavirus related backlog. As such, funds won't be prioritised towards social care until as late as 2024.

This leaves local councils with a funding crisis - which many fear could spark a wave of council tax rises next year. In fact, the Daily Telegraph reports that a leading minister admitted a sharp rise in council tax bills is "a worry".

Many other ministers also believe the average council tax bill will increase by five or six percent next year.

Speaking to the paper, they added: "At the end of it all, people are going to ask themselves 'do they want the Government to level with them and be honest' or 'do they want a government that wrings its hands and does nothing."

Labour MP Clive Betts, who chairs the Housing, Communities and Local Government Select Committee, warned more tax rises are likely to fund social care.

He said: "Councils tax bills will have to rise because there is no other way for councils will be able to pay for social care.

"There is no social care plan and no social care money.

"The people who are going to be hit hardest by the council tax increases are the very people hit hardest by National Insurance increases. It is a double whammy in April."

On Wednesday the House of Commons voted to back the Government's National Insurance rise, by 319 voted to 248.

Despite reports of significant Conservative disquiet, only four Tory MPs joined Labour in voting against the measures.

Labour leader Sir Keir Starmer argued the plan unfairly targets working people.

He commented: "Under his plan, a landlord renting out dozens of properties won't pay a penny more, while their tenants in work will face tax rises of hundreds of pounds a year."

Speaking to the Daily Telegraph several local government leaders admitted council tax is likely to rise next year.

Councillor Andy Morgan, an executive member on Bolton Council, commented: "Yes, we would absolutely be looking to increase the precept next year.

"It is always like we're still kicking the can down the road a bit.

"If we can give £5.5billion to the NHS now then there should be some money we should be able to stretch to adult social care within the local authorities, which is in crisis at the moment because of the restricted budgets we are working under.

"We're just concerned that it's not really how long it's going to take to get to us and how much is actually going to get to us because we [social care] have always been the poor relative to the NHS."

Councillor Shane Moore, who heads Hartlepool council, put the blame squarely on Westminster.

He said: "The Government kicking the can down the road for many years has basically put an adult social care precept on local councils to try to fund the deficit.

"Last year, we didn't implement it, because we didn't implement a council tax increase either, just simply because we were trying desperately to give our residents a break, given the difficult year they just had.

"It is disappointing that of the announcements from increasing National Insurance that seemingly local authorities won't be getting any additional support for at least three years.

"Once again, local authority leading social care is playing the bridesmaid to the NHS."

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