Council agrees 4.99% tax rise amid fiscal pressure

Sheffield Council has increased council tax by the maximum amount allowed as it struggles to balance its budget.

Councillors approved a 4.99% increase for the next year, which is the largest rise without the need for a local referendum, at a town hall meeting earlier.

The council will receive £301m of income via council tax, which is £17m more than 2024-25. Increases in business rates and grants are expected to generate another £4.4m.

Labour councillor Zahira Naz, the council's finance spokesperson, said the funding settlement from the government had been "better than expected and provided much needed breathing space" for the authority.

She said: "Let's not pretend it undoes the years of financial strain that councils have faced. We are still dealing with the long-term impact of austerity, the rising costs of delivering services and the increasing demand on social care, housing and public services.

"But it does allow us to make decisions with a little more certainty which will help us protect the services people rely on."

Over the next year the council will have pressures of almost £72m because of a rise in demand for services and increases in inflation.

Around £54m of these pressures relate to adult and children social care services.

The council still faces a £2m black hole due to the government's decision to increase national insurance.

The council is a coalition with no single party in overall control and Green Party Leader Douglas Johnson said all the parties had worked on the budget.

He said: "The council is stable, it is not going to go bankrupt but things are hard and we are in a very difficult financial position.

"We are 23% down on spending compared to 2010 and that is a huge cut in services."

Liberal Democrat Leader Shaffaq Mohammed said: "Has Labour watched the BBC news and seen what is coming in a couple of weeks when the chancellor makes further cuts?

"The next few years are going to be really challenging with national insurance increases, pressures on social care and international issues which will impact on this city."

Officers said the council was planning to make savings but "robust action" was needed to contain financial pressures in the coming next year.

The council tax rates households will pay for 2025/26:

Band A: £1,352.66

Band B: £1,578.10

Band C: £1,803.55

Band D: £2,028.99

Band E: £2,479.88

Band F: £2,930.76

Band G: £3,381.65

Band H: £4,057.98

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