Maximum council tax rise approved by Leicestershire County Council

Members of Leicestershire County Council today (Wenesday) debated and approved the 4.99 per cent rise in its share of the bill.

The increase means the charge for county council-provided services will increase by £1.54 a week for Band D properties for the 2025/26 financial year. County residents also pay tax to their district or borough council, some parish councils, the police and the fire service, meaning the overall bill hike is likely to be more.

The Conservative-run authority has said it has “no option” but to put the additional cost on residents. The increase will bring in around £20 million for the struggling council, but this is expected to be “wiped out” by the rise in employer National Insurance rates announced by the Government in its autumn Budget. Even with the new tax level, the authority has said it will need to use £6 million in reserves – one-off funding often used by councils to bridge the gap between income and costs – to balance its books for the coming year.

Speaking today, cabinet member for resources Lee Breckon said the council was facing a “tough” financial situation, with “rapidly rising demand” for services and inflation driving up costs. He added: “The pressure on our budget is relentless […]. It won’t be easy and further savings will be needed.”

“We are lean, we are high-performing, but we are low-funded,” Coun Breckon added. “We continue to do the very best we can with the money we have. We do not want to increase council tax again this year, but without it we would have to make a further £20 million saving next year on our services.”

Around £38 million of savings still need to be found for the 2026/27 financial year, however, rising to £91 million by the end of 2028/29, in order for the authority to balance its books. Councils have to show a balanced budget each year or must file a Section 114 notice, essentially declaring themselves bankrupt. Despite this, however, council leaders promised in December they would not be making service cuts for the coming financial year.

Instead of reducing services, they said, the authority would be looking to “stem the growth” in its outgoings. Some of the initiatives already in place to help with this include investing in technology to help people continue to live independently at home, and teaming up with Barnardos to set up locally-run children’s homes to save on costs of placing vulnerable young people in private-sector homes.

Since the original budget proposals were put forward, leaders have set aside around £1 million more to clean up after devastating flooding at the start of the year, and to help make the county more “flood-ready”. The authority said the money would be used to undertake more investigations, designed to pinpoint the causes of flooding and identify any potential solutions, and to fund drainage repairs.

The budget also sets aside around £100 million more to support vulnerable children and adults across Leicestershire, which the council said was in response to a “huge increase in demand”, as well as £28 million for pot hole and road repairs.

Opposition members spoke out at the meeting against the budget proposals, however. Leader of the Liberal Democrats on the council, Michael Mullaney, branded the budget one which would “cost the people of Leicestershire more” but “deliver them less”, adding that the council tax rise was “coming at a time when people were struggling to make ends meet”.

He said: “People still look around and see all the things that are not being delivered: the poor state of local roads; the poor state of many pavements that need resurfacing […]; we’ve seen bus services lost in my own area of Hinckley […]; parents of special needs students have had long waits for Education, Health and Care Plans.”

However, the Conservatives’ Nick Rushton, who has temporarily stepped aside as leader of the council for health reasons, accused opposition members of not putting forward any alternate proposals for the budget despite their criticism of his party’s proposals. He added: “It is a good budget. It is, as usual, an exceedingly challenging budget, and [it is] well put together.”

Ultimately, members voted to support the budget with 35 in favour of it and 14 against. That means all the measures in the budget will be implemented.