Council tax 'to cost £200 more by 2020'

Council tax bills in England could cost an average of £200 more for band D properties by 2020, the Local Government Association has warned.

The claim comes after extra fundraising powers for councils were outlined in last week's government Spending Review.

But the LGA said councils would still face a combined shortfall of £6.8bn by the end of the Parliament.

The government said council tax was expected to be lower in real terms in 2020 than a decade earlier.

In the Spending Review, Chancellor George Osborne said local authorities responsible for adult social care would be allowed to increase council tax by 2% above existing limits.

By adding in the maximum new levies allowable without a referendum, the LGA estimated that Band D bills could cost an average of just under £200 more over the next five years.

It said this would not be enough, particularly as budgets continued to face new pressures such as those caused by an aging population.

Any shortfall might have to be made up by further increases to costs such as car parking charges, it added.

One senior councillor said councils were now also facing "a reckless gamble" of having to use cash reserves to fund services.

A Department for Communities and Local Government spokesman said: "In reality councils will have almost £200bn to spend on local services over the lifetime of this Parliament, a cash terms increase and a reduction of just 1.7% in real terms each year.

"The Spending Review offers a £3.5bn package for adult social care to ensure councils can support their older and most vulnerable residents, while at the same time council tax is expected to be less in 2019-20 in real terms than it was in 2010-11.

"With councils accounting for a quarter of all public spending it's right they continue to play their part in paying off the deficit."