The Local Government Information Unit (LGIU) today warned that ministers must heed the warning from the Local Government Association (LGA) that a total gap of £800 million in council budgets could mean another average double-digit percentage council tax increase or cuts in local services.

Dennis Reed, Chief Executive of the LGIU, said: "The £800 million shortfall estimated by the Local Government Association must be taken seriously.

"It would be undesirable if ministers continued putting councils in a position where the delivery of the costly new responsibilities that Whitehall has placed upon local government is not properly funded, then engage in a PR campaign that paints councils as generally profligate and inefficient as a pretext for imposing central government capping.

"In those circumstances, it is disingenuous for the Government to present itself as the knight in shining armour riding over the hill to rescue local council tax payers from their wicked councillors. In fact, they are behaving like the dog in the old joke about the crossbreed between a Rottweiler and a St Bernard - it bites off your leg and then goes to get help.

"Instead, we hope that there is a mature debate about addressing the current budgetary pressures on local authorities - in education, the new duties in children's services and in other areas. Moreover, if central government wants to create a real impetus for councils to be more efficient and accountable, there is all the more reason to press ahead with radical reforms to make local taxation fairer and for local government to raise more than half of its revenue locally."

ENDS

For further information contact:

Kevin Morton	Tel. 020 7554 2858	Mobile 07958 314846	E mail kevin.morton@lgiu.org.uk
Mary Wimbury	Tel. 020 7554 2845	Mobile 07958 521344	E mail mary.wimbury@lgiu.org.uk

Notes to Editors

1. The Local Government Information Unit (LGIU) is Britain's foremost independent local democracy think tank, campaigning to extend local authority best practice, freedoms and responsibilities. Recent initiatives have included the Commission on Local Governance and the LGIU is working to influence the debate on local government modernisation. The LGIU and its sister organisations The Education Network (TEN) and the Democratic Health Network (DHN) provide research, policy briefings, information, advice, training and lobbying services to local authority and trade union affiliates. Previous LGIU news releases and statements can be viewed at www.lgiu.gov.uk.

Government must heed council tax warning