on Sun 12 Oct 2008 03:29 PM BST | Permanent Link
Council Tax Payers to bail out Local Authorities who invested in Iceland
No, No No!
Local Authorities are reported as having a total of £1bn tied up in the failed banks of Iceland. Some reports are suggesting that if this money is never returned, then the council tax payer will have to pay again to cover this loss.
Since its introduction, council tax has always risen annually by more than both the rate of inflation and average earnings. It is forecast to triple to £25bn by 2010.
Local Authorities have therefore received ever increasing real term amounts of tax payers' money and clearly have too much - hence the £1bn investment they have been able to make. No longer will council tax payers' believe that they are "cash strapped".
This is a national problem and any bail out to Local Authorities is the responsibility of the Government. They laid down the rules and guidelines that allowed Local Authorities to make these investments. They must share the responsibility for the consequences of these investments. The Government found £50bn to bail out the banks - another £1bn for Local Authorities shouldn't be a problem.
Government and Local Authorities are both accountable to the electorate. Council tax payer's have been exploited for over 10 years now. Gordon Brown says that he will do whatever is needed to help hard working families. He can start by making a binding promise that council tax payers will not be expected to pay again for any loss that may result from this crisis.