SWINDON Borough Council is planning to impose a 7.2 per cent council tax increase without a referendum by using a legal technicality.

The government has said that where a local authority wishes to increase the council tax by more than 4.99 per cent it must put the decision to a public vote.

Three per cent of that increase must be used to cover social care costs while the other 1.99 per cent can be used for general expenses.

Swindon Borough Council had said that it was planning an increase of exactly 4.99 per cent for the coming year, but it has now emerged that almost half the households in the town will be paying significantly more than that.

The surprise jump comes after the council decided that as of April, it could no longer afford to pay for frontline services such as road cleaning, grass cutting, the maintenance of play areas and even the running of community centres.

Instead, councillors decided to transfer those frontline services to parish councils.

However, only part of the town was covered by existing parish councils when the decision was made – some 41 per cent of households.

The other 59 per cent were in what was called the unparished area.

Residents in that unparished area previously paid a special expenses charge to cover the provision of basic services which, in the rest of Swindon, would be provided by the parish councils.

Last year that charge was £47 for the average household and in total it generated just over £1.7m for the council.

When councillors voted to create new parish councils in the previously unparished area so that the transfer of frontline services could go ahead, residents assumed that the special expenses charge would become redundant and therefore disappear.

But with the council facing unprecedented financial challenges, it could not afford to lose out on £1.7m.

A decision was therefore taken to spread the special expenses rate, or non-parished area charge, across all households in Swindon before adding the 4.99 per cent council tax increase.

The result is that, next year, the average household in an area that was already within a parish boundary – Wroughton, Haydon Wick or Stratton, for example – will pay £1,251 compared to £1,166 last year.

That represents an increase of 7.2 per cent.

In contrast, those households in areas that were previously unparished – such as the town centre, Old Town or Penhill and Pinehurst – paid a rate of £1,213 last year and so their increase only amounts to 3.1 per cent.

In reality all households will end up paying more still when the extra charges for the police, the fire service and parish councils are added on to their bills.

The council has argued that a referendum is not required if the above 4.99% council tax increase comes about as a result of the transfer of special expenses to general expenses.

However, as Swindon is believed to be the first council to attempt a full transfer of frontline services to a new layer of government to save money, it is not clear that the legal argument has ever been tested.

Russell Holland, the cabinet member for finance, said: “It is just a function of the legislation, there’s not a lot else I can say.”

The council had previously given an illustrative figure of £59 as the increase for the average Swindon household, but it now seems that could have been a significant underestimate in many cases.

“I don’t think it’s misleading,” added Coun Holland. “The reason for including that figure in the report was to give a shorthand view of what the average increase is likely to look like.

“This is about the way in which the council tax is calculated.

“The actual council tax increase expressed as a percentage is 4.99 per cent, even though people are paying more because of the way everything gets redistributed after the introduction of parishes.

“I appreciate that if you’re paying more you might not be best pleased about that.”

Asked if he had a message for those residents who were going to be facing a 7.2 per cent council tax increase, Coun Holland said: “Whilst I understand that people don’t want to pay more, I can only assure them that their money is being spent on the most vulnerable people and on doing the very best we can to promote Swindon as a whole.”

The leader of the Labour group has slammed the administration for the way the parishing plans have been rolled out.

Coun Jim Grant, whose group voted against the proposals, said: “It is a scandal for the Tory council to mislead residents into believing their council tax is going up by 4.99 per cent when it is actually going up by 7.2 per cent.

“It shows just how desperate this council is to cover up its complete financial incompetence.

“They imposed large parish precepts on residents to avoid raising council tax by five per cent and thereby triggering a referendum.

“But now they are raising it by 7.2 per cent for nearly half the town and there is still no referendum.

“They’re cutting jobs and services but people are still paying more. It's shambolic.”

The draft budget, which would see these council tax increases imposed, was passed by the cabinet on Wednesday evening and will now move to the next meeting of the full council later this month.