A 'kick in the teeth' for city's council taxpayers; Inflation-busting rise is on the cards.

Byline: BY ROB MERRICK Political Correspondent

COUNCIL taxpayers in Liverpool are facing an inflation-busting hike in their bills, after a funding round condemned as a "kick in the teeth" by its council leader.

Warren Bradley said the "disgraceful" settlement, unveiled yesterday, would cost the city council around pounds 30m over three years compared to other local authorities.

Mr Bradley said the Liberal Democrat-run council would do its best to "continue our unrivalled record in keeping council tax rises down".

But he warned: "When you take into account inflation and wage rises, we are effectively receiving a cut in funding.

"At a time when the government knows Liverpool is going to be in the international spotlight because of Capital of Culture, they have sold the city short with a disgraceful grant settlement."

There was also bad news for the Merseyside Fire Service which received the lowest grant settlement of any force in the country at just 1% this year and 0.5% in the following two years.

Cllr Jack Colbert, deputy leader of the Lib Dems on Merseyside Fire Authority, last night said: "This is a disgrace. We're being penalised by the government for becoming an excellent authority.

If these sort of cuts are to continue it will cost lives in the future."

Merseyside Police Authority called their rise of 2.7%this year as "disappointing" compared both to last year's 3.5% increase and to that enjoyed by others this year of 3.2%. The Local Government Association (LGA) warned central government funding was simply failing keep pace with rising council costs.

Town halls were struggling to cope with extra migrants, the growing number of pensioners, the rising costs of landfill and the expense of free bus travel for the over-60s. The inevitable result, said the LGA, would be aboveinflation increases in council tax bills next year.

The Tories said the average Band D bill would rise by pounds 208.

John Healey, the local government minister, vowed to cap any authority ignoring his instructions that council tax increases must be "substantially below 5%".

But that would allow for rises up to double the current inflation rate of 2.1% - after many years of increases above 4%.

Even Mr Healey, unveiling the first ever three-year settlement for local councils, confessed the funding round was "tight".

However, the minister insisted the funding announcement, through to 2011, would mean councils had enjoyed a 45% realterms increase since Labour came to power.

Insisting the government "will not hesitate to use our capping powers", Mr Healey said: "This is a tight settlement."

The city council's increase next year is just 2%, as is Knowsley's.

In sharp contrast, are the increases in Sefton (3.6%), Wirral (5.1%) and St Helens (5.5%).

Wirral Borough Council refused to comment on the funding round.

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