Merton Councillors Vote Out £25 Tax Rebate

Labour proposals defeated by other parties

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Plans for Merton council taxpayers to get a £25 refund for the next four years have been voted out at a council meeting.

The proposals had been put forward by Labour as part of their local election manifesto. But the group has a minority rule on the council, and the other parties opposed the plans.

This year's £25 refund was to have come from Merton Borough Council's general fund, reducing the reserves from £10.2m to £8.5m.

But Merton Park Independent Councillor, Peter Southgate (left), told the meeting: "The Merton Park Independents have consistently opposed proposals to strip the reserves in order to pay a one off rebate since Labour first announced them three years ago, and we remain firmly opposed.

"I have no wish to see this authority slipping back towards the perilous financial position it was in at the end of the 90s. We are still working through the implications of the £6.2bn cuts already announced by central government and what they mean for Merton, for example the loss of Area Based Grants.

"But the elephant in the room, the known unknown, is the Comprehensive Spending Review, to be published in just five weeks' time. Whether we're facing cuts of 15%, 25% or 40% in funding over the next four years, we know it’s not going to be good news.

"In the face of all these unavoidably downbeat expectations, to come forward now with proposals committing the council to find an additional £6.8m over the next four years to pay for the rebate demonstrates a complete detachment from reality, bordering on recklessness."

Lib Dem Council leader Iain Dysart said afterwards: "We were shocked by just how bad these plans were. Labour wanted to tie up £1.7m in the council’s budget each year, just to post it back to residents after taking it from them. Not to mention the extra administration and staff costs – more than £100,000 over the next 4 years. At best, this proposal gives with one hand and takes more away with the other."

Councillor Diane Neil Mills, the Conservatives’ Finance spokesman said: "This was a cheap gimmick from Labour which could have proven costly for the financial health of the Borough. How on earth can Labour propose short term spending of this kind whilst dithering over the decision to build the new school that Wimbledon desperately needs and the new pool that residents want to see built in Morden?"

Labour’s cabinet member for finance, Councillor Mark Allison, said: "This has been Labour’s policy for two years or more. We’re now the largest party in Merton and as a result, we're intent on keeping our promises.

"It's the people's money, times have been hard and they need it more than we do. Council tax is a regressive tax that hurts the poorest so giving some of it back will help."

September 21, 2010