PETERSFIELD town councillors have been forced to rethink their budget after an 11th hour bombshell which will wipe out a massive £40,000 of their income next year.
On Monday councillors decided to raise the town council tax bill by 11.9 per cent to counter the loss taking the their share of the total tax bill to £50.95.
Average tax payers in Petersfield look set to face total bills of £1,104 next year compared with £969.67 this year. The biggest slice of the tax cake is taken by Hampshire county councillors who are known to be struggling with their budget after a devastatingly low government grant allocation. The county council will announce its precept next month.
Town councillors had spent many hours behind closed doors preparing their budget for next year and eventually decided to set a precept of £267,010 which would mean a 4.1 per cent rise for town council tax payers.
But on Christmas Eve, Status Meetings, who rent town council-owned offices at the town hall, announced they would not be renewing their lease at the end of February.
Announcing the news, chairman of the town councilÕs Finance and General Purposes Committee George Watkinson said that budget figures were incorrect and councillors would have to take action to make up for the shortfall in income - a massive one fifth of the councilÕs total income for the year.
He told councillors they had three options. The first was to increase the town precept by £40,000 and make council tax payers foot the whole bill. The second was to do nothing and hope the council found a new tenant for the offices. If they did not the lost income would have to be added to next yearÕs budget.
Mr Watkinson had a third Òhalf way houseÓ suggestion which was to assume the offices would be let at some point and raise at least half the budgeted sum through increased tax or further pruning of the budget.
He said that increasing the precept by £40,000 would mean a 19.7 per cent rise in the town council tax, while adding half the income would mean an 11.9 per cent rise.
But Bob Ayer told councillors: ÒI personally cannot support an increase in the precept.Ó He said he believed councillors would have to go back to the drawing board and ask officers to cut another £20,000 from the councilÕs expenditure next year.
But Ken Hick told the meeting the reason they found themselves in a predicament was that over the years they had Òplundered balances.Ó
ÒThere comes the day of reckoning,Ó he warned the meeting, Òand we are very close to itÓ.
He said that if councillors were to make a 25 per cent increase on last yearÕs budget it would be a £2 increase for each town council tax payer.
ÒI think that most council tax payers would be willing to pay the equivalent of a packet of cigarettes as that is the figure we need.Ó
ÒWe are getting more like a second rate nation all the time. If I go to a supermarket half of what I pay for food goes to paying for the people who clear up the supermarket.
ÒI hold to the view that we should make an increase in the council tax that will stand the test of time and not place the future council in the unenviable position of having to make a large increase just to stay afloat.:Ó
And Mr Watkinson added that he did not believe it was feasible to ask officers to make any more cuts to the budget.
John Crowhurst told councillors they had to budget for the amount of work the council had to undertake next year.
ÒIt should depend entirely on the amount of work to be done, if the council doesnÕt increase the precept to take account of the work, you are preparing a time bomb.Ó
He said that councillors should look at the possibility of letting the offices as a centralised base for voluntary groups at the same time as looking for a new tenant.
And Phil Humphries added: ÒWe have got to look at the work to be done and make sure we do not store up problems for the future - not tax and spend, not being profligate, but looking at the issues properly.Ó
But Brian Dutton told councillors he did not believe they should raise council tax dramatically. He thought they should be looking at raising hire charges at the Festival Hall and other council halls.
Mr Hick proposed that councillors should raise 50 per cent of the Status Meetings rent and Mr Humphries proposed that the money should come from tax tax.
Town councillors voted to raise the precept to £287,010 which means a town council tax rise of 11.9 per cent.
It means Band D tax payers in Petersfield will pay £50.96 next year to the town council compared with £45.53 this year - a rise of £5.43