AS more able bodied people prepare to rally in London for this SundayÕs Liberty and Livelihood March, an elderly retired couple are accusing the government of unfairly discriminating against rural communities.

John and Christine Melsom, who live in the local area, are calling for the formation of a Council Tax PayersÕ Association following news that East Hampshire district residents could be faced with a 25 per cent hike in council tax from next April.

ÒWith our present very low inflation, such an increase is beyond reason. Council tax payers, particularly pensioners, cannot continue to support increases far in excess of the year on year inflation rate,Ó points out Mr Melsom.

The former public servant points out that for five years now council tax has increased annually by roughly three times the rate of inflation. This has been sparked in part by a reduction in central government funding and by additional burdens being placed on local authorities without compensation from central funds.

ÒIn this way council tax has become a Ôstealth taxÕ, with local councillors being blamed for higher tax or service cuts, rather than Gordon Brown,Ó points out Mr Melsom.

According to a document sent to Mr Melsom from a Parliamentary source, not only have local authority burdens risen faster than central government funding, but councils have been loaded with countless new regulations, obligations and red-tape for which there has been no compensation.

According to the House of Commons library, the level of central funding has fallen from 76 per cent in 1997 to 73 per cent today.

ÒIn other words, the government is funding less of local authoritiesÕ demands from the centre, and the shortfall has to be made up in higher council tax, otherwise public services suffer,Ó says the document.

Furthermore, there are plans afoot to change the system of distributing grants to local government. In essence, the government proposes to redistribute money from Shire counties in the South of England to deprived city areas in the North and the inner London boroughs.

There are a number of options under consideration, broken down by core services such as education, police and social services. The proposed formula is based on a basic per capita allocation, with extra money included for factors such as deprivation and high ethnic minority populations.

Which ever option is selected, it is predicted that the South East could face a shortfall of around £200m in ten years time, resulting in cuts in services or higher council taxes.

Already local authorities are having to cope with new red tape in the form of Best Value administration which, according to the Local Government Association, is costing an extra £175m a year on top of the central allocation of £40m.

New taxes include Advanced Corporation Tax (ACT), which has increased the cost of providing pensions by an estimated £300m a year. Britain also has the highest fuel taxes in Europe which has increased transport costs to councils, and higher taxes for landfill which are increasing the cost of rubbish disposal.

Other unfunded obligations have resulted in a total overspend last year of £183m on Social Services, coupled with the need to pay for damage caused by recent flooding; a cut in the emergency planning budget; a shortfall in asylum costs; the extension of concessionary fares to men aged 60 and over; the impact of the Homelessness Bill; and the cost of introducing new executive structures.

In addition, the disposal of fridges and freezers could cost local authorities a total of over £50m, while similar costs are expected to derive from EU directives on abandoned cars, on landfill and on meeting the governmentÕs new recycling targets.

According to the Melsoms, 25 per cent of the basic state pension already goes on council tax. ÒBeing a pensioner, I canÕt earn any more money and any increase in pension is likely to be in line with inflation - one per cent of very little is still very little,Ó said Mr Melsom who believes that inflation linked pensions and wage increases are serving to increase the gap between those on high and low incomes, a fact which will be further exacerbated if council tax bills start to rise out of all proportion to inflation.

ÒI just donÕt think we can take it,Ó say the Melsoms who believe that there is a need for the revival of a group similar to the old Rate PayersÕ Association.

ÒWe need a lot of people speaking with the same voice,Ó says Christine Melsom who would be keen to hear from anyone interested in setting up a Council Tax PayersÕ Association.