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‘£3.2m reserves is £1m too much’ for Hyndburn Council
A COUNCIL has come under fire for ‘banking’ £1million instead of spending it on services or cutting council tax.
However the leader of Hyndburn Council said it would need ‘robust reserves’ if it were to pull off an ambitious bid for local business rates to be slashed.
Leader Miles Parkinson was criticised by the opposition for ‘overcharging homes’ in the decision to keep reserves at £3.2million instead of the government’s recommended £2million in fallback cash.
However Coun Parkinson said the authority was hoping to persuade the government to slash ‘crippling levels’ of tax on Hyndburn businesses. If successful, the bid would affect 40 per cent of the council’s funding which comes directly from business rates.
Coun Parkinson said: “We are very keen for the government to revalue business rates. The last time this was done the economy was on the up and rates were charged accordingly. Since then things have gone quite downhill.
“What we are hearing from businesses is that they are finding the amount asked of them to be completely crippling.
“But in order for them to pay less we have to be prepared. If the government listen to us and do as we ask, it affects 40 per cent of our grant from government.
“That will see us receive much less in future years. We are willing to do that, but we would need to plan ahead and have robust reserves to stay afloat.”
Opposition leader Peter Britcliffe said not using the cash this year was a ‘lost opportunity’. He said: “That money could see a very significant cut on council tax for homes who desperately need it. To me, it’s not a reserve but the result of overcharging homes in Hyndburn when there was no need to do so.
“The council could have also used it to regenerate the economy. Hoarding it away for a rainy day is futile.
“It is raining today, and not just raining it is pouring.”
A spokesman for the Department for Communities and Local Government, which is responsible for the collection of business rates, said: “We have no plans to revalue business rates as it is done every five years and is not due for some time.
“However any proposal sent to us by a council will be looked at and considered thoroughly.”