Council Tax Implications

Since both authorities began sharing one workforce, South Hams District Council has benefited from greater savings than West Devon (£3.9m per annum for South Hams and £2.2m a year for West Devon). This has helped make it possible to freeze the district council element of Council Tax in South Hams in the past.

However, if a new Council is formed, Council Tax would need to be brought up to the same levels across the whole of the new Council area. Currently, West Devon residents are paying more Council Tax than South Hams residents for very similar services. This means that for South Hams residents, their District Council element of Council Tax would need to increase up to the same level as West Devon, this is known as equalisation. Equalisation could take place over a period of up to 10 years (so by the end of the period all residents of the Council area would be paying the same levels of Council Tax).

The amount of money that both councils collect from council tax bills to pay for the services they provide is less than 12% of the overall bill, the rest goes to Devon County Council, Police and Crime Commissioner for Devon and Cornwall, Devon and Somerset Fire and Rescue Authority and the Town and Parish Councils.

The increase to South Hams residents is set out in the following table which shows how much South Hams Council Tax would increase each year. The increase includes the already forecast £5 a year increase. Using the figures below, West Devon residents would also see an increase of £5 per year which is already forecasted, but would not see an additional increase as they are already paying council tax at a higher rate.

As an example, if you are a South Hams Band D Council Tax payer and equalisation took place over 5 years, your Council Tax would need to increase by £17.59 each year for 5 years (or 34p per week for 5 years). On top of any increases from Devon County Council, town and parish councils, the fire services and police.

The increase in Council Tax income also provides a real opportunity to improve and enhance services and invest in the community, for example through affordable housing schemes and community grants. Real benefits can also be achieved through combining our properties and other assets

Hardship Fund

The new Council would continue to operate an Exceptional Hardship Fund. This is a fund to offer short-term help to customers getting Council Tax reduction who are most severely affected by the changes.

The Councils seek your views on the periods over which you feel Council Tax should be equalised.