Average council tax bill set to SOAR by £107 in the biggest hike for 14 years after town halls are allowed to raise charges by 6% and increases police funding

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Average council tax bills are set to soar by £107 after the Government told town halls they could increase charges by an inflation-busting 6 per cent.

The police will also be allowed to charge an extra £12 per household next year in an effort to ease pressure on force budgets. 

Communities Secretary Sajid Javid unveiled the eye-watering increases today - just days before Christmas - as he announced the new local government funding settlement.

The changes mean a typical £1,591 Band D council tax bill will cost up to £1,698 next year - £95 in extra council tax, plus the £12 extra police precept. 

If councils pass on the increase in full, it will the biggest single year rise in 14 years. 

The Taxpayers Alliance slammed the tax rise saying it is wrong to hike bills for hard-pressed Britons and called for more efficiency savings instead.

Tory MP Bob Blackman told Mail Online: 'It is not a happy Christmas message to see for hard-pressed council tax payers.'

Communities Secretary Sajid Javid unveiled the eye-watering increases today as he announced the new local government funding settlement

The changes mean a typical £1,591 Band D council tax bill will cost up to £1,698 next year - £95 in extra council tax, plus the £12 extra police precept

He added: ‘My view is that the problem with the council tax rises is it's very difficult for local authorities to plead poverty if they don’t increase their council tax.

‘But the effect is it will be six per cent increase – that is double the rate of inflation. It hits people who are on low incomes and find it hard to pay their council tax. 

'This will make it really hard for the people who are struggling to make ends-meet right now.’

He said councils should be free to set their own council tax levels but warned they ‘face the wrath of the electorate’ if they hike them too high.

Mr Blackman said councils are facing big pressures to fund adult social care but expressed concerns that the burden is falling on council tax payers. 

Tory MP Andrew Bridgen said: ‘Both national and local government need to remember they are the servants of the people, not their masters.

‘They should remember that all money is taxpayers’ money, and that they will be held accountable for tax rises and value for money at the ballot box.’ 

The increase is higher than expected as Mr Javid gave council leaders permission to break a cap on rises without calling a local referendum. 

He told MPs the aim was to hand councils 'the levers and the incentives' to grow their own economies.

He said: 'While we all want to ease growing pressure on local government services, I'm sure none of us want to see hard-working taxpayers saddled with ever-higher bills.

'This settlement strikes a balance between those two aims, giving councils the ability to increase their core council tax requirement by an additional 1 per cent without a local referendum - bringing the core principle in line with inflation.

'This change, combined with the additional flexibility on the adult social care precept that I confirmed last year, gives local authorities the independence they need to help relieve pressure on local services.'

Mr Javid did acknowledge there had been 'concern' over funding for adult and children's social care but said that councils had access to £9.25 billion of funding for the sector.

He said: 'We've put billions of pounds of extra funding into the sector and that's why the Department for Education are spending more than £200 million on innovation and improvement in children's social care.

'At the spring Budget, an additional £2 billion was announced for adult social care over the next two years, with the freedom to raise more money, more quickly through the use of the social care precept.

He added: 'This settlement recognised the need to keep spending under control while also tackling many of the issues that have been raised by local government over the past year.

'With two years of real-terms increases in resources available to local government, it will give local authorities the funding and the freedom they need to make decisions in the best interest of the communities that they serve.'

Shadow communities secretary Andrew Gwynne told Mr Javid that the settlement 'failed on all counts' to address 'many of the problems' faced by local government

Council tax bills have been rising steadily since 2015 when Government money to support a freeze came to an end and councils were given new powers to charge extra for social care.

Most bills were frozen in 2012 when the government introduced a rule that meant any proposal to increase council tax by 2 per cent or more in England must be put to a local referendum.

John O'Connell, chief executive of the TaxPayers' Alliance, said: 'With wage growth stagnating and the cost of living on the rise, it beggars belief that politicians are asking for powers to take even more of people's hard-earned money. 

'Council tax has already nearly doubled in the last decade so it isn't fair to ask residents to plug the gaps in their finances, especially when we know that council tax already hits the poorest hardest. 

'Councils should instead continue to root out waste and scrap any item of spending that does not help provide an essential service.' 

And he warned that the government must not simply resort to higher taxed to plug police budgets. 

He said: 'In a dangerous world, it's important that police and security forces have the resources they need but to think that the only way to fund them is through ever-higher taxes is wrong. 

'If the government wishes to increase police budgets it should do so by reducing spending from elsewhere in the bloated Whitehall bureaucracy. 

'In the meantime, police forces should ditch gimmicks like painting their fingernails for social media posts and instead prioritise protecting people from real harm.' 

For the first three years, councils were given a further incentive to avoid council tax rises all together via 'freeze grants' worth the equivalent of a 1 per cent funding increase.  

Mr Javid also revealed the rollout of a pilot 100 per cent business rate retention scheme in 10 local authority areas - Berkshire, Derbyshire, Devon, Gloucestershire, Kent and Medway, Leeds, Lincolnshire, Solent, Suffolk and Surrey. 

The police will also be allowed to charge an extra £12 per household next year in an effort to ease pressure on force budgets 

Shadow communities secretary Andrew Gwynne told Mr Javid that the settlement 'failed on all counts' to address 'many of the problems' faced by local government.

He added: 'Councils are desperate for additional funding and I'm sure that they may well appreciate some of the piecemeal solutions offered by the Secretary of State today, but we are still without a sustainable plan, a vision for how the sector will be funded in future.'

Liberal Democrat Home Affairs Spokesperson Ed Davey said: 'The impact of this cut in police budgets will unfortunately be rather different from the government's smoke and mirrors spin.

'With crime rising even faster than inflation, the Home Secretary should have increased police budgets in real terms.

'By refusing to listen to senior police officers' calls for investment, Conservative Ministers are failing to keep our streets safe.

'Even the Conservatives' attempt at a stealth council tax rise wouldn't be enough to protect local police forces.'

Lord Porter, Chairman of the Local Government Association, said: 'Greater flexibility for local authorities in setting council tax levels will give some councils the option of raising extra money to offset some of the financial pressures they face next year. 

'With no other national tax subject to referenda, the council tax referendum limit needs to be abolished so councils and their communities can decide how under-pressure local services are paid for, with residents able to democratically hold their council to account through the ballot box.'