Keeping Council Tax Low and Protecting Services in Lancashire

Keeping Lancashire’s Services Running While Managing Costs

We know that many households are under real financial pressure, and any news about council tax or council finances can be worrying. At Reform Lancashire, we want to be open with residents about the decisions being taken, why they are necessary, and how we are working to protect services while keeping costs as low as possible.

Council tax for the coming year

Council tax will rise by 3.8%. We understand this is not welcome, but we have worked hard to keep the increase as low as we reasonably can.

• 1.8% is needed to maintain the essential services that residents rely on every day. This increase could have been avoided if past investment decisions had been different, which would have given the council more flexibility today.
• 2% is the social care precept, which is ringfenced to fund care and support for our most vulnerable residents, including older people and those with disabilities.

Even with this increase, Lancashire’s council tax rise is the lowest in the county for 12 years and among the lowest in the UK.

The council’s financial position

Lancashire inherited a serious financial challenge from the previous Conservative administration:

• Bonds were purchased at a cost of £509 million and are now worth around £177 million, a loss of £332 million. These disastrous bonds are costing Lancashire residents more than £15 million a year, equivalent to 2.5% council tax cuts.
• Selling these bonds now would force that loss onto the council’s day-to-day budget, which could leave the council unable to legally balance its books.

Protecting Lancashire from crisis

Across the country, 26 upper-tier councils are already reliant on emergency government financial support, and this is expected to rise to 35 councils, around one in four. Because of the work we have done to stabilise Lancashire’s finances, we are not in that position, helping protect local services and local decision-making.

Looking ahead

• The council has £1.2 billion of debt, with a clear plan to reduce this by £125 million over the next five years.
• £65 million of savings will be delivered in 2025/26 — around £5 in every £100 spent, as promised at the election.
• A further £22 million has been identified through efficiency reviews over the next three years, focusing on reducing waste and inefficiency, rather than cutting frontline services.

These are difficult decisions, but they are being taken to stabilise the council’s finances, protect essential services, and put Lancashire on a more secure footing for the future.