ALBA Youth Co-Convener Christina Hendry on ALBA's Council Tax Freeze
ALBA Party campaigned for a Council Tax Freeze and we are pleased that one has been announced. ALBA were the only political party in Scotland that supported a Council Tax Freeze. Ironically it seems that the only party in Scotland that are outright opposed to a Council Tax Freeze are the SNP’s Green coalition partners.
Of course, as always, the usual players are in a spin. Labour spent the past month saying that council tax shouldn’t go up, which was interesting because every single Labour Council across Scotland was budgeting to increase their own areas Council Tax by at least 5%. The Labour Party these days are far from the party my grandparents knew looking to keep money in the pocket of the working man.
What may really come as a surprise (or maybe not) is Labour’s hypocrisy in that earlier this year in English Local elections their flagship promise to voters was that Labour would freeze Council Tax for every home in England next year. So they wanted to freeze council tax in England but raise it in Scotland? And funded by what? Raiding more tax out of Scotland’s North Sea Oil and Gas revenues. “Better Together” indeed. And further evidence Labour is not the home for independence supporters who no longer feel welcome in the SNP.
I’ve heard many say that a Council Tax freeze only helps the “more better off households” but this is far from the reality. In actual fact many would rely on this money, young people especially who are already paying sky high rents or have mortgages that have risen to unaffordable rates. It’s difficult to say one generation had it better than another given all there is to compare, but in terms of property it does feel like previous generations were more fortunate.
Recent interest rates increases can be seen in measures of mortgage affordability. And of course younger people are more likely to still have a mortgage. The share of borrower income taken up by principial and interest payments for new mortgages had reached a low in 2020 due to the fall in interest rates in response to the Covid pandemic. However, since then there has been a significant increase in mortgage payments as a share of income due to interest rate rises. From a low of 15.7% in Q3 2020, for home movers the share has increased by 2.4% points to 18.2% in Q2 2023, while for first-time buyers the share has increased from a low of 15.3% in Q2 2020 to 19.1% in Q2 2023, an increase of 3.8% points.
In 1983 UK average property prices were 2.7 times that of average earnings. Today, 40 years on, average house prices are over ten times that of the average salary. This makes it incredibly difficult for young people to get on the property ladder, with astronomical rent prices making saving for deposits often impossible.
A young couple with children may well have decided to invest their earnings into a “bigger house”, if they are able, but that doesn’t mean that they then have a large disposable income, for most it’s quite the opposite.
The Council Tax freeze will keep money in household pockets, especially important at the moment when every other bill has risen. This will mean more money staying in local communities to help support local economies, which in turn can sustain local employers and protect jobs.
The Scottish Greens planned to hike Council Tax for everyone in a band E property and above.
Although ALBA Party called on Humza Yousaf to scrap the Scottish Green’s unfair plans, as well as freezing everyone’s Council Tax, the manner in which he announced it was far from ideal.
It was after all a political speech, so what he could have done is announced that all SNP led Council’s will freeze council tax next year. Because that is within his gift - or rather it should be. Then he should’ve challenged all Labour and Tory run Councils to match the commitment, which of course the Scottish Government should make easier by putting in place a fair funding settlement for local government.
He also could have done something that has appeared to be difficult for the Scottish Government as of late, and communicated. Communicated with those the Council Tax freeze will impact, Local Authorities.
Because of the upset he caused, he’s already rowed back to make clear that Council Tax should only be frozen next year. This causes uncertainty and worries for the general public and provides an opportunity for Labour Councillors and for the Greens to bring in hikes in the years to come.
Instead of commentators and politicians always pointing to working people to pay for all our public services it would be good if they could remember just how much land is owned by so few in Scotland. Most of which pay a tiny fraction in tax compared to what the rest of us pay in income tax and council tax.
Ordinary people should not have to choose between extra money in their pockets to help towards the cost of living crisis or being able to attend their local library or swimming pool.
Local Council’s are already crying out for more funding to keep the bin lorries rolling and local facilities open. So it’s only right that the Scottish Government send more money to Town Hall’s across the country to fund the freeze. It will cost a few hundred million on top of hundreds of millions they already need to meet pay claims and inflation. Big numbers indeed so where will this money come from when the Scottish Government is already facing a black hole of having to trim £1 Billion from its spending to set a balanced budget?
We need more revenue so in the upcoming Scottish Government budget they should levy a land tax on the big estates rather than target working people who are already struggling.
This would be better than increasing council tax and income tax, both economically and politically. It would provide the cash to fund the Council Tax freeze much to the upset of the Labour Party and no doubt would have the Tories huffing on behalf of their landed gentry friends. Meanwhile more money in the pockets of the general public, including Scotland’s young people.