The recommended hike will be put to all councillors at the annual finance meeting on 17th February after the proposal was agreed by cabinet members.
If agreed, it would push up the county council’s portion of the bill on a Band D property by just over £58 to £1,514.29.
The increase will be made up of a 1.99 percent rise which can be spent on all council services - and is the largest amount by which local authorities are allowed to increase council tax without a referendum - and a two percent uplift which is ringfenced for adult social care.
The increase in adult social care “precept”, as it is known, has been set by the government this year at a maximum of one percent, but councils are also allowed to levy any part of the rise which they did not deploy last year. During the 2021/22 budget-setting process, the ruling Conservative group amended the recommendation to full council in order to utilise only two out of the then three percent precept which was permitted - allowing them to carry over the unused one percent for the 12 months ahead.
The government this week announced a £150 rebate on the council tax bills of all Band A-D households.
County council cabinet members were told that demand and inflationary pressure are putting particular stress on adult social care services at the moment - and the authority has built in an additional £92m over the next three years to support delivery of them.
Deputy county council leader Alan Vincent said that other authorities were facing similar challenges and that Lancashire was “not on [its] own”. He added that demand and inflation had both increased by the end of the third quarter in December.
County Cllr Vincent, who is also the cabinet member for finance, confirmed a previous prediction that the authority would not meet its savings target of £42m by 2022/23 - a figure which includes savings that were not delivered in 2020/21, because of the pandemic. Papers presented to the meeting reveal that £8.5m of the total will not now be delivered until 2023/24.
"We will push hard to achieve those savings and we would hope to identify new savings over the next couple of years to try and get back on track - but that will be extremely difficult to do in the short term," he told the meeting.
However, County Hall’s forecast budget gap by 2024/25 has fallen to an estimated £42.8m - down by £15.7m from the predicted position last November - partially as a result of the government's spending review late last year. The authority is also expecting to hold £204m in reserves by the end of March this year, which will be sufficient to meet any shortfall over the medium term.
COUNCIL TAX BREAKDOWN
If the recommended 3.99 percent council tax increase is approved, the Lancashire County Council share of the bill in all areas of the county except Blackpool and Blackburn will be as follows for 2022/23.
Band A - £1,009.52 (up £38.73)
Band B - £1,177,78 (up £45.19)
Band C - £1,346.03 (up £51.64)
Band D - £1,514.29 (up £58.10)
Band E - £1,850.80 (up £71.01)
Band F - £2,187.32 (up £83.93)
Band G - £2,523.82 (up £96.84)
Band H - £3.028.58 (up £116.20)
*The above figures do not include the council tax charged by district and parish or town councils, nor the police and fire services.