Budget, council tax and adult social care precept

Find out more on the latest budget position, including council tax and an explanation showing how adult social care precept is calculated.

Budget

From 1 April 2023 there will be a new single council in North Yorkshire, providing all the services you are used to receiving. The new North Yorkshire Council will replace the seven district and borough councils as well as the county council. All eight councils are already working together to make sure that the services you value continue as usual when North Yorkshire Council comes into being on 1st April 2023. Having one council means these services can be strengthened and joined up to improve the quality of life and opportunities for people across North Yorkshire. It will also save money by reducing duplication to put back into frontline services and support local priorities and decision-making. The council tax bill you receive this year will be the last one from your current council. The next bill you receive will come from the new North Yorkshire Council. Find more information about the new council, including answers to frequently asked questions.

Explaining our budget for 2022/23

In February 2022, we agreed a budget for the financial year 2022/23 after we asked North Yorkshire residents to help us decide how to manage and prioritise our finances as part of our annual budget consultation. You can access the detailed budget documents here. 

We’re still facing major uncertainties as a direct result of the Covid-19 pandemic and limited visibility of the government’s spending plans. Given these difficulties, it’s critical that we have as much flexibility as possible in order to protect vital services whilst still being able to respond to further challenges ahead.

Since 2010, our spending power has decreased significantly. Government funding has reduced and demand for services has increased. As a result, every £1 we had to spend on services in 2010 has now fallen to around 60p.

Despite using our reserves and finding even more areas where we can make savings without compromising frontline services, we need to increase council tax to meet this increasing demand. In February 2022, county councillors voted for general council tax to increase by 1.99% along with an increase in the adult social care precept of 2%. The overall 3.99% increase will be equivalent to just over £4.69 a month for an average household or £1.08 per week.

Where does the council's money come from and where will it be spent?

Our funding comes from a number of sources. This includes central government, council tax, business rates and fees and charges on services we provide. The table below reflects the gross income to be received in 2022/23:

Funding

2022/23
£m

%

Fees/charges

136

20

Government grants and joint funding

133

19

Council tax income

352

50

Business rates

68

10

Use of reserves

8

1

We plan to spend £696m on providing services to our residents. The total gross expenditure for 2022/23 is allocated as follows:

Directorate Gross Expenditure

2022/23
£m

%

Health and adult services

300

43

Business and environmental services

130

19

Other e.g. libraries, support costs etc.

155

22

Children and young people’s services

112

16

Schools are funded by a dedicated schools grant from central government and £490m has been allocated in 2022/23. This amount includes both maintained schools and academies but excludes sixth form funding and pupil premium.

Given the continued risk and uncertainty, the budget includes a contingency to meet demand and growth pressures that are likely to happen but can’t be predicted.

We plan to spend £83.2m on capital projects during 2022/23. Capital spending comes from a separate 'pot', which is financed from a combination of grants and contributions, borrowing, revenue budgets and capital receipts from the sales of properties.

Capital spending by service

 

2022/23
£m

Business and environmental services

Highways infrastructure

(including roads, bridges and major highways schemes)

30.4

Transforming cities programme

14.5

Flood risk management

0.6

Other improvement schemes

0.3

 

45.8

Children and young people's services

Schools

28.1

Other improvement schemes

(Outdoor learning service)

0.3

 

28.4

Central services

IT infrastructure

0.7

 

Council property

0.6

 

Other provisions

7.3

 

 

8.6

Health and adult services

Adult social care property

0.4

Overall county total

 

83.2

Demand and cost pressures mean we continue to face difficult decisions about spending over the coming years. Below are some of the reasons for changes in costs we are currently facing.

How our expenditure has changed

£m

Budget 2021/22

Starting position

400.2

Inflation and effect on living wage

Price rises and the impact of tax changes imposed by the government increase our costs.

20.4

Other additional spending

Additional spending due to an increasing demand for services and to meet our polices and priorities.

3.1

Savings plan

-3.7

Other funding changes and government grants

6.1

Contributions to/from county council reserves

Planned contribution to reserves

-4.6

Total net increase in spending

Overall increase in expenditure from prior year

21.3

Budget 2022/23

421.5

Adult social care precept

Since 2016/17 the Government has allowed local authorities to charge an additional ‘precept’ on top of their core council tax charge to help pay for adult social care services.

What is the adult social care precept for?

The adult social care (ASC) precept is a portion of council tax which is set aside specifically for adult social care services. In the last financial year, we directly supported 12,480 older people and younger adults, including people with learning disabilities, physical disabilities and mental ill health. Adult social care services are delivered in a number of different ways including prevention and supporting people to live independently in their own homes as well as residential and nursing care.

We spent almost £289m on adult social care services in 2021/22, supporting people to live longer, healthier, more independent lives. We currently receive around 72,000 enquiries every year relating to adult social care and demand for services is increasing.

Government legislation

The Secretary of State made an offer to adult social care authorities. (“Adult social care authorities” are local authorities which have functions under Part 1 of the Care Act 2014, namely county councils in England, district councils for an area in England for which there is no county council, London borough councils, the Common Council of the City of London and the Council of the Isles of Scilly.)

The offer was the option of an adult social care authority being able to charge an additional “precept” on its council tax without holding a referendum, to assist the authority in meeting its expenditure on adult social care from the financial year 2016-17. It was originally made in respect of the financial years up to and including 2019-20. If the Secretary of State chooses to renew this offer in respect of a particular financial year, this is subject to the approval of the House of Commons. As part of the 2021/22 local government finance settlement it was announced that local authorities have been given the flexibility to levy up to 3% adult social care precept, which can be spread over two years and a further 1% has been announced for 2022/23.

For 2022/23, the adult social care precept has been increased by 2% of the total council tax charge made for our services for the previous year (2021/22). This was approved at the full council meeting on 16 February 2022. We have illustrated how the Adult Social Care precept is calculated with an example below using a B and D property.

2021-22

 

North Yorkshire County Council - Band D

£1,270.74

Adult social care precept

£140.31

North Yorkshire County Council total

£1,411.05

 

2022-23

 

North Yorkshire County Council - Band D

£1,298.82

Adult social care precept

Calculated as -

£1,411.05 (21/22 total charge) x 2% = £28.22

Cumulative adult social care charge £140.31 (21/22 ASC) + £28.22 = £168.53 (22/23 adult social care charge)

£168.53

North Yorkshire County Council total

£1,467.35

How can I check the figures?

If you are checking the 2022/23 precept on your own council tax bill, you will need both the 2021/22 and 2022/23 bills in front of you. Remember that the increase in the adult social care precept is calculated from the total amount of council tax charged only for North Yorkshire Council services the previous year.

To check your 2022/23 Adult social care precept:

  • Add together the amount for “North Yorkshire County Council” and “Adult social care” on your 2021/22 bill to get the total amount for North Yorkshire County Council services. 
  • Calculate 2% of this total amount.
  • Add the 2% figure you have calculated to the 2021/22 adult social care amount. The result is the adult social care Precept you are being charged for 2022/23.

Although everyone benefits from some county council services such as highways and transport, only those with children will receive education support and most people would like to remain sufficiently independent and healthy so that they never need council support such as residential care. However, it is often these statutory services, which benefit the smaller number of people that cost the most. Similarly, the adult social care precept is part of council tax rather than a service charge and so is not linked to whether or not you receive social care services. You could think of council tax as an insurance premium. You hope you will never have to claim but you have the comfort of knowing that if you, or a member of your family, need to then there will be support to help you.

Council tax

Your council tax contributes to the services we provide, and the services your district, borough or parish council provide as well as the police, fire and rescue.

Council tax is collected by the district or borough council. The money raised is spent by various bodies including the county, district, parish and town councils, to provide services to each local community.

You will usually receive your council tax bill in March of each year, if you are 18 or over, and own or rent a home.

For 2022/23 our Band D charge has been set at £1,467.35 – that’s an increase of 3.99% on the charge for 2021/22. Of this increase, 1.99% relates to general council tax and 2% to adult social care precept.

All households have a property band between A and H, which is allocated based on the value of the property. The amount you pay depends on which band your home is in.

Which council tax band is my home in?

There are two elements to the council tax which pays for county council services, the general council tax and the adult social care precept. The 3.99% overall increase for 2022/23 is made up of a 1.99% general council tax and a 2% adult social care precept.

The table below shows how much you will pay.

Property band

Basic council tax excluding adult social care

Adult social care precept

Total

A

£865.88

£112.35

£978.23

B

£1,010.19

£131.08

£1,141.27

C

£1,154.51

£149.80

£1,304.31

D

£1,298.82

£168.53

£1,467.35

E

£1,587.45

£205.98

£1,793.43

F

£1,876.07

£243.43

£2,119.50

G

£2,164.70

£280.88

£2,445.58

H

£2,597.64

£337.06

£2,934.70

Contact your district or borough council for information about the full amount you will pay each year. Find your local council on GOV.UK.

The council tax bill you pay to your borough or district council contributes to the combined cost of the county council, district/ borough council, parish council, police and fire services.

For the county council that includes services such as adult social care, public health, roads, street lighting, winter maintenance, children’s social care, disposal of waste collected by borough and district councils, libraries and emergency planning, support services to schools such as school transport and special educational needs. The combined cost of the services we provide as a county council will be over £1 billion in 2022/2023.

In North Yorkshire, council tax is managed by your local district or borough council, including the parts of the council tax that are for North Yorkshire County Council services. 

Your district or borough council handle account queries, annual notifications, appeals, backdated claims, band reductions, discounts, exemptions, overpayments, new benefit claims and benefit renewals. They also deal with any changes in personal or financial circumstances that may affect benefit claims, and discretionary housing payments. You can find out more information on the relevant website for your area - Find your local council on GOV.UK.

Frequently asked questions

The council tax bill you pay to your borough or district council contributes to the combined cost of county council, district/borough council, parish council, police and fire services.

In North Yorkshire, local government services are provided by the county council and borough/district council. The table below provides an overview of which service is provided by which council.

County council

District council

Schools

Leisure centres

Children's social care

Bin collections and street cleaning

Adult social care

Council tax collection

Adult learning

Local planning

Public Health

Environmental health

Roads, footpaths and street lighting

Housing

Public transport

Parking

Waste disposal

 

Household waste recycling centres

 

Libraries

 

Trading standards

 

Births, deaths and marriages

 

The government sets out the rules on how much councils can increase council tax. For 2022/23 the government confirmed the limit for increases to core council tax at 1.99%.

In 2015 English councils were given the power to increase council tax to pay for social care services for adults. These are services, which help people with physical, learning disabilities, or mental health needs to carry out their daily routines. In the 2021/22 local government financial settlement, the Government announced additional flexibility allowing councils with adult social care responsibilities to levy an additional 3% precept. Councils were given the option to spread any agreed increase over two years. In addition, the 2022/23 local government finance settlement extended the adult social care levy further by allowing another 1% to be applied in 2022/23.

We increased the adult social care precept by 1.5% in 2021/22 with the option to carry forward the remaining 1.5% to 2022/23 if required. This combined with the additional 1% announced in December 2021 meant we could increase the adult social care precept by up to 2.5% for 2022/23.

If we want to increase it by any more than these levels set by the government, we must hold a local referendum.

Local authorities are required by law to have a balanced budget. That is a financial plan based on sound assumptions which shows how income will equal spend over the short and medium-term. Plans would take into account deliverable cost savings and/or local income growth strategies as well as usable reserves.

Reserves are like household savings. The money has been put away to pay for something in the future like a car or as a resource for emergencies such as when the boiler breaks down unexpectedly.

There are two types of council reserves:

  1. Earmarked reserves – these are already committed to be spent. 
  2. General reserves – these are for responding to unexpected events such as major funding issues.

The amount of general reserves would be enough to fund the council for just 25 days if all funding was to stop. Also with reserves, you can only spend them once. If they are gone, we would be exposed to the risk that if some serious unexpected expenditure is necessary, the money just won’t be there.

Our capital budget is spent on fixed assets. That includes new buildings and major refurbishments, buying land or buildings and investment in shares or bonds. The capital budget can be funded from the revenue budget, through borrowing within strict parameters set by government or from capital receipts. We can only borrow to support the capital budget not to pay for everyday services. Capital receipts such as the sale of assets can only be used to either repay debt or to support the capital budget.

So if, for example, we were to sell County Hall, the money received would be a capital receipt and could only be used to redeem debt or for the capital budget. It could not be used for funding social care or home to school transport costs or other revenue funded services. Redeeming debt might sound like a good option, except of course interest rates are still low and we have to pay significant penalties for paying off debt early.

On 3 February 2022, the government announced support to help households with rising energy bills including a £150 Council Tax rebate for those homes in Council Tax Bands A to D. If you have any queries relating to the Council Tax Energy rebate please contact your local billing authority, details of which can be found here -  Find your local council on GOV.UK.