Council warns of 'bankruptcy' without 25% tax hike

A local authority has warned it could go effectively bankrupt without a "significant council tax increase".

Leaders at the Royal Borough of Windsor and Maidenhead (RBWM) have proposed a 25% hike as part of draft budget plans.

The issue is set to be discussed by councillors on RBWM's corporate overview and scrutiny panel on Monday.

Liberal Democrat and independent council leaders have asked the government for permission to increase council tax beyond the usual cap of 4.99%.

"Without a significant council tax increase above the capped level, aligned more closely with the borough's neighbouring areas, the council is unable to reach financial sustainability," the draft budget says.

The request is part of an appeal for exceptional financial support from the government.

RBWM is more than £230m in debt – and says it spends £18.6m a year on interest and repayments, the Local Democracy Reporting Service said.

The government may not make a formal decision until as late as the end of February – potentially just days before the council has to set its budget.

Council leaders have warned if they fail to get the support they may have to declare effective bankruptcy.

Speaking in December, RBWM's deputy chief executive Kevin McDaniel said this meant the council was having to draft spending plans without knowing for sure it would have the money to fund them.

The final budget will be voted on by all councillors on 5 March.

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