Wednesday, January 10, 2007

Council tax rise to plug Olympic shortfall?

Council taxes may go up soon.

Apparently Ken Livingstone will soon come under pressure regarding the £900m shortfall in funding the Olympics.

The original deal, as set out in the Memorandum of Understanding, is that any shortfall would be met either by the Lottery or council tax. However, the Big Lottery Fund has expressed its unwillingness to pay any extra.

Ken Livingstone has repeatedly vowed that he would not increase council taxes beyond 38p per week to pay for the games. The thing is, can we trust him to keep his word? Remember his promise to save the Routemaster? Remember his ancient promise to freeze tube fares in real terms for four years? Remember his promise not to raise the congestion charge for ten years?

Judging by his past record, don't expect Ken to keep this latest promise. Expect your council tax bill to go up. If it does not, I will be very surprised.


CityUnslicker said...

I think there is a great chance for a new Tory mayor to hold the government to ransom to extract more lottery money.

Why should the lottery money sit unspent while new taxes are raised? The original purpose of the lottery was exactly for purposes such as this.

Tony said...

Congratulations on your maiden ABK voyage Bel.

Given my comments tonight about Livingstone's devil-may-care attitude to London taxpayers, I think there is a very good chance that the 38p committment will be consigned to the dustbin of history along with his other 'promises'.

London, your little bit of Cuba in the glorious south east of England...

Bel said...

Surely it's not too late to give up the idea of hosting the Olympics?

John East said...

Our Ken can easily keep his promise, simply by increasing London's debt. After all, in today's world debt financed wealth is defined as wealth.

For example, the interest payments on an overspend of £900M spread over 3 million dwellings only works out to about 5p/week/household.

The final overspend, probably several £billion, will still be financed by interest only payments within his 38p limit.

The fact that the underlying debt will probably never be paid, and lead to a financial crisis in 15 or 20 years time won't be Ken's problem.