‘Failing’ Combined Authority accused of being ‘lazy and wrong’ as it imposes new tax on Cambridgeshire residents
Additional reporting: Hannah Brown, Local Democracy Reporter
The Combined Authority has agreed to impose a new tax on the residents of Cambridgeshire and Peterborough - a day after warnings from the government about its failures emerged.
The average Band D household will pay a new £12 mayoral precept this year towards bus services that have proved commercially unviable.
The decision, approved by votes from Labour and Liberal Democrat board members, was described as “lazy and wrong” by Conservative members, who said the charge was neither necessary or wanted.
They proposed alternatives, including cutting some projects, bringing forward savings, using reserves and cutting 10 bus services that they said was costing the authority around £87 per return journey.
But their amendment was voted down and the charge approved, with the suggestion of cutting bus routes described as “heartless”.
A survey on the Combined Authority’s financial plans was previously criticised for failing to be clear about the plans - and attracted only 230 responses from an area with a population of nearly 900,000 people.
After today’s vote, Labour’s Cllr Anna Smith, currently acting mayor of the Combined Authority while Dr Nik Johnson is on medical leave - said the decision had “not been taken lightly”.
Cllr Smith, who is also leader of Cambridge City Council, said: “The responses to the Medium Term Financial Plan survey were carefully considered as part of the debate. We know that this is an incredibly difficult time for everyone, and that during a cost of living crisis adding a precept of even £12 for a band D property will be hard to hear.
“However, we also know that buses have a great impact on the region as a whole and even those who do not use their services reap their benefits. For every £1 invested in local bus priority measures, up to £7 of net economic benefit is delivered.”
The decision comes the day the government issued a formal notice to the Combined Authority demanding improvements after “significant weaknesses” in governance arrangements were highlighted by external auditors last year.
Max Soule, of the Department for Levelling Up, Housing and Communities (DLUHC), said a failure to “demonstrate continuous improvement” could result in government intervention.
The Combined Authority says work on its improvement plan has been under way for several months. Meanwhile, a probe into the conduct of mayor Dr Johnson remains ongoing.
A report presented to today’s board said the new mayoral precept - which is allowed under the devolution deal agreed by the Conservative government - was expected to raise £3.6million in 2023-24.
It said the precept was being proposed due to “pressure facing the Combined Authority across its supported bus services”.
This arose when Stagecoach East cancelled a raft of services last October when they proved commercially unviable, and Combined Authority agreed to step in and fund a number of them, with multiple operators.
The report said the cost of the new services was “considerably higher” than the services they replaced, due to increase in fuel, energy, and driver costs.
It told members: “Implementing a mayoral precept, of £1 a month (£12 annually) on a Band D property, would help to safeguard the services which are critical for some residents of the Combined Authority to work, learn and participate in society for the medium-term, while the authority continues to develop the case for franchising in coordination with Greater Cambridge Partnership to incorporate the results of their work around Cambridge.”
It added that the funding would be “ringfenced” to support passenger transport services in the area and would not be used to support the authority’s core costs.
The Combined Authority previously missed out on funding available from the government when it submitted its Bus Service Improvement Plan (BSIP) in 2021.
A message from Dr Johnson was read out at the meeting in which he said the Combined Authority needed to create a transport system “residents in the region deserve”.
He added a decision to add a pound a month to council tax bills was not “taken lightly”, but said the proposed precept would “save for another year the bus routes that matter so much to our residents”.
But the three Conservative board members argued strongly against it.
Cllr Chris Boden, the leader of Fenland District Council, said the authority needed to “ensure best value” when spending public money on bus services.
He said: “There is no need for us to have a mayoral precept this year. Not only is it not needed, it is not wanted.”
Cllr Boden said the authority had “significant reserves” and had some “flexibility”, highlighting that a number of projects included in the budget had yet to be formally approved.
He noted the majority of people who responded to the survey on the proposed budget did not support the precept.
Cllr Anna Bailey, leader of East Cambridgeshire District Council, said: “Taking money from people’s pockets with the force of law, particularly in a cost of living crisis, while not doing everything possible to avoid it is lazy and wrong.
“The Combined Authority should live within its means and taxpayers should not pay for the failures of the mayor.”
She said additional money from the mayoral precept would not improve buses but would be used to “keep the status quo”.
Cllr Bailey said: “The purpose of devolvement is to receive powers and funding from government to implement decisions. It is not supposed to be a new method of taxing.”
Cllr Bridget Smith, the Liberal Democrat leader of South Cambridgeshire District Council, said the Tories’ proposed amendment to cut 10 bus services was “heartless and uncaring”.
She said the majority of the buses on the list proposed to be cut in the amendment were in South Cambridgeshire, describing it as a “hit list”.
Cllr Smith said the precept was to pay for buses and said the board knew that people wanted buses.
She highlighted that they had heard from people about the consequences of not having buses, including young people not being able to get to school or places of work.
And she said she had received messages from elderly people “begging” her to help keep their bus services.
Cllr Smith said the board had all been “outraged” by the Stagecoach cuts and had supported the temporary measure to fund some of the services. She said if the services were to continue then the “money has to come from somewhere”.
Cllr Lucy Nethsingha, the Lib Dem leader of Cambridgeshire County Council, highlighted that the money the Combined Authority received from government was a cash settlement, which she said with inflation levels high meant the authority’s spending power was “reducing”.
She said if the authority was to only “manage on money it was given” it would “effectively have to do less and less every year”.
Cllr Nethsingha recognised the precept was a “new burden”, but said people recognised the need to change the way the public transport system worked.
She said: “It is an important step forward in a vision towards an area where public transport can be more reliable and more climate friendly.
“Most importantly of all for those who live in rural areas do not face constant increasing disadvantage, disadvantaged in getting education and work.”
What you will pay to the Combined Authority in 2023-3
The breakdown of what this charge will be across the different bands is:
- Band A - £8
- Band B - £9.33
- Band C - £10,67
- Band D - £12
- Band E - £14.67
- Band F - £17.33
- Band G - £20
- Band H - £24
Meanwhile, taxpayers can expect bills from most councils to rise, with the exception of East Cambridgeshire District Council, which is freezing its bill for the tenth year running.
Cambridgeshire County Council, which makes up the majority of the council tax bill, plans a 4.99% rise, which will add £73 to the average Band D bill.