Westmorland and Furness Council comes into being as a unitary authority on 1 April covering most of the Lake District and surrounding areas, as part of local government reorganisation. It includes many holiday hotspots where up to a quarter of homes are owned by people who don’t live in the area. This drives up housing costs for both purchasers and renters so local people cannot afford to live where they were born and grew up.
Second home ownership leads to a disproportion of older people in an area, putting a strain on health and social services. It also hits local business, schools and other services, where a quarter of the population disappear for months, especially the winter.
Consultation on second home ownership
In Wales, the assembly is already letting local councils charge three times the usual rates for second homes. But for England, the government is consulting on whether to allow local authorities to dissuade second home ownership by allowing premium rates bills. It is expected to become law soon.
Rural counties like Norfolk, North Yorkshire and Cornwall want to charge double rates. Now Westmorland and Furness have voted to implement such a scheme when it becomes law. The move was revealed on the 13 January when the new authority launched a public consultation on council tax levels.
The consultation comes as the council prepares to set its first budget ahead of vesting day on 1 April this year. Vesting day will see Westmorland and Furness Council replace Cumbria County Council, Eden District Council, South Lakeland District Council and Barrow Borough Council, and take on responsibility for the full range of all local council services.
The document reveals that in Windermere 641 homes, or 14.5%, are second homes. In Lakes Parish, which includes Ambleside, the figure is 538 (20.9%), in Patterdale it is 78 (25.3%) and Matterdale (23.8%).
Proposal to introduce a 100% council tax increase on second homes
The new council proposes a 4.99% rise in council tax for 2023/24, a 2.99% basic increase plus another 2% specifically to help fund adult social care, known as the adult social care precept. It is also being proposed that council tax rates should be harmonised across the Westmorland and Furness area.
But most controversially, the council is proposing to introduce a 100% council tax increase on the area’s 5,440 second homes, doubling the council tax they would pay from April 2024. This would raise between £9mn and £10mn a year extra revenue, out of a total budget of £242mn. The revenue will not be ring-fenced, but council officials say it will be spent on affordable homes and associated services.
Comment from Cllr Jarvis
“These proposals have been carefully thought through and are not being made lightly. Our projections are that the cost of providing essential services will increase by £20 million in 2023/24. The funding we receive directly from government won’t cover that, so we have to look to the local flexibility around council tax levels to generate increases in the council’s income.
“The money raised this way will directly pay for essential local services like waste, highways, parks and leisure and social care, as well as allowing us to make progress in the priority areas we have identified in our council plan.
“We know that many people are finding it harder financially at the moment. That’s why we are planning a generous council tax reduction scheme for people on low incomes, which includes up to 100% relief for those residents most in need of support. This is at a time when many councils have chosen to limit access or reduce the value of the council tax discount they offer.”Councillor Andrew Jarvis, cabinet member for finance
Second home surcharge
Commenting on the second home surcharge, Cllr Jarvis added:
“This is a beautiful part of the country, so we understand why people want to come here. But the huge number of second homes, particularly in some areas, undermines the sustainability of our communities, both by reducing available housing stock and driving up prices for local people, and by making it more expensive and difficult for councils and businesses to provide the essential local services residents expect, especially in winter. It is one of our key council plan priorities to tackle these issues.
“The additional council tax on second homes could generate nearly £10 million of additional income for the area which will help us deliver our priorities, provide assistance to communities most affected and help tackle the affordable housing crisis. We think this makes sense.
“These are all big decisions for our new council to make, but one of our core values is listening to our communities and working with local people on the issues that matter most. That’s why I would encourage everyone share their views on what we are proposing through this consultation.”
People have until 13 February to comment on the proposals. A consultation feedback report will be considered by cabinet at their meeting on 24 February, ahead of a final decision on the council’s 2023/24 budget at the shadow authority meeting on 7 March.
If you live in the Westmorland and Furness area and you’d like to give feedback on the consultation, you can do so here.