Angela Rayner Delivers a Crushing Blow to Hardworking Brits with Massive Council Tax Hike
Deputy Prime Minister Angela Rayner has approved council tax increases of up to 10% in some areas, allowing councils to raise taxes without a public vote.
At the same time, a significant portion of taxpayers’ money—around £230 per household—is being used to fund generous public sector pensions, which many private-sector workers do not receive. In 2024, councils spent a total of £7 billion on these pensions, with some redirecting nearly half of their budget to pension funds.
Birmingham City Council, one of the biggest spenders, contributed £141.7 million to pensions while struggling with financial difficulties. More money is going to pensions than to crucial services like emergency housing (£2 billion) and libraries (£1 billion). These pensions are often based on final or career-average salaries, benefits that are no longer common in private companies due to high costs.
Public sector workers can access their Local Government Pension Scheme (LGPS) from age 55, with payments increasing yearly based on inflation. Over 7,600 former council workers receive pensions of more than £50,000 a year, while 203 top executives enjoy more than £100,000 annually—funded by council tax.
Over the years, public sector pensions have created a debt of £5 trillion. Reform Party leader Nigel Farage has warned that this is a serious financial issue for the UK. Meanwhile, new tax rules coming in 2027 will affect private pensions while leaving public sector pensions largely untouched, increasing the divide between the two.
Currently, 1.16 million people work for local councils, while 6.8 million retired workers receive LGPS pensions. The rising costs of maintaining these pensions raise questions about how many council jobs are truly essential.
DEI Spending in Local Government
A recent report found that 6,000 public authorities employ 10,000 Diversity, Equity, and Inclusion (DEI) officers, costing UK taxpayers £557 million a year. Birmingham City Council alone spent £450,000 on DEI staff last year.
In the U.S., former President Trump launched a government cost-cutting program, putting all DEI staff on paid leave with plans to remove them permanently. Billionaire Elon Musk, leading the initiative, aims to cut U.S. government waste and reduce the federal deficit by $1 trillion.
If the UK were to take similar steps, Chancellor Rachel Reeves could have more funds available for tax cuts to help boost the economy. However, the Labour Party, which traditionally supports the public sector, prefers to maintain spending in this area.
What’s Next?
Despite the financial strain, the LGPS is currently running an £85 billion surplus. The plan is to use this to reduce employer pension contributions, which reach up to 27% in some councils. However, this may not translate into lower council tax bills for residents.
As the UK grapples with rising costs and increasing public spending, the big question remains: how long can taxpayers afford to support such a costly system?
