Boris Johnson has been accused of dodging the chance to help hard-up Londoners by cutting the Greater London Authority share of the council tax, opting instead to use excess funds in order to build up “a war chest of reserves” to used as part of an election year tax cut.
The accusation was been made by Liberal Democrats on the London Assembly after the Mayor’s final draft budget was approved by AMs yesterday.
As City Hall officials hailed his budget as an “unprecedented second freeze in City Hall’s share of council tax”, the Mayor claimed it was a budget that exemplifies the time in which we live.”
Under Johnson’s budget the total GLA precept is set to remain at £309.82 a year for a band D household.
Commenting on a series of GLA Council Tax precept rises under his predecessor, Mayor Johnson said: “Over the years we have seen an exorbitant level of waste and weak financial controls at City Hall that have cost Londoners dearly. The era of endless tax rises has had its day. Over the last two years, we have proved that it is possible to still deliver on frontline services without extravagant spending.”
However Liberal Democrat Assembly leader Michael Tuffrey said the Mayor’s “approach to budgeting is putting electioneering before good stewardship of Londoners’ money.”
Tuffrey said “careful analysis of the Mayor’s budget” revealed he was failing to pass on potential cuts in the precept this year so he could build up ” a war chest of reserves, no doubt to use for a tax cut before the 2012 elections.”
Expanding on his accusation, Mr Tuffrey said: “This year [the Mayor] has cut the precept income going to the Met by £16m and switched it to Fire where reserves are now £30m more than needed. He even put the £6m ‘windfall’ income received last week from the Council Tax revaluation straight into GLA reserves.
“In total he is now sitting on a war chest across the GLA of a staggering £858m in reserves and contingencies, up £148m from last year.
“Of course some reserves are vital for prudent finanical management, but holding on to nearly a billion pounds of Londoners’ money when they are enduring this grim recession is a scandal.
“Instead the Lib Dems want the Mayor use these reserves to invest in frontline services, restore the cut in police numbers and give some back to hard up Londoners by reducing the council tax burden this year.”
Although the Mayor’s share of the Council Tax has not increased, the cost of his administration has risen for millions of public transport users who have seen the majority of fares, especially bus fares, increase since he came to office.