Clegg outlines council tax plan

3 July 2008 07:28am

Local councils should be able to raise three quarters of their cash from local people and businesses, Liberal Democrat leader Nick Clegg is to tell town hall chiefs.

He will use a speech to the Local Government Association to push his party's proposals to replace council tax with a local income tax and "relocalise" business rates.

Communities and Local Government Secretary Hazel Blears and Tory leader David Cameron are due to follow him on the platform at the LGA's conference in Bournemouth.

Mr Clegg will accuse them of only "talking the talk" about empowering communities and warn that too much Whitehall control slows the pace of change in local services.

"The great experiment of trying to improve our public services for everyone by pouring money in through a tight funnel in Number 10 Downing Street has failed," he will say.

"The Liberal Democrats are committed to scrapping council tax. It's Britain's unfairest tax. Based on property values nearly 20 years ago, instead of what people can afford to pay.

"But our commitment to local income tax isn't just about fairness, it's about localising power, too. Because with a local income tax in place, we can decentralise our tax system, transferring tax-raising powers from national to local government.

"My ambition is to switch from a regime where councils raise just a quarter of the money they spend, and get the rest in handouts from the centre.

"To a regime where they get a grant for just a quarter of the money they spend - and get the rest from local taxes, decided by local people."

Mr Clegg will also attack Prime Minister Gordon Brown's move to appoint ministers to represent English regions - claiming the "futile project" could cost taxpayers up to £2 million.

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