Dispute over second home tax revenue rumbles on

Second home owners could have their council tax bills reduced if an angry row between two Norfolk councils continues to escalate.The dispute between Norfolk County Council and North Norfolk District Council centres on where to spend the 'extra' millions of pounds generated from an optional levy on second home owners.

Second home owners could have their council tax bills reduced if an angry row between two Norfolk councils continues to escalate.

The dispute between Norfolk County Council and North Norfolk District Council centres on where to spend the 'extra' millions of pounds generated from an optional levy on second home owners.

Currently north Norfolk, along with other district and borough councils, benefit from the money as they take, in various forms, a fairly hefty share of the countywide total of �3.3m collected annually under the scheme.

But on Monday the county council cabinet voted to redirect some of this money, around �829,000 a year, away from issues considered as key in the districts such as affordable housing and into a new Norfolk Infrastructure Fund to be spent on growth projects in Norwich, King's Lynn and Thetford.


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Both the decision itself, which has left holes in planned local authority budgets, and the speed at which it was taken has infuriated councillors in various parts of the county, but particularly in north Norfolk, which has around half of the county's second homes.

That anger has already led to steps to have the cabinet decision called in to the cross party scrutiny committee at County Hall.

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But North Norfolk District Council has also said in the future it may consider refusing to collect the extra money at all because it is in the district's gift to decide whether to make the charge to second home owners.

This would mean neither council would benefit from the cash - and second home owners would have cheaper bills.

'We could indeed do that,' said district council leader Virginia Gay.

'There was no discussion or consultation about this and that raises longer term concerns about process as well as the immediate concern about this money.'

Although the decision to stop collecting the special levy looks unlikely at this stage because it would hit budgets across both authorities, there are further concerns at district and borough level that the county council could target more or even all of the second homes monies.

Monday's cabinet papers raised this threat by saying the county council: 'may wish to review the use of the total second homes monies collected each year'.

Graham Jones, a district and county councillor in north Norfolk, added: 'This is a very serious issue for the concept of fairness and openness in local government and I believe that we have to take a stand.'

At Monday's meeting county council leader Daniel Cox said his priority as leader of the council was to 'make this money work for the most people in the county'.

Every district or borough council can choose to charge second home owners anywhere between a baseline 50pc of the standard council tax bill, or anything up to 90pc.

If they choose to charge the extra, the money goes into specific pots. In the current financial year a total of �3.3m should be collected under the scheme.

In Norfolk the arrangement since 2005 for distributing the new levy has seen half the money reinvested into communities through local strategic partnerships, while half is retained by Norfolk County Council.

But the county's ruling cabinet agreed on Monday to re-allocate half of its share, so a quarter of the total equivalent to about �829,000 a year, towards the new Norfolk Infrastructure Fund.

This decision will have to be passed by the county's full council at a future meeting if it is to become policy.

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