Havering Council is bankrupt. The usual explanation is the cost of Adult Services and Homelessness. That’s glib. Council Tax was introduced in 1991 by a panic-stricken Conservative government reeling from the Poll Tax riots. They planned valuation reviews every five years, after which council tax would be recalibrated reflecting property price inflation. No reviews have taken place. Areas with massive property price inflation, like Havering, haven’t had council tax adjustments.
Havering’s Council Tax 2025
In 1991 a £320,000+ band ‘H’ house1 in Havering had a council tax of £1070. This equates to 0.33% of its minimum value.
In 2025 a band ‘H’ property is worth about £2m.3 Council tax for band ‘H’ is £4,627, which is 0.23%. This doesn’t look much but it is a 30% difference.
Council tax has significantly reduced for band ‘H’’ property owners since 1991.
Inflation since 1991
Band ‘H’ houses were valued at £320,000+ in 1991. Using standard inflation, that increased to £733,720 in 2025.4 House price inflation is a multiple of standard inflation. A 1991 £320,000+ house is now £2,157,601,5 an inflation rate of 574%.
Council Tax is a failure
Political cowardice by governments has bankrupted Havering.6 Council tax is a failed mechanism for funding council services.7 Continuing to use 1991 valuations is ludicrous.
Correcting 34 years of inertia will take political courage………I’m not holding my breath.
Notes
1 Council Tax bands and bills | London Borough of Havering
2 Properties For Sale in Emerson Park | Rightmove
4 Inflation calculator | Bank of England
5 House price index | Nationwide
6 Havering Council Tax: Is It Too Low? – Politics in Havering This was written in 2020 but the analysis is still valid though the examples are historic.
7 George Osborne’s Age of Austerity programme, 2010-16, put the knife to the throat of Havering’s finances and matters more than sub-optimal increases in council tax.
Politics in Havering 
House price inflation is welfare for the asset rich, except many are cash poor, so raising council tax is not a realistic solution as its unaffordable, unless ways can be found to release the asset value.
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Council tax is a property tax and as such disregards the ability to pay. Living in a house that you can’t afford produces stresses but there are ways of getting out of the problem.
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So your solution to poor funding due to e.g. unfunded statutory duties, government prioritising wasteful “Net-Zero” and war with Russia is to raise council tax irrespective of ability to pay as residents have an option to downsize and emigrate?
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*poor funding* This bog discusses the failure to reflect on fact that council tax is a property tax, which is, therefore, based on fluctuating values. Wider issues about the *use* of tax money is different and beyond the scope of a very short blog.
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