Second homes council tax premiums in Pembrokeshire are to drop from the current 200 per cent rate to 150 per cent next financial despite warnings it could lead to a council tax rise next year of as much as 14 per cent.

At today’s October 17 meeting of Pembrokeshire County Council’s full council, two attempts to lower the second homes council tax premium in Pembrokeshire were made, with members hearing the changes could lose the council between £2.6m and £5.2m, and could increase next year’s overall council tax rise to as much as 18.8 per cent.

Pembrokeshire is currently expected to see an 11.14 per cent council tax rise in the next financial year.

Second-home owners, since this financial year, have been paying a 200 per cent premium on their council tax, effectively a treble rate, following an increase from the previous 100 per cent (or double rate) premium.

Under Welsh Government legislation, local authorities are able to increase the council premium on second homes to as much as 300 per cent, effectively a quadrable rate.

Long-term empty properties in the county are also currently charged a premium council tax rate: 100 per cent after 24 months, 200 per cent after 36 months, and 300 per cent after five years.

At the October 17 meeting of Pembrokeshire’s full council, members were recommended to back the premium remaining at the current 200 per cent, with the long-term empty property rates also remaining at the current levels, and to write to Welsh Government asking for a reduction in the 182-day criteria for holiday lets rate relief.

At the meeting, two alternative proposals for a lower second homes premium rate were brought before members; a 100 per cent premium by Conservative group leader Cllr Di Clements, and 150 per cent by Independent Group (IPG) leader Cllr Huw Murphy.

Members were told by director of resources Jon Haswell that a reduction of the premium to 100 per cent would lead to additional financial pressures to the council of £5.2m, which would lead to a predicted council tax increase of 18.87 per cent against an expected general increase of 11.14 per cent.

Cabinet member for finance, Cllr Joshua Beynon moved the recommendations be backed, adding: “Every 25 per cent reduction would reduce the amount raised by the council by £1.3m, already we have a very difficult financial situation, that is the reality of local government finance, we are stretched in terms of demand for services.”

Cllr Clements, in her amendment, said the council was using second-home-owners as “cash cows,” with the revenue raised used to fund the general budget.

“This policy is a blunt tool, for me it’s about fairness and proportionality.

“I question the financial sustainability of this local authority if it relies on these council tax powers; when second home-owners throw in the towel where will the council go?

“In relation to second home-owners the message [we send] is clear: ‘We don’t want you’.”

Cllr Tony Wilcox said that any reduction in the rate for second-home-owners would impact on ordinary council tax-payers in the county.

“Why are we penalising 85-95 per cent of our own people to pander for a political point?” he asked, adding: “The overwhelming majority of our residents aren’t affected by this, we are going to penalise the majority.

“I really can’t see how we are contemplating really high council tax rises for the majority of our county.”

Cllr Clement’s amendment was defeated; Cllr Murphy’s own amendment then being heard, with Conservative group member Cllr Aled Thomas, urging his fellow Conservatives to support the independent group, saying: “This is a half-way step, I would hope the group would put their vote behind the IPG.”

Council leader Cllr Jon Harvey, who said Cllr Murphy had previously been supportive of the 200 per cent rate, warned: “On this proposal we are talking about £2.6m loss to the council, or about three-and-a-half per cent on council tax. What additional services are you prepared to cut, or are you prepared to increase council tax over and above?

“I am not prepared to justify to our residents why I voted to reduce second homes tax and then put that burden or service cuts on them, they certainly will be worse off in my opinion if this goes through.”

After Cllr Murphy’s amendment was backed, a later proposal by Cllr Alan Dennison to change the empty property premium to 300 per cent after two years was deferred, being considered by the council tax working group before coming before Cabinet at its December meeting.

Members also agreed to write to Welsh Government asking them to reduce the 182 days let threshold.

Following the meeting, Tenby’s county councillor for the North Ward, Cllr Michael Williams told the Observer: “I voted to retain the existing second home premium rate, but I’m afraid that due to the change in member numbers, the vote was lost.

“Great play was made by those who oppose the concept that if you can afford a second home you should contribute fairly to the costs of keeping their holiday destination in a fit state for their occasional visits they should contribute to compensate for the social cultural and economic damage such empty properties cause.

“That a large number of these properties are currently offered for sale. My opinion is the increase in properties offered for sale at often ridiculous prices could well be to make use of the legal loophole that allows owners to avoid paying the premium. A sad indication of today’s society.

“Unfortunately many can’t, or wont accept the damage done by empty properties. An example is the rapidly reducing school roles.

“Where I grew up there were a number of children living in my street, now there are none. Can this be a reflection of a healthy society?” he added.

Also, giving her views to the Observer, following the vote, was Tenby’s county councillor for the south ward, Cllr Sam Skyrme-Blackhall, who stated: “Today at Pembrokeshire County Council’s full council meeting, I was faced with a choice. A choice of reducing the second  homes council tax premium or increasing Council tax for Tenby residents and requiring further cuts to be made in Council services.

“I recognise the contribution made to the community by people who own second homes, and in an ideal world I would have supported a decrease but I can't justify that when that means more council tax and more cuts for those of you who live here full time.

“The proposal to reduce the second home tax premium was passed in a close vote. This is going to mean extra rises in our council tax next year and more cuts in our already stretched services.

“We need more homes and better services for local people, that's why I voted the way I did. No matter how hard, my priority will always be the residents of Tenby,” she added.

Ex-Mayor of Tenby, Tony Brown remarked: If I’m paying 14 per cent more and they [second home owners] pay 50 per cent less, then I think it’s only fair county councillors have a wage freeze for the next 5 years to balance the books!”