Council tax is going up in Richmond to help fill the gap left by government underfunding of special needs education, according to one of its finance chiefs.

Richmond, which already demands the second-highest council tax payments in London, is increasing council tax by 4.99 per cent – the maximum allowed without triggering a referendum.

Of this, 2 per cent will pay for adult social care with the rest paying for other services.

Meanwhile, Richmond spends £30million on special educational needs (SEN) in schools but is given £25million by government.

This leads to difficult decisions, as Councillor Robin Brown, cabinet member for finance, explained.

He said: “We stood back and looked at the state of the council finances.

“If we can avoid it, we don’t want to make cuts to the front-line services that people rely on. We don’t want to be closing libraries or children’s services.”

He believed the government should be paying for schools, but because the funding formula for SEN is partly based on levels of deprivation, Richmond loses out per pupil compared to other boroughs.

“There might be some correlation between higher deprivation and higher special needs,” Cllr Brown said. “But it’s not one-for-one.

“Rightly, parents are very keen to get the provision for their children that they deserve.

“We can’t not provide those services for children and young people. We have to step in to fill the gap, but that’s huge.”

Richmond’s current £30million spend on SEN in schools, while the government gives them £25million, leaves a £5million gap to plug.

And that gap is set to increase, he said.

Cllr Brown said: “It’s a national problem, but we’re feeling it very keenly in Richmond.

“We are doing all we can to lobby the government, and they gave us a small amount of money extra – but it’s not enough.”

The increase means council tax for a band D home will rise to £1,483.21 a year – up by £70.50 – plus a £320.51 portion set by the Mayor of London.

But some of the borough’s least well off will have to pay less than they do currently – Cllr Brown said he was “proud” to be reversing a charge to some people who are “just about surviving” on benefits.

They will no longer have to contribute anything in the way of council tax – this year they had to pay 15%.

He said: “People who are already struggling, quite often because of problems after they are moved onto Universal Credit, they get into arrears and debt collection, pushing that spiral.

“We support the overall thrust of Universal Credit, but there are people on the margins who find it really difficult to cope with it.

“You can find yourself being punished, having money you need to live taken away.”