Ministers are under growing pressure to allow financially struggling local authorities in England to increase council tax by as much as 25% to prevent bankruptcies.

Under normal circumstances, councils must limit tax hikes to 4.99% or seek voter approval for higher increases.

However, some councils, including Hampshire, Bradford, and Windsor and Maidenhead, are requesting exceptions due to severe budget deficits, particularly from rising social care costs.

Hampshire is seeking a 14.99% increase, while Windsor and Maidenhead has proposed a 25% rise.

These councils argue that exceeding the cap is essential to avoid insolvency and to stabilize their finances.

Government ministers have yet to decide on any interventions but have indicated they could allow some councils to breach the cap.

The County Councils Network reports that 85% of councils are in a worse financial position than before the autumn budget, with many set to make deep cuts in services like social care and education.

Critics warn that raising the cap without addressing long-term funding issues may lead to further fiscal challenges for local governments.