COLCHESTER Council looks set to increase council tax by 1.95 per cent – £3.42 for the average household.
However, councillors are hedging their bets and have also proposed a council tax freeze.
The Government is considering reducing the maximum increase allowed without a council holding a referendum to approve it.
The current limit is 2 per cent, but Colchester Council fears local government minister Eric Pickles could reduce the threshold to 1.5 per cent.
A council tax freeze, which would entitle the authority to a Government grant equal to a 1 per cent rise, would still leave a funding gap of £89,000.
Paul Smith, councillor for business and resources, said: “If we went for the freeze option there are various ways we could fund the gap.
“There will be a relatively small amount which we could fund from reserves or fund by making minor changes to the capital programme.
“Having a referendum is not really an option, because it would not take place until May, so what would we do in the meantime?
“If voters say no then we face making a year’s worth of savings in just nine months. We don’t want to put people through that.
“It would be foolish to gamble.
We want to be in full possession of the facts before making a decision.”
A spokesman for the Department for Communities and Local Government said an announcement on the referendum limit was due shortly. The council’s cabinet will discuss the budget plans on Wednesday, January 29, before it is debated and voted on by the full council on Wednesday, February 19.
Mr Smith said: “We are facing a 30 per cent reduction in our Government grant this year and we have been able to accommodate most of that, but not by cutting frontline services.
“Other councils have announced huge job losses.
“We’ve made efficiency savings in a huge number of areas, but the scope for doing that is becoming less and less, and the council is having to cut more things we don’t have to do.”
! Essex Fire Authority is facing a similar dilemma on council tax and has two alternatives – either a freeze or a 1.9 per cent increase in its share of the overall bill.
The Essex Police and Crime Panel meets on Wednesday, January 29, to debate its budget for next year, and no proposals have yet been made public.
£160k to tidy up roads
LITTER-PICKING on the A12 and A120, costing £160,000, has been included in the council’s budget plans.
Street wardens will carry out fortnightly clean-ups and empty lay-by bins.
Mr Smith said: “The Highways Agency always provided a grant to do this, but it turns out it was under no legal obligation to do so and stopped it.
“Likewise, the county council has no obligation, so it is down to us.
“Either we allow the litter to accumulate or we pay to clear it so we took the decision we can’t allow the approaches to Colchester to look an absolute disgrace.”
£100k a year to pay off U's stadium debt
COLCHESTER Council is setting aside £100,000 towards repaying cash borrowed to build the Weston Homes Community Stadium.
It is set to become an annual payment.
It had hoped to recoup more money from housing developments in north Colchester, the sale of the Layer Road ground, and money from ticket sales at Colchester United.
While attendances are marginally up, they are not as high as hoped. Building along the Northern Approach Road has faced delays and the Layer Road stadium sold for less than expected.
Mr Smith said: “The Government says if the council borrows money we have to make an allowance towards repaying it so we do not rack up a huge debt.
“The developments in north Colchester will generate revenue to repay the debt, but we have put some money aside to cover the cost, because the development is not coming as quickly as originally intended.”