South Tyneside Council is set to increase council tax by 3.95%.
The rise is 1.95% and an additional 2% levy to cover adult social care costs.
This means homes in lowest Band A will be paying an extra £34.67 a year to help the cash-strapped council balance its books.
There is positive news for council tenants with proposals for a 1% reduction in rents.
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In 2015/16 South Tyneside Council had a net revenue budget of £136million. For 2016/17 the net revenue budget is £131million.
Coun Ed Malcolm, lead member for resources and innovation at South Tyneside Council, said: “We’ve managed to balance the budget this year, but it has been our most difficult year to date and it will only get more difficult in years to come.
“We’ve had a 7% cut to local spending power and we need to save a further £14million. This is on top of the £126million we have had to save in recent years.
“This is all down to the Government, which has an obsession with cuts.
“It’s so that they can go into the next election and say they’ve reduced taxes. But it’s a false economy.
“To make these savings means a greater expense in the future to local authorities like ours.
“The Government says it is giving councils greater freedom, but all they’re doing is giving us the freedom to make harsh cuts.”
Instead of providing additions grants, the Government has permitted 2% of any increase in Council Tax bills to be ring-fenced to help meet rising adult social care costs.
The council is unable to increase council tax higher than 2% without holding a referendum.
Coun Malcolm said the increase is still not expected to fully cover the adult social care demands, as the borough’s population who are aged over 85 is set to double in the next 20 years.
Coun Malcolm said: “The reality is that, since 2010 we are £365 per household worse off in South Tyneside than the national average.
“As a council we now have 30% less to spend on helping the people of South Tyneside to realise their ambitions.”
Coun Malcolm also warned that there may be a noticeable difference in services as council bosses have to shed 600 posts over the next four years.
Coun Malcolm added: “An organisation which loses 30% of its funding can’t continue to operate the way in which it has been. We have still been providing services, perhaps changing the way some are delivered.
“We will have to think long and hard about which services we can and cannot continue to provide in the future.”
This year’s budget proposals will be put be put before council’s Cabinet on February 10 and the full council on February 25. What the 3.95% increase in Council Tax will mean for you.
• Band A will see a weekly increase of 67p, or £34.67 annually.
• Band B will see a weekly increase of 78p, or £40.45 annually.
• Band C will see a weekly increase of 89p, or £46.23 annually.
• Band D will see a weekly increase of £1, or £52.01 annually.
• Band E will see a weekly increase of £1.22, or £63.57 annually.
• Band F will see a weekly increase of £1.44, or a £75.13 annually.
• Band G will see a weekly increase of £1.67, or £86.68 annually.
• Band H will see a weekly increase of £2, or £104.02 annually.