TEIGNBRIDGE Council is planning an austerity budget for next year with the Council Tax predicted to rise 3.9 per cent, putting an extra £5 a year on to band D bills.
Car parking charges will be frozen, along with charges for many other council services, including leisure.
But the council still intends to press ahead with its priorities of economic development and housing. New employment units at Collett Way, Newton Abbot, will go ahead and £296,000 will be allocated to assist affordable housing, expected to help create up to 59 new affordable homes.
Along with councils up and down the country, Teignbridge Council has been badly hit by the economic downturn. The money it makes through investments has plummeted and next year it expects to make only half the £480,000 budgeted for this year. It could be worse – the council is thanking its lucky stars it did not, like others, put its money into Icelandic funds.
Other council income has been affected, particularly car parks and with the downturn in the housing market fewer people need land searches or are putting in planning applications. One bright spot is the concessionary fares scheme, expected to cost the council dear, but which has in fact come in roughly at the £1.17m allocated by central government.
After rigourously cutting costs, the council is confident it will be able to balance the books this year, while protecting reserves.
Next year, central government has made it clear that it intends to use its capping powers if council tax rises exceed five per cent.
The final figure for Teignbridge residents will, to a large extent, depend on what budget Devon County Council sets. Teignbridge Council is responsible for collecting the tax but only keeps ten per cent, the vast bulk – 73 per cent – going to the county council with the remainder being divided between the police, the fire service and parish and town councils.
The grant government gives the council is expected to increase next year by only 1.7 per cent, well below inflation. So that a council tax rise of 3.9 per cent for 2009/2010 will translate into a budget increase of only 2.4 per cent, giving a budget of £16.9m.
This assumes pay increases being pegged to 2.5 per cent and includes a war chest of £275,000 to fight planning appeals and rewrite the Local Development Framework.
Reserves, to cope with uneven flows of income and unexpected contingencies, will be set at slightly above five per cent recommended of budget at £1.15m
The council executive will be debating the draft budget on Monday, then it will go out to consultation before being finally decided on February 23.