COUNCIL tax will rise by almost two per cent in Lancashire from April, despite claims the county council is sitting on a £280m nest egg in the bank.
Furious Tory members failed in a bid to halt the increase, which will bring in around £7.5m extra to help soften “savage” government cuts in services.
Liberal Democrats joined forces with the ruling Labour group to push through the rise which will mean an additional £22 on the annual bill for an average Band D property - on top of any increase demanded by district councils.
But the move, just a week after it was revealed LCC had landed a £52m windfall from playing the financial markets, caused uproar in the council chamber at County Hall where opposition leader Coun Geoff Driver accused the authority of employing “the economics of the madhouse” to set its financial programme for the coming year and demanded a council tax freeze.
“There is no need to make such savage cuts at this time, even though we are facing serious financial difficulties,” stormed Coun Driver.
“Why not use the £52m sensibly and practically to at least delay the most sensitive cuts? That’s what the people of Lancashire would want.
“Why have we increased council tax when we are sitting on reserves of £280m?
“We are saying that the reserves we have are there for a metaphorical rainy day. Well, I would invite you to look out of that metaphorical window. It’s pouring down.”
Lancashire is having to make around £241m of Whitehall-imposed economies by 2018, of which £100m will fall in the coming financial year.
Labour deputy leader Coun David Borrow maintained the council had to put the “one-off” £52m cash bonus aside to protect against possible financial risks ahead.
“The scale of the cuts we need to make is truly staggering,” he said before the council voted 46-34 in favour of the budget and council tax rise.
“I remember Coun Driver when he was (Preston) chief executive and before that city treasurer. Like any council officer in the current situation, the last thing you would do is spend a one-off asset. You would be advising us to increase the council tax. We should guard against short-termism.”
Leader of the council, Jennifer Mein, accused Coun Driver and his party of being “in denial” over the financial situation the authority was in.
“We are meant to be carers of the public purse,” she said. “But you don’t even know what’s in that purse.
“We are working smarter, getting better value for money. The vulnerable people of Lancashire will not suffer as a result of these cuts that have been forced upon us.”
Lancashire’s total budget for the coming year is more than £720m. More than half of that - £375m - is to pay for social care.
A 1.99 per cent rise in council tax, for the second consecutive year, is the most the authority can impose without the need for consultation.
It means that householders with an average Band D property will pay £1,129.78 to the county council, up from £1,107.74 in 2014/15.
Coun Driver accused the Labour group of presenting a budget which had been prepared by officers.
“It is very difficult, in some cases impossible, to see what the impact of the cuts proposed will be on the people of Lancashire,” he said. “It is irresponsible. It is a bit like reading a book and then going to see the movie - it is very, very different.
“We have actually had a windfall of £52m which wasn’t budgeted for. The people of Lancashire will wonder why you have cut services to vulnerable people at a time when you have just received that windfall.
“These are the economics of the madhouse. You will make the financial situation much, much worse.
“There are lots of Labour council leaders in this room who have frozen council tax. And they haven’t had a windfall of £52m. If they can do it, why can’t you?”