A maximum allowed three per cent rise in South Holland District Council tax will go entirely to Internal Drainage Boards, the authority has said.
Its proposed budget and mid-term financial strategy also includes combined savings of nearly £12m starting with £1.4m in the next financial year and between £2.6 and £2.7m every year for the four years after that.
South Holland District Council says a three per cent council tax increase works out at just over £6 a year on average and will bring in £268,000 more than last year.
But it also says increases requested by drainage boards will cost it £279,000.
The district council has to give money to the internal drainage boards which have all asked for an increase of eight per cent apart from the Black Sluice board which is asking for a 20 per cent increase.
It received a one-off payment from central government to balance the books last year but is unlikely to receive one for the next financial year.
In total in the 2024/25 financial year, the district council will provide £3.4m to the boards, an increase of over £800,000 from 2021/22.
The authority states that last year its utility cost bills went up 150 per cent and fuel costs 50 per cent.
The report to the council’s Cabinet this week states: “In 2024/25 a budget is proposed that allows expenditure to be financed through the use of reserves in order to smooth the impact of the council’s ongoing pressure, significant savings are required going forward as a result of increased inflationary costs and other cost pressures, including substantial pressure from the IDB levy.
“This means that the council can continue to provide services whilst also supporting its overall objectives.”
Coun Paul Redgate, portfolio holder for finance, said: “The creation of next year’s budget has been extremely challenging.
“It has been set within a background of unprecedented inflationary pressures and significant changes in resident, customer and business needs.
“Despite these challenges the council’s financial position means that it is well placed and able to take a considered approach to mitigating these exceptional challenges.
“The government has provided a one-year settlement, however, the concerns remain significant and into the short and medium term.
“Despite the challenges of the past few years, we continue to work to develop new opportunities, efficiencies and income streams to support the council’s revenue budget.”
On drainage boards, Coun Redgate continued: “A significant element of the council’s budget is the Drainage Board Levy, like the council, the drainage boards are also experiencing increased cost demands.
“The council is liaising with the boards, who are attempting to limit future increases where possible.
“This is proving increasingly difficult with significant increases in power and fuel costs having being experienced.
“Representations to government have been made and continue to be made due to the substantial loss of income to the council.”
The budget does include £24.5m over the next two years for the refurbishment of the Castle Sports Complex which has been funded by the Levelling Up fund.
