Councillors in St Helens “reluctantly” voted through a 3.99 per cent council tax last night.
Council leader Barrie Grunewald told the council chamber presenting the budget to St Helens’ full council “gives me no pleasure”.
However, he said the increase was vital to protect council services in the face of government cuts.
The increase includes a 1.99 per cent rise accompanied by a two per cent rise to support social care.
Councillors across the political spectrum voted unanimously in favour of the budget.
Councils with social care responsibilities – including St Helens - have been asked by the Government to raise council tax more than the two per cent threshold that normally requires a local referendum.
The maximum is just below four per cent – with the condition that the extra funds are used for care provision.
The basic increase also takes account of further cuts in Government grants. For 2016-17 this equates to £9m – and takes the total lost since 2010-11 to £74m.
Council leader Barrie Grunewald: “It gives me no pleasure to present this budget but we will have lost 60 per cent of the grant that we used to be able to count on from central government and, at the same time, we face additional spending pressures.
“The Government claims that it is providing greater clarity with this grant settlement – but as far as we’re concerned all it does is confirm our worst fears. Once again we’re seeing deprived areas like St Helens come off far worse.
“If that wasn’t enough, we’re also facing other, significant financial pressures. The removal of opted-out status for pensions means that our National Insurance costs will rise by 3.4 per cent.”
Since the start of the government’s austerity programme, the local authority has taken countless measures to cut costs and drive up revenue.
Last year it beat its target by getting 632 new homes built in the borough - generating more council tax income.
There has also been more tax revenue from a higher level of commercial activity in St Helens.
Major efficiency savings have also been made. The council has changed the way it delivers and purchases services - and maximised value for money at every opportunity. The council workforce is also significantly smaller than it used to be.
Coun Grunewald added: “This situation is unlikely to change. So we’ve already started work on a major policy review of our spending priorities that will help us to deal with the challenges we’ll face beyond 2017.
“However these challenges are significant. As well as cost pressures in the care sector they include general inflation, increases in the number of adults and children needing support and rising levels of need, increases in demand for everyday services as the population grows and pressure on homelessness budgets.”