WEST Somerset Council is considering a council tax increase of 3.32 per cent for the next financial year. 

The council says it will be able to set a balanced budget in the coming year, despite substantial cuts in general funding support.

The council has received its provisional settlement from Government that sets out the share of grant funding and business rates income that will be due to West Somerset in the next financial year from April 2018.

The actual grant settlement – made up of revenue support grant, rural services delivery grant and new homes bonus grant – totals £738,000 next year. This is £296,000 or 29 per cent less than the current financial year.

A share of business rates income is kept by West Somerset under the “retention” system. The settlement has confirmed the baseline and tariff amounts included for West Somerset retention calculations which is £218,000 lower than previously forecast.

However, overall the retained business rates income is higher than in previous years, at £2,460,000. It is expected to drop down again in the following financial year to £1,850,000 as the 2018/19 figure includes a one-off adjustment due to the Revaluation in 2017.

While West Somerset Council’s medium term financial plan shows a reduced budget gap compared to the forecast in summer 2017, significant financial challenges and uncertainty remain in the medium and longer term.

The council says money needs to be set aside to cover the volatility of business rates income – and potential appeals - in respect of Hinkley Point. By increasing reserves to address the risk and protect services, the annual budget gap would increase by between £400,000 and £750,000 from 2019/20.

The council is considering an increase in council tax of 3.32 per cent - a rise of £5 a year for the average Band D property.

There is no increase in the amount paid to the Somerset Rivers Authority, which remains at £1.76 a year and is included in the overall amount charged.

This means the average council tax payer in the West Somerset would get all their district council services for £3.03 a week.

“Setting a balanced budget in the face of West Somerset’s well-documented serious financial challenges is a real achievement,” said Leader, Cllr Anthony Trollope-Bellew.

“We can do this in the year ahead – but further ahead this becomes increasingly difficult. There are no easy options left, and future projections for business rates funding and new homes bonus are uncertain beyond 2019.

“This is why we are proposing to create a single new, modern and fit-for-purpose council with our neighbours, Taunton Deane Borough Council. This will enable us to increase savings to at least £3.1m for the taxpayer and help us to protect valued services.”

West Somerset Council’s share of council tax is about 10% of the total with the remainder going to fund Somerset County Council, police and fire service. Town and Parish councils also take a share.

The budget proposals will be considered by the council’s scrutiny committee on January 18 and by the Cabinet on February 7.

The final budget will be set by full council on February 23.