North Yorkshire County Council looks set to increase council tax by 3.49%, which would increase its share of the bill to £1,411 for an average band D property in 2021/22.
The proposal, which has been recommended by council officers, includes a 1.99% increase in general council tax and a 1.5% increase in the adult social care precept.
County council bosses have also proposed to use £8.2 million from its own funds to offset a shortfall next year.
It comes as the council faces financial pressures due to coronavirus and loss of government funding.
The authority has estimated a shortfall of £59 million by 2023/24 and has already spent £82 million in responding to the pandemic.
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A report due before senior councillors next week written by Richard Flinton, chief executive, and Gary Fielding, corporate director for strategic resources, said the county council faces uncertainty in the coming year.
It said the council faces various risks, including a lack of funding beyond March 2021, a likely increase in demand for services, potential rising costs, a need for further savings and the potential reorganisation of local government in the county.
The report added that while continued use of reserves was not sustainable, it will be a “crucial component” for the upcoming budget in light of the coronavirus crisis and other uncertainties. It added:
“The council has performed well in responding to austerity and has taken earlier decisions in order to ensure that it is ahead of the curve and not pushed into short term decisions.
“A good level of reserves has been maintained and this will now be a crucial component of the budget strategy.
“Given the essential emphasis on responding to covid, recovering from covid, preparing for local government reorganisation and diminishing returns on savings programmes after a decade of austerity, there is much less scope for new and significant savings proposals.
“Reserves are therefore key to ensuring that a medium term approach to planning can take place.”
Cllr Carl Les, leader of the county council, said:
“We hope to be clearer later in the year about the legacy of covid, the government’s decision on local government reorganisation in North Yorkshire and the future of council funding beyond 2022.
“The times have never been so uncertain, and given these uncertainties it is critical that the council maintains as much flexibility as possible in order to protect vital services whilst being able to respond to further potential shocks.
“We understand that residents are facing many difficulties in the light of covid. We also understand just how vital some of the council’s services are to the most vulnerable in society.”
Senior councillors on the authority’s executive will decide whether to refer the budget plan to full council on January 26.
The final council tax bill will be based on sums demanded by Harrogate Borough Council and the North Yorkshire Police, Fire and Crime Commissioner as well as the county council.
The news comes as Harrogate Borough Council has proposed to increase its share of council tax by £5.
Julia Mulligan, North Yorkshire Police, Fire and Crime Commissioner, is expected to reveal the precepts for both the fire and police service at a later date.
