Lewisham Council has agreed to increase council tax by 3.99 per cent

The hike was agreed at a meeting on Wednesday (February 24) as councillors set the budget for the coming year.

The steep rise is partly due to a 2 per cent levy on councils towards funding adult social care.

This means bills are set to rise by 1.72 per cent overall for a Band D property.

This works out to 45p a week, or £1,378.66 for 2016/17, up from £1,355.35 this year.

In setting the budget the council identified savings of £15 million which need to be found annually over the next three years, equating to £45 million in total from 2017/18 up until 2019/20.

MORE TOP STORIES The rise in council tax is only the second in seven years, as councillors defended the move amidst a reduction in funding from central government, falling from £160 million to £147 million this year.

The government has also scrapped the Council Tax Freeze grant, worth £1 million, which contributed towards setting the new rate.

Mayor of Lewisham Sir Steve Bullock said: “No one wants to pay more tax, but people also want local services.

“While the increase in council tax won’t prevent the need to make yet more savings from our budget, what it will do is help us plan our changes so that they impact less severely on the services that the community needs and values.”

Mayor of Lewisham Sir Steve Bullock

The council stressed it urgently needed the funds to continue providing much needed front-line services.

Fellow Labour Councillor Alan Hall, chair of the overview and scrutiny committee, said: "It is a fact that the Tory Government are reducing the amount of money available to councils forcing them to increase local taxes whilst reducing the level of service.

“I believe in these circumstances it is right to use our reserves and increase revenue to protect vital local services."

The council is using reserves of £5.94 million to plug a shortfall in the budget for next year, 2016/17.

To view the council documents visit: lewisham.gov.uk/Budget