Preston residents appear set for a rise to their tax bills as cash-strapped city council bosses take up a government offer for a rate hike.
Ministers last month said the cap before triggering a local referendum could be increased this year by one per cent.
According to a report set to be discussed by the ruling cabinet next week, the city council will therefore impose a 2.99 per cent increase.
It will mean a Band D property will pay almost £9 per year more, generating around £110k for the town hall.
In the report, council leader Coun Peter Rankin states: “Our capacity to deliver services in many areas is now very stretched and in some areas this means we cannot offer the highest standard of service possible.”
As part of a four year cabinet savings plan, a target of £1.5m worth of cutbacks has been identified for the end of 2018/19.
The council says a majority of these savings has already been found through measures such as offloading the running of two leisure centres to an external organisation.
The local authority will receive £700k from central government for 2018/19, down from £7.3m five years ago, in addition to the £5.3m it receives in business rates.
The report adds that although the council has a policy to avoid compulsory redundancy it "may be unavoidable”.
The financial plan will be discussed by cabinet next week and will then require full council approval next month.
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Coun Rankin adds: "We can no longer provide comprehensive community services which provide a vital lifeline to the most vulnerable individuals and families in Preston.
"Moving forward our ability to make investment in our streets, parks and open spaces is at risk.
“More difficult decisions lie ahead but we will continue to press on with our priorities.