COUNCIL tax will rise by 3.99 per cent and £18.5 million savings will have to be found in the next financial year, council bosses have revealed.

Shropshire Council said it is facing tough financial times and branded the government’s funding model as “unfair” ahead of the proposed increase being presented to cabinet next week.

The council’s director of finance, James Walton, said the financial situation was tough, but hailed the positive impact of buying Shrewsbury’s shopping centres, which have raked in £2.4 million in this financial year, which will be used to protect services.

He said the increase consisted of a general 2.99 per cent rise and an additional one per cent on top to be set aside purely for adult social care, which is costing the council £8 million more each year.

He said: “We will be able to say what exactly that means in real terms to a Band D house shortly, but are just finalising the report.

“But the proposal is a 3.99 per cent rise which will go to cabinet next week and full council on February 28 to be passed.

“These are challenging financial times. Adult social care costs are rising by £8 million each year and children’s services are rising steeply as well.

“There will be £18.5 million of cuts to be found during the next financial year and we will also be looking at using £5-6 million of reserves to balance the books.

“You can’t keep using reserves as a long term solution so we have already put £25 million aside to help us manage the budget over the next two years.

“This is because we set the figure we receive from government four years ago and this year will be the last time we know for certain what we are going to receive from this central funding.

“After that we don’t know. The next financial year after this one we just don’t know what we are getting from the government.

“It could be that we get a bigger slice of the funding cake, but it may be that we get less.

“That is why I have had to be prudent and set this money aside so we are not in a disaster situation this time next year. It really is quite an unfair funding model.”

He said the council would not receive an idea on what funding it would receive for 2020/21 until autumn at the earliest.

Mr Walton also explained the difference between capital and revenue budgets.

He said: “You sometimes hear complaints that the council has bought the shopping centres and asked why was this money not spent on protecting services.

“But this is capital funding. It is illegal to spend it on services. It is for capital projects.

“However, we can spend the money generated from these projects on services, hence why we are delighted the shopping centres have generated us £2.4 million this year which can then be spent on services.

“This was a pleasing return but we know it may not always be that much as these are tough times for retail.”