A rebellion by Conservatives and some independents failed to halt approval of Redcar and Cleveland Council’s budget plans for the next financial year which include an overall 4.99% local tax rise.

A majority of council members – 37 – voted for the plans, with 16 voting against and one abstention.

The council previously said it was facing a £2.2m revenue budget shortfall, which would be largely funded from reserves, although an additional £1.5m provided by the Government had reduced this to £700,000.

Cabinet member for resources, Councillor Christopher Massey told a meeting he accepted council tax going up would be a “challenge” for many.

The rise will add £1.73 per week (£90.27 per year) to the bill of a full council taxpayer living in a Band D house, while someone living in a band A house receiving full council tax support will pay an extra 20p a week (£10.53 per year).

Rejecting criticism of council tax levels, Cllr Massey said the local authority had the third lowest rate of council tax in the North-East, while also describing various financial pressures it was facing.

He said: “Local Government has been chronically underfunded and that has remained so for the best part of a decade.”

Cllr Massey added: “I pray members pass the budget because we are in a difficult position financially, as are all our neighbours.”

Councillor Paul Salvin, leader of the Conservative group on the council, had called for the budget proposals to be rejected and attacked the Liberal Democrats for continuing to “prop up” the minority Labour administration.

He said round table discussions arranged when the budget was being developed had been a sham with no cost saving suggestions from the Tories being implemented.

Cllr Salvin said: “They [the discussions] were all in the name of a PR exercise so the council leader can say we have all worked together on the budget.”

The Conservative member described a “bin tax” in respect of a planned charge for green waste collections and also called on the council to “get a grip” of procurement costs.

He also said for every £1 of council tax being paid, 17% was going towards interest on loans taken out by the local authority.

Council leader, Labour’s Alec Brown said “difficult decisions” were required to “shield our residents from potential greater hardship”.

He said: “What we witnessed from the first speaker – the leader of the Conservative group – was ten minutes of populism and party politics before people.”

Cllr Brown mocked Cllr Salvin for a cost saving the latter said local Tories had been responsible for, which he likened to “Bob the Builder who does the lights in Eston for three grand”.

Lib Dem councillor Glyn Nightingale, Cllr Massey’s predecessor on the cabinet under the independent/Lib Dem administration which was voted out last May, said not to pass the budget would be effectively a vote of no confidence.

He said it was “absolutely essential” the council was provided with the resources it needed to do its job and called for a “rational decision”.

Independent Barry Hunt said he had struggled to sleep when considering the council’s financial position and recounted a bizarre dream in which Cllr Brown had popped out of a bin – to laughs from the rest of the chamber.

Cllr Hunt described a visit to a community centre in his Brotton ward and said residents were paying more for less.

Stating he would vote against the budget, he said: “I cannot look these people in the eye otherwise.”

Labour councillor Bill Suthers, who has the children and families brief on the cabinet, said: “Nobody agrees with putting council tax up or reducing services, but if you are not in favour what’s your alternative?”

Independent councillor Steve Kay said failure to agree on a budget – councils being legally required to set balanced budgets ahead of the next financial year ensuring expenditure does not outstrip income – would lead to far worse implications.

Agreeing the proposals for 2024/25 would be the “best of a bad job in very difficult circumstances”, he said.

But another independent, Loftus ward councillor Tim Gray said it was with “much regret and soul searching” he could not lend his support.

The council plans to make savings totalling £8.6m over the next five years – the period of its medium financial plan – although most are “front loaded” into 2024/25.

A review of library provision is being undertaken, along with youth and community centres and a means test introduced for discretionary adult social services currently provided free of charge, while funding for stop smoking services could also be withdrawn.

The council also expects to raise £960,000 in 2024/25 from increases to fees and charges first set out last year.

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This includes the new chargeable green waste collection service being introduced from April with residents being encouraged to opt-in, paying a charge of £40 for one garden waste bin to be collected fortnightly between April and November and £20 each for an additional bin up to a maximum of five.

It is proposed to invest almost £39.5m in services over the next five years, including children in care, children with disabilities, adult social care, home to school transport, waste, roads and environmental services. 

A £177m capital investment programme is also planned including replacing old vehicles, building maintenance, roads, schools, disabled adaptations for homes, local children’s care placements, a new swimming baths at Eston and town regeneration with funds including levelling up money.