STROUD District Council has approved a 1.9 per cent tax rise for its services in the next financial year – expected to be the lowest hike of any major local authority in Gloucestershire.

The below-inflation increase, which compares to last year’s 3.5 per cent, means the annual district levy for a band D household will rise by £3.49 to £186.93.

SDC plans to maintain services in the recession through savings and other measures, including reducing staff costs, cutting grants and increasing car parking charges.

Speaking during a full council meeting at Ebley Mill on Thursday, leader Frances Roden said: "We have to balance our budget needs with the tax demand on hard-pressed council taxpayers.

"We are managing to invest in what the district needs while still keeping the council tax increase to less than two per cent."

The tax rise will fund work on homelessness prevention, household energy efficiency and climate change.

Existing funds and savings will pay for the continuation of an officer for young people and also set up a joint financial system with seven other councils to save money.

SDC has continued to face increased expenditure in benefits, housing advice, council housing and pensions.

The authority also expects reduced income from the Government, land charges, planning applications, recycling materials and deposits.

Senior officers have identified possible efficiency and budget savings of £720,600 each financial year until April 2014.

SDC could also shave off a further £170,000 over three years by handing back three sports facilities to their owners, including Nailsworth Recreation Centre.

However, some councillors suggested the authority should consider other ideas such as borrowing money while interests rates are low, using the council's cash reserves or spending money on projects now which would produce savings in the long term.

In response, Nigel Cooper, cabinet member for finance, said: "I am not totally adverse to taking on debt but just at the moment we are in a very uncertain time economically."

He said SDC could end up in a lot of debt if councillors took the option to take control of the financing of council housing from the Government, which is being discussed at present.

Councillors voted 25 in favour of the tax rise and 10 against, with six abstaining.

Future grant funding for Stroud Valleys Artspace and the Prema arts centre in Uley is expected to be re-instated on Friday.

SDC originally planned a phased reduction in support from this April but officers now hope to maintain the current levels after councillors voted to keep the overall grants budget at the same level.