'Tax hike could be even lower'

The rise was unveiled at a meeting yesterday and bettered finance chief Tony Martin's promise of a 4.5 per cent increase.

Coun Martin said his third budget would deliver a programme of £132million improvements to roads, schools and children's homes.

District council rises and police and fire authority increases in East Lancashire boroughs outside Blackburn and Darwen will be added to the 3.5 per cent increase before final council tax bills are set.

Coun Martin told the meeting: "I believe 3.5 per cent is a moderate and affordable rise for the community of Lancashire and shows how priority-led budgeting has worked for Lancashire.

"This increase is lower than that planned by all other county councils, including those which received a much higher grant settlement than Lancashire and I fully expect it to be the lowest county council increase across the political spectrum."

But Michael Welsh, Conservative leader at County Hall, said his alternative proposals would mean a rise below two per cent. Coun Welsh said his party would cut 72 vacant council posts from a total of 212 which taxpayers still have to fund.

As well as trimming the number of empty posts within the budget, Coun Welsh said £11.5million from the county's economic development unit could pay for an increase in the amount being spent on electronic government.

Coun Welsh added: "The county council seems to have a need to build up pots of money. The tax payer is already under a very great load. I think our budget would be prudent, sensible and demonstrate a practical will to control expenditure."

David Whipp, Liberal Democrat leader, said scrapping the staff canteen and the county council's hospitality budget could save taxpayers over £500,000.

Blackburn with Darwen Council said it was in line to deliver a rise close to inflation when its council tax is set in March.