Waltham Forest Council has approved the maximum possible hike in council tax in the midst of increased demand on services during the pandemic and uncertainty over government funding.

At a full council meeting March 3, councillors voted to increase council tax by 1.99 per cent and the adult social care precept by 1 per cent - a decision leader Grace Williams said was "not taken lightly".

Council tax bills for residents in band D properties are set to increase by a total of £76.77 per year after taking into account an 8.8 per cent increase in the Greater London Authority’s portion of council tax.

Increases to council housing rents were also approved, with the 4.1 per cent rise linked to the level of inflation in September last year.

Cllr Williams said the decision to increase council tax was the same as the "overwhelming majority" of local authorities across the country and means there will be "no budget reductions" in the next financial year.

The Labour politician added: "To ask for a small increase is not what any of us want, but we must take that decision because we know the greatest responsibility is to provide for those in need.

"We take these responsibilities very seriously, we know this budget and the decision will have far reaching consequences, not only for people who turn to us but for everyone who calls the borough home.

"We do not take this decision lightly, but given the financial uncertainty we will raise council tax by 1.99 per cent, in line with inflation, and will add the 1% in line with needs for social care, complex mental health needs and care homes."

Cllr Williams added that the overall 4.12 per cent increase equates to £1.31 a week more.

The council’s overall predicted spending budget will rise by £15 million to £444 million next year, with £276 million coming from the Government. The council tax increase is expected to raise an extra £5 million.

Cllr Williams also took aim at Boris Johnson’s "irresponsible" government, which she said has "no plan" to truly level up the country in the face of rising inequality.

According to the budget report prepared by director of finance and governance John Turnbull, the council faces "significant financial challenges" given the "unprecedented" drop in government funding since 2010 and the loss of other income streams.

Future risks to the council’s books include uncertainty in future government funding to councils, economic instability due to Brexit, changes in how business rate income is shared and demand on services from population growth.

Those risks are in addition to recent costs Covid-19 has placed on the council, which has taken on extra costs of caring for elderly people leaving hospital, increased need for social services and providing testing and vaccination services.

The council’s overall reserves will fall from £126m in March 2021 to £93 million this month, levels the finance director says are "appropriate".

The Conservative group in Waltham Forest proposed not raising council tax by cutting the council’s communications budget, members’ allowances and using more reserves, but this amendment to the budget was rejected by the council’s Labour majority.

Conservative group leader Tim James said Labour was adding to the "cost of living crisis" but Cllr Williams said the Conservatives’ suggestions were "out of touch" with residents.