Councillors have successfully approved the first budget of Somerset's new unitary authority, including a significant rise in council tax bills.

The ruling Liberal Democrats – who were swept to power in the local elections nearly a year ago – put forward proposals in early-February which would see council tax bills rise by nearly five per cent in a bid to plug a £38m budget gap.

The budget also includes significant investment in children's and adult services, as well as more than £250m of infrastructure improvements across the county.

Councillors voted to approve the budget when the full council met at the Canalside in Bridgwater on Wednesday morning (February 22), with most of the Conservative opposition abstaining from the final vote.

The new unitary authority officially comes into being on April 1, replacing Somerset County Council and the four district councils.

Deputy leader Liz Leyshon introduced the budget, stating: "This is a budget that has been carefully considered but does not forget about ambition. We have dealt with inflation at the highest level for 40 years – and the budget builds in our estimates for that.

"We have worked to protect front-line services with a view to implementing the unitary business case.

"We are using £10m of earmarked reserves to smooth out the differences over the next two years and £4m of flexible use of capital receipts for the unitary implementation costs."

Every local authority in England sets two different budgets – its capital budget (which covers the creation of new buildings, roads and other facilities) and its revenue budget (which covers day-to-day spending on services, including rent and salaries).

Somerset Council's capital programme amounts to more than £258m over the next 12 months, and includes the regeneration of Bridgwater and Glastonbury town centres through their respective town deal, the upgrading of the Octagon Theatre in Yeovil, delivering new cycling infrastructure on the Firepool site in Taunton and resurfacing the 'concrete carriageway' linking Wellington to the M5.

The revenue budget is being partially funded through a 4.99 per cent rise in council tax (the highest amount possible without holding a referendum), of which two per cent will go directly towards funding adult social care.

For the average Somerset taxpayer (known as Band D), their council tax bill will rise to £1,646.04 per year – or £135.95 per month.

This comprises £1,434.93 of general council tax (a rise of £46.88), £196.46 for adult social care (a rise of £31.36), and £14.65 to fund the Somerset Rivers Authority.

While this seems high, it is still far below the rate of inflation – and thanks to a council tax support scheme agreed in November 2022, many low-income households across Somerset may not have to pay any council tax at all.

Ms Leyshon said: "The council tax increases we are proposing is in line with government policy, and the increase is half the current rate of inflation. We understand the pressures on local residents, and we have put forward mitigations wherever possible.

"We need the government to give greater consideration to the future financial health of local authorities, particularly those with social care responsibilities.

"Simply delaying social care reforms isn't good enough, and there is a clear risk of upper-tier [county] councils failing due to rising demand and inflation."

Councillor David Fothergill, who leads the Conservative opposition group – and was council leader until May 2022 – said he and his party could not support the budget due to the amount of reserves being drawn upon to balance the books.

He said: "I won't be voting for this, because I and my party don't believe this is a balanced budget. The use of £19.9m of reserves to balance the budget – you can't keep doing that. You have to build reserves.

"The monitoring officer says that failure to make tough reserves will lead to reserves being exhausted. If you keep pulling on reserves, you are going to go bankrupt."

"Within three months, you will not be achieving this budget – you will be overspending it."

Councillor Mike Rigby, portfolio holder for transport and digital, responded: "I'm astonished at the leader of the opposition. Where is his alternative budget?

"The closest this council has come to a Section 114 notice was when he was leader of the council – we haven't forgotten their panic."

After more than two hours' debate, the full council voted to approve the budget by 64 votes to one, with 33 abstentions.

While Labour's councillors voted in support of the ruling Lib Dems' budget, the vast majority of Tory councillors abstained.

Speaking after the vote, Mr Revans said: "It is disappointing that the Conservatives chose to play political games today rather than standing up for Somerset's residents.

"Despite not supporting the budget, they failed to provide any alternative plans. After all, it is the actions of their government that mean we are continuing to reap the legacy cuts to preventative services, leading to a surge in demand for key services.

"The failure of the Tories in Westminster to provide sufficient funding and resources for local councils has left us short-changed in Somerset and their legacy is a difficult financial situation.

"While this budget does include an increase in council tax, the level proposed is half that of inflation and we have put in place a robust council tax reduction scheme and an exceptional hardship fund for those residents who are continuing to struggle through the cost of living crisis.

"When we were given the responsibility of delivering the new council by Somerset's residents, we committed to putting the heart back into Somerset and to be a council that listens. Since becoming the administration, that's what we've done."

"Despite the difficult economic circumstances, we have been able to commit ourselves to maintaining vital services and delivering important capital projects across the county.

"From the Octagon in Yeovil to Firepool in Taunton and supporting the town deals for Glastonbury and Bridgwater, we are an administration for the whole of Somerset.

"The next few years will continue to be challenging but I am confident that we are building a council that is fit for purpose – a council that doesn't rely on grand statements and rhetoric but instead on hard work, careful consideration, and responding to the needs of the people we are here to serve."