Surrey Heath Borough Council will have “not much left” after draining another £2 million from its savings to balance its books – despite increasing its share of tax by 2.99 percent.

The rise will push Band D bills past the £2,500 barrier but huge interest repayments on legacy loans mean it still has to raid its dwindling piggy bank to produce a legal budget.

The budget and council tax rises were voted through unanimously, with councillors also agreeing to freeze their own remuneration packages.

Surrey Heath Borough Council voted to increase its share of your tax burden by an average of £7.66. When  added to the hikes by Surrey County Council and Surrey Police, Band D bills will go up by £114.73.

This is because the county council’s take of £1,938.42 accounts for 76 percent with the police’s 14 percent costing a further £352.57.

When added together Band D homeowners will find demands of £2,553.93 landing on their doorsteps.

Speaking to the February full council meeting was Cllr Leanne MacIntyre, portfolio holder for finance.

She said: “I simply do not believe that doing the right thing for our residents requires us to argue for the sake of performance, and in particular when it comes to the budget, where there are very few options available to set a balanced position. The benefit of arguing without progress is negligible.

“It is true that a significant portion of savings achieved since 2023 have been absorbed by increased interest rates, a consequence of the council’s exposure following historic town centre purchases, by inflation which is now baked into our costs that tool on a life of its own  much like the slowly decaying lettuce, and by the indirect impact of those same pressures on our major commercial contracts.”

She said the council has managed to cut £5 million in costs and services adding that it was a significant amount given the total budget of around £18 million.

The council will continue to charge for its discretionary services on the idea that those who use them should help cover their costs, while assets that no longer work for the council will continue to be offloaded.

Surrey Heath Borough Council’s rise works out as an additional £300,000. It comes as the Government changes how local government is financed with the total pool remaining the same but directed more towards areas less able to raise their own income.

Cllr MacIntyre said the council would collect £10.6 million in council tax, covering roughly 59 percent of the cost of services. A further £2 million would come from business rate retention, representing just 2.8 percent of the total collected by the authority.

She said £3 million would be spent servicing long-term debt, bringing the overall cost of services in the borough to £18 million, while the council was able to raise £16 million in income. The resulting £2 million shortfall would be met by drawing on reserves.

Cllr MacIntyre said this would leave £9 million in earmarked reserves that could not be used, alongside £7 million in general earmarked reserves and £500,000 remaining in the general fund, adding that this was “not much”.

“It is deeply regrettable that 60 percent of our residents’ money is going on interest payments for buildings that will never deliver the return they were promised, including one that is currently out of use, with limited benefit to residents,” she said.