Household bills and parking charges in the Cotswolds are set to rise from April as the District Council approves a 3.3 per cent tax hike in a bid to avert bankruptcy in years to come.

Cotswold District Council leaders say they are not in imminent danger of issuing a section 114 notice which would effectively declare them bankrupt.

But finance chiefs warn they are facing a “financial cliff edge” in years to come.

Councillors voted last night (February 21) to approve the budget for the upcoming financial year which means people living in a band D property will see the annual proportion of council tax which funds district council services rise by £5 to £153.93.

The final total council tax bill will be much higher as it will include the charges of Gloucestershire County Council, the police, and, where relevant, the parish council.

Cotswold District Council is in a good financial position but finance chiefs say they they face a cumulative budget gap of around £4.2m which would reduce their financial resilience reserve to nil by 2027/28.

To tackle this, the council has a savings and transformation plan which should close the gap by around £2m this coming financial year.

They are looking to make savings of around £1.2m and generate around £770,000 extra revenue by rising parking charges by around 15 per cent, garden waste fees and introducing Sunday charging for car parks.

Finance cabinet member Mike Evemy (LD, Siddington and Cerney Rural) spoke of the funding challenges several authorities face across the UK at last night’s council meeting.

He said many are on the verge of declaring themselves bankrupt but thanks to the decisions taken by the Liberal Democrat administration in Cirencester they are not in imminent danger.

However, he explained the authority is facing a “financial cliff edge” in 2026/27.

“The budget papers today show a forecast gap in the medium term that we need to close to maintain our financial security and stability,” he said.

“Next year we will save £370,000 by changing waste collection rounds, half a million pounds in the full year.

“We will also save a total of £125,000 by making permanent reorganisation of our call centre.”

He said they would make savings of £1.25m and over £750,000 in extra income from fees and charges making a total contribution of £2m towards balancing the budget.

Cllr Evemy said the council is facing expenditure and income pressures of more than £500,000 and they need to find £1,1m just to cover contract, pay and energy inflation.

“In total that adds up to one and three quarter million pounds than we budgeted for in the current year,” he said.

“This budget will deliver a surplus next year of over half a million pounds.

“That together with a forecast surplus of over £300,000 in the following year will replenish nearly all of the reserves that will be needed to fund this year’s budget.”

The Conservative opposition proposed a budget amendment to scrap the proposed introduction of Sunday charges at the district’s car parks.

Group leader Tom Stowe (C, Campden and Vale) said the charges will be a “major blow” to already struggling Cotswold traders.

“These businesses which add so much to the vibrancy and diversity of our market towns rely on residents and visitors travelling to our town centres and parking,” he said.

“Increasing parking fees sends out a hugely negative message of the council’s attitude towards local businesses.

“It will inevitably have an impact on the number of people visiting, causing great damage to the local economy and risking our market towns becoming ghost towns.”

But council leader Joe Harris (LD, St Michael’s) explained the authority is facing a huge financial challenge.

“If we want to avoid a bankruptcy further down the line, a section 114 notice, then we have to take tough decisions because the Conservative Government don’t fund local government properly.”

While deputy Tory group leader David Fowles (C, Coln Valley) said there are shops suffering across the district.

“It’s tough times out there,” he said. “It’s about doing the right thing for the people of the Cotswolds and Sunday trading.”

The amendment was rejected by 23 votes to eight and the budget was subsequently approved by the same difference.