Council tax in the Vale of Glamorgan will increase by 3.9 per cent from next month.

The Vale of Glamorgan council set its budget for the next financial year during a council meeting on Wednesday, March 10.

The budget includes millions of pounds planned to be invested in many areas, including in upgrading schools and fixing potholes.

But opposition councillors urged for a smaller council tax increase, with the Tories calling for an increase of 0.8 per cent and Plaid Cymru calling for 2.65 per cent.

The council tax hike of 3.9 per cent means the annual charge for a Band D property will now be £1,357.02.

During the budget-setting meeting, councillors debated whether some of the more than £10 million reserves the council has should be used to cover the increased costs it must pay, rather than increasing council tax by such a high rate.

Councillor Vincent Bailey, leader of the Tory group, said transferring £2.7 million from the fund to the main budget would allow council tax to only rise by 0.8 per cent, just below the rate of inflation.

He said: "While there are glimmers of optimism, the reality of the economic crisis is such that families up and down the county are now extremely concerned about the impact of increasing their bills.

"These are exceptional, unprecedented financial circumstances. As such the Conservative group is calling for a one-off freeze, in line with inflation.

"The council currently holds reserves of more than £10 million. Freezing council tax at 0.8 per cent would cost approximately £2.7 million, taking reserves to a prudent but not excessive level of around £7.4 million.

"The Vale council this year has received an additional £7.1 million in funding from the Welsh Government this year: money that we believe should be used to protect hard-pressed residents from an increase in council tax at this time of huge worry."

The impact on hard-pressed residents of the above-inflation increase was also criticised by Cllr Bob Penrose, of the Independent group.

He said: "A large percentage of residents in my ward are of an older age group, with a fixed source of income coming from pension schemes, at best with adjustment for inflation.

"These residents—together with others who have been furloughed, working on reduced hours, or made redundant as a result of the Covid-19 pandemic—will be affected adversely by this proposed draconian increase.

"I appreciate the pandemic has caused additional cost to this authority, but I do not consider it to be right to try to cover more than an inflationary increase from residents of the Vale of Glamorgan."

Plaid Cymru recommended an increase of 2.65 per cent, calling the 3.9 per cent rise "unfair".

Cllr Ian Johnson, leader of the Plaid group, said: "The Vale council budget normally includes around £1 million from reserves to smooth over any problems with overspending or collecting council tax.

"This year, it didn't. Without good reason, Labour has instead forced residents to pay £1 million extra, which will also be included in next year's budget and every year from now on. Plaid Cymru believes this is unfair. If there are unexpected extra costs because of the pandemic, the council and government should pay for them, not the public.

"We think this is a cynical move to increase the amount that people pay in council tax this year, before finding extra money and announcing a much smaller headline increase before next year's local elections."

However, Labour and Llantwit First Independent councillors warned that if council tax doesn't rise this year, increases in future years could be even more severe.

Cllr Gwyn John, of the Llantwit First Independents, said; "There are a lot of people struggling and there's no doubt about that. But at the same time, if we don't pass this budget, we will then face possibly double money next year.

"We could have a situation where 3.9 could end up with our cost pressures for the year after with a budget next year of somewhere around seven per cent.

"I'm not prepared to accept that and I don't want to take the chance. I don't know what we're going to face this year in the future."

Cllr Mark Wilson, Labour, said: "We don't know what's around the corner. Last week they discovered eight new variants of Covid in this country; a couple of them are quite serious. We could be living with this virus for some considerable time. We need to be cautious."

Council leader Neil Moore said: "The reserves are a way of setting aside funds, they're not inexhaustible, and they have taken years of financial management to accrue. The council fund will be £10 million at the end of the next financial year.

"If you take £2.7 million out of the general fund, you are sincerely going against the recommendations of the Section 151 officer [the council's head of finance]."

Deputy leader Lis Burnett said: "I'm so disappointed at the tone of the debate today after the year that has been faced by the community, and the struggle that our officers have had to maintain services.

"In the year that we've had, I don't want to take any risks whatsoever that we can't continue to support our children, that we can't continue to support the most vulnerable in our communities."