INVERCLYDE Council will not cut services further or impose its own council tax rise this year, despite a grant cut by the Scottish Government.

The SNP government has previously announced it is putting up the council tax for bands E to H.

That left the council to decide if it wanted to add a three per cent hike on all the council tax bands.

But this was rejected yesterday by a cross-party councillors’ budget working group, which agreed on a package of budget proposals that will be recommended to the full council on February 16.

The group represents 14 of Inverclyde’s 20 councillors, so will have a clear majority at next week’s full council meeting.

The other six, from the SNP, were withdrawn from the group in December by their leader, Councillor Chris McEleny.

Yesterday’s deal takes the heat off for this year, but Labour council leader, Cllr Stephen McCabe, today warned of difficult times ahead.

He said: “Despite a reduction in the council’s grant of nearly £5 million from the Scottish Government, the cross-party group has honoured the commitment given previously to balance the 2017/18 budget without further service reductions over and above those previously agreed as part of the 2016/18 two-year budget set in March 2016. This will be achieved through the use of reserves.”

He added: “The cross-party group had considered closing some of the budget gap with a three per cent council tax rise for all council taxpayers, as recommended by the Scottish Government.

“However, on balance, members of the group decided against this.

“They are conscious that 7,000 households in Inverclyde already face potential rises of between 7.5 per cent and 22.5 per cent, and did not wish to add to the burden on these families.”

But he said members of the group recognise that, if the Scottish Government continues to cut the council’s funding year on year, a rise in the basic level of council tax is inevitable next year – and every year thereafter.

Cllr McCabe added: “The council’s chief financial officer, Alan Puckrin, is estimating that the potential funding gap in 2018/19 is of the order of £10.5m, assuming a further £4.7m cut in Scottish Government funding.

“A savings target of this magnitude will be hugely challenging for the new council elected in May, and will require a fundamental review of the services the council delivers.”