Calls to withdraw millions of pounds from commercial and retail property outside Suffolk have been rejected, as budget plans were given the green light.
Mid Suffolk District Council approved its budget which featured a 2% increase on the district council element of the council tax bill – 6p per week – as well as plans to pump a further £25million into property investment.
The changes, approved on Thursday, February 21, will come into effect from the new financial year in April.
Babergh and Mid Suffolk councils established a joint investment firm CIFCO Capital Ltd to invest in commercial and retail buildings, which would generate income that could prevent cuts to services.
Each has invested £25m a piece to date, with both councils now approving a further £25m each in their latest budgets.
But the investments have proved controversial by including retail investment despite concerns over the high street market, and largely investing outside of Suffolk.
Councillor John Whitehead, Conservative cabinet member for finance said the council tax rise was “more with an eye to the future rather than immediately [needed].”
Commenting on the CIFCO investments, he said: “I am mindful that some genuine concerns have been expressed regarding this policy.
“This is a long term investment to provide a robust and diverse stream of revenue income to fund our core services for many years ahead.”
The opposition Green group had tabled an amendment calling for the CIFCO investments to be sold within the next four years and the money used on housebuilding, as it would deliver on more of the councils priorities.
Mr Whitehead described the proposal as “economic vandalism”.
Green group councillor Andrew Stringer said that £1 in every £3 from last year’s council tax remained unspent, questioning the need for another rise, and asked what would happen if the retail properties invested in had been among those to have collapsed.
He added: “We clearly have an opportunity to do something about that, and bring those two together where our residents are concerned.
“I think of investments like charity – they should begin at home.”
Penny Otton from the Liberal Democrat contingent said the tax rise would hit the poorest families the hardest.
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