Householders in one borough already know their council tax will increase by the maximum level possible next year.

Usually budgets are set in January after authorities hear from the government in December what their financial allocations will be, but Maidstone Borough Council has started the whole process early this year.

Last week, members of the corporate services policy and advisory committee were asked to approve the principles the borough would take in setting its medium-term financial strategy.

Those principles were that it would increase council tax by the maximum permitted level allowed by the government without resorting to holding a public referendum. Currently that is 3%, but it could be increased next year, seeing as how inflation is still running at 8.7%.

The second principle was that the council would put up fees and charges by 5% overall. Some fees might go up by less than 5%, but others would then need to go up by more than 5% to retain the average.

Cllr Simon Webb (Con) was the only dissenting voice.

He said: “As councillors we have got to be conscious of our residents. We all know that recently the mortgage rate has risen significantly which on average is taking an extra £500 a month out of people’s income.”

“I will need to be 100% convinced that a full 3% rise is necessary before I agree to it.”

His comment followed a presentation by cabinet member Cllr John Perry (Con) who said: “We are living in times of financial uncertainty, but we have a tradition in this council that we have a strong balance sheet and that our finances are in good order.”

He explained that given the uncertainty around future inflation and government funding levels, the council had modeled its future balance sheets for four scenarios, and then chosen to follow the fourth “worst case” scenario as being the most prudent approach.

It suggested that even given the approach to council tax and fee increases outlined above, it would still have to make around £1m in savings next year to balance its books.

Cllr Webb said: “What I don’t want to see are projections going forward which are inflated – inflated to give us a worse position than we will actually get to at the end of the financial year.”

His warning came after it was revealed that in the last financial year, ending in March, the council actually made a surplus of £212,000.

Although the cost of providing temporary accommodation for the homeless had been much greater than expected, this had been offset by other items that had performed better than expected such as parking, which had brought in £455,000 more income than planned for.

Similarly on its capital budget, the council underspent by £16.3m – in part because it had spent far less purchasing accommodation to meet its target of providing 1,000 new affordable homes across the borough than it had planned to do.

This was blamed on “a lack of acquisition opportunities.”

It meant the borough had ended up with unallocated balances of £11m, far in excess of the minimum £4m it aims to keep.

This year the council also put tax up by the maximum 3%, meaning the average Band D house pays £284.49 towards services provided by the borough council.